Thursday, November 1, 2018

China Real Estate Shakeout

https://www.bloomberg.com/news/articles/2018-10-31/china-s-100-000-developers-are-bracing-for-a-giant-shakeout?srnd=premium-asia

For developers, it all amounted to a near-limitless business opportunity, and many went deep into debt to finance giant projects that often sold out in hours, with would-be buyers in some cases storming sales offices

And in the next few years, developers face a mammoth wall of bond maturities.

“Very likely the act of deleveraging will kill a bunch of players,” said Sean Zhang, Cushman & Wakefield Inc.’s China head of financial advisory services. “Lots of companies have found the funding doors completely shut. I’ve started to tell some clients: don’t bother financing, you’d better sell.”

The developer lurched into full-blown crisis this year, defaulting on bond payments and having its stock halted after a 62 percent plunge since Jan. 1

“Sentiment is taking a turn. The market just started to feel winter.”
— With assistance by Emma Dong

Will India be different because we have Modiji? I don't think so!

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