China's real estate industry body to hold meeting amid Evergrande crisis

World Wednesday 13/October/2021 17:23 PM
China's real estate industry body to hold meeting amid Evergrande crisis

Beijing: As the debt crisis at Evergrande continues to spark concerns in China, the country's top real estate industry body is planning to convene a meeting on Friday to deal with issues in the housing market.

An internal meeting will be held by the China Real Estate Association on Friday in the capital city of Beijing to evaluate challenges faced by real estate companies, the Global Times reported cited a source close to the matter. According to the Chinese state media, the meeting will bring in high-level executives from housing enterprises to probe the problems in the housing market and address the turbulence.

As pressure mounts on the housing market in China, several research and banks have cut the growth outlook of the country. This bleak state of affairs came to the limelight after the revelation of Evergrande Real Estate Group's debt crisis.

Evergrande, China's second-biggest real estate developer, is marred with debt it cannot pay back.

The embattled developer owes a total of USD 368 billion in loans to banks, along with liabilities to contractors and suppliers. Experts believe that declining sales, a high-risk business model, and China's clampdown to curb the boom in the Chinese housing market brought the company into crisis.

After China's property giant Evergrande Group faced a debt repayment deadline, another real estate developer Modern Land is struggling to pay its debts now.

Citing Hong Kong Stock Exchange, Jill Disis, writing in CNN said that Modern Land on Monday asked its investors for more time to pay back a USD 250 million bonds.

China's property crisis is ensnaring yet another developer. The payment was due October 25. Modern Land said it wants to extend that deadline to the end of January as it seeks to improve "liquidity and cash flow management and to avoid any potential payment default," wrote Disis.

The company said in a separate filing that Chairman Zhang Lei and President Zhang Peng intend to provide about USD 124 million in loans to support the company.