Nov. 13th, 2021
In a story by The Epoch Times on November 12th, 2021, it talks about the growing problem with Mainland China’s property bubble crisis and how it will inevitably affect the American market and markets from all over the world. As for America, much of the impact appears likely to be felt in California and New York, where Chinese investors own many large commercial buildings, and are the main backers of several high-profile development projects. The struggling Property development company Evergrande Group has not been able to repay $300 billion in debt obligations and this appears to be just the beginning of the threat of possible defaults in the Chinese real estate market. Chinese developer Oceanwide Holdings Co Ltd announced that creditors have seized two of its major California projects, including the 2 million square foot Oceanwide Centre in San Francisco.
Evergrande and Oceanwide are simply the tip of the iceberg with many more property companies in Mainland China in trouble, namely Shenzhen based Fantasia and Shanghai based Sinic Holdings as they also missed debt payments in October on bonds worth $315 million and $246 million, respectively. In early November, S&P Global Ratings downgraded Sinic Holdings Group to a CCC+ rating, junk bond status citing “a failure to communicate a clear repayment plan.” It comes as no surprise that seven of China’s top ten developers reported severe drops in net profit in the third quarter of 2021.
China’s property investments extend far beyond its borders, with big Chinese investors funding large projects in the US and around the world. Individual Chinese homebuyers are also an important factor in many West Coast markets from Vancouver to San Diego. According to a recent report by the National Association of Realtors, California has long been the most popular U.S. market for Chinese investors, with nearly 35 percent of China’s $15 billion in overseas real estate investments focused in that state. New York real estate ranks second, attracting over 14 percent of Chinese investment, almost all of that concentrated in Manhattan.
Will the Communist regime bail out Evergrande and all the other property companies that have over borrowed and mishandled their assets? They have left it late if that is their plan, but be sure they will have a plan. The Communist Chinese Regime always has a plan.
To learn more about this story, please click here: China Real Estate Crisis Could Mean Trouble for US Markets
Editor: Mr Cow
Edited by：【Himalaya London Club UK】
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