China’s builders tackle restructuring as crisis enters new phase

CHINA’S property-debt crisis has entered a new stage, as tensions have increasingly shifted to developers’ court battles with creditors over debt restructuring plans, and the once-unthinkable consequence of liquidation orders.

At least 23 Chinese builders or related companies have so far received wind-up petitions in Hong Kong from creditors since the beginning of the real estate crisis, according to Bloomberg-compiled data. So far, at least five of them have been ordered to wind up.

That includes China Evergrande Group, whose liquidation order sent shock waves through the sector, underscoring the legal risk of failing to assuage the concerns of key groups of creditors. Adding to the company’s troubles, the nation’s top securities regulator fined its main onshore unit for falsely inflating revenue by more than US$78 billion in the two years leading up to its failure.

Smaller peers, including Redsun Properties Group and Kaisa Group Holdings, will face hearings in the city in the coming weeks. The list of court battles is likely to expand: Chinese developers have defaulted on US$111 billion of onshore and offshore bonds since the nation’s real estate crisis began in 2021, according to Bloomberg-compiled data.

The following list includes key dates and the progress of offshore debt-restructuring efforts for China’s biggest defaulted developers by total liabilities. Debt figures are based on Bloomberg-compiled data and public filings. The estimated size of debt restructuring is based on debt-claim disclosures, existing offshore debt or offshore interest-bearing liabilities in public filings.

China Evergrande Group

• Total Liabilities: US$332 billion
• Estimated offshore debt restructuring size: At least US$38 billion
• Next to watch: Liquidation process, delisting risk

Country Garden Holdings

• Total Liabilities: US$189 billion
• Estimated offshore debt restructuring size: Unclear
• Next to watch: Court hearing on May 17

Sunac China Holdings

• Total Liabilities: US$139.4 billion
• Estimated offshore debt restructuring size: About US$10 billion
• Next to watch: Restructuring payments

Shimao Group Holdings

• Total Liabilities: US$71.1 billion
• Estimated offshore debt restructuring size: About US$12 billion
• Next to watch: Restructuring plan details

Yango Group

• Total Liabilities: US$38.2 billion
• Estimated offshore debt restructuring size: Unclear
• Next to watch: Onshore restructuring process, offshore unit liquidation

China Aoyuan Group

• Total Liabilities: US$33.7 billion
• Estimated offshore debt restructuring size: More than US$6 billion
• Next to watch: Operations of the company

Kaisa Group Holdings

• Total Liabilities: US$32.7 billion
• Estimated offshore debt-restructuring size: More than US$12 billion
• Next to watch: Court hearing on Apr 29

Logan Group

• Total Liabilities: US$31.7 billion
• Estimated offshore debt restructuring size: About US$8 billion
• Next to watch: Signing agreement with creditors in April

CIFI Holdings Group

• Total Liabilities: US$26.5 billion
• Estimated debt restructuring size: About US$7 billion
• Next to watch: Details of a restructuring plan

Sino-Ocean Group Holding

• Total Liabilities: US$26.5 billion
• Estimated offshore debt restructuring size: Unclear
• Next to watch: Details of a restructuring plan