Evergrande tries to pay bills with parking spots

Shenzhen

PROTESTERS gathered for a third straight day at the offices of teetering developer Evergrande, after a company offer of property and parking spaces instead of cash repayments angered already upset investors.

The troubled property titan has warned it may not be able to service its colossal debts of more than US$300 billion, seeding panic across property buyers, bond holders and contractors, and fanning fears of a default that could ripple through the world's second-biggest economy.

Experts say the Hong Kong-listed developer has more than a million units pre-paid but yet to be built, adding to the sense of dread among Chinese investors, many of them first-time buyers trying to get a foot on the runaway Chinese property market. The company on Tuesday admitted that it is under "tremendous pressure" and may not be able to meet its liabilities.

Around 60 protesters returned to the Shenzhen headquarters on Wednesday, with more expected later in the day to demand their money back from a privately owned firm, whose rapid expansion into 280 Chinese cities once armour-plated its reputation.

They briefly surrounded a man who appeared to be a company representative and chanted "Evergrande, give us our money back". They were met by a heavy police presence but refused to disperse, more so after an apparent effort overnight by Evergrande to repay debts with promises of property, parking spaces and store units soured the mood.

"They offered us shops, kindergartens and parking units... but we can't use them. None of us agree to this," said a woman who gave her surname only as Wang and whose financial company in Chongqing is "not really functioning" because of unpaid debts from the developer.

But while there are dire warnings about what impact a default by Evergrande would have on the economy, experts say a disorderly implosion was not expected to happen as Beijing would likely step in. AFP

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