Protesters gathered for the third day in a row at the offices of developer Evergrande, after an offer of property and parking spaces from the company instead of cash returns infuriated investors.
The troubled real estate titanium has warned that it may not be able to meet its colossal debts of more than $ 300 billion, sowing panic among property buyers, bondholders and contractors and avoiding fears of a default that could affect the second economy world.
Experts say the Hong Kong-listed developer has more than a million prepaid units, but that it has not yet been built, adding to the feeling of fear among Chinese investors, many of them first-time buyers trying to take a step into the runaway Chinese property market.
The company admitted on Tuesday that it is under “enormous pressure” and may not be able to meet its liabilities.
About 60 protesters returned to their headquarters in Shenzhen on Wednesday, and were expected to claim their money from a private company later that day, whose rapid expansion into 280 Chinese cities shielded their reputation.
They briefly surrounded a man who appeared to be a representative of the company and chanted “Evergrande, give us back the money.”
They found a strong police presence, but refused to disperse, after an apparent effort by Evergrande overnight to pay off debts with pledges of property, parking spaces and warehouses that aggravated the ‘mood.
“They offered us shops, kindergartens and parking lots … but we can’t use them. None of us agree with that,” said a woman who gave her last name only as Wang and that the his financial company in Chongqing “doesn’t really work” “due to the developer’s unpaid debts.
“They are trying to deal with their bad properties,” another investor who asked for anonymity told AFP.
“(But) they are products they can’t sell.”
On Wednesday morning a woman sat on the floor in front of the offices crying, while several officers stood guard nearby and expelled the journalists.
Despair is brewing among unpaid suppliers – some in Shenzhen who say they owe them more than a million dollars – as well as investors, who depend on returns to pay off their own loans and salaries. staff.
The giant debt mountain helped drive Evergrande’s voracious expansion, which began until the property boom of the 1990s until Beijing went on to curb leveraged growth by introducing “three red lines” in 2020.
But while there are serious warnings about the impact an Evergrande defect would have on the economy, experts say a disorderly implosion was not expected, as Beijing would likely intervene.
“An Evergrande defect could hurt consumer confidence if it affected household deposits for homes that have not yet been completed, but we assume the government would act to protect the interests of households, which makes this result be unlikely, ”rating agency Fitch said in a note on Wednesday.
So far, Hong Kong markets in New York have taken Evergrande’s problems hard, despite months of bad news about the company, including two downgrades and painful statements from the company.
bys / apj / dan