The crisis of the Evergrande is spreading more

The crisis of the shaky Chinese real estate group China Evergrande is spreading more and more circles in the Middle Kingdom. The also sluggish Chinese real estate developer Fantasia restricted trading in Shanghai with its bonds after a credit rating downgrade. In addition, the smaller real estate developer Modern Land announced that it would ask investors to postpone a repayment date for outstanding bond debts. The steps taken by the two companies make it clear what wave the Evergrande crisis is now striking in the Chinese real estate industry. Evergrande has more than $ 300 billion in debt, of which nearly $ 150 million will soon be due in foreign debt. Funders are already preparing for imminent payment defaults. For many non-state Chinese real estate developers, it is now a question of surviving the next three months, says real estate analyst Cai Hongfei from brokerage firm Central Wealth Securities. "Asking them about their repayment schedule in six to twelve months is a question they simply cannot answer." The bonds from Fantasia are only supposed to change hands after negotiations. The rating agency China Chengxin International Credit Rating (CCXI) had previously downgraded the stocks. So far, these have been traded on the Shanghai Stock Exchange. Two Fantasia bonds were suspended from trading on Friday after parent company Fantasia Holdings missed the deadline for a bond repayment of $ 206 million on October 4. Most of Fantasia’s bonds have already lost around 80 percent of their value. The smaller real estate company Modern Land said it would ask its investors to postpone the due date for a US dollar bond that expires on October 25 by three months. In this way, insolvency should be avoided.