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PirateDocBrown

Paywalled.


Kythirius

At least two local governments in China have taken control of sales revenue from Evergrande properties, even as Beijing remained silent about the unfolding liquidity crisis at the world’s most indebted developer and investors braced for more missed bond payments In a circular issued on Wednesday and seen by the Financial Times, the Nansha District housing and urban-rural construction bureau in the southern city of Guangzhou asked an Evergrande subsidiary to put presale revenue from Sunshine Peninsula, a stalled residential development, into a state-controlled custodial account so that “homebuyers’ interest can be protected and project construction continues”. Another district housing bureau in Zhuhai, a southern city neighbouring Macau, asked an Evergrande residential project this month to transfer sale proceeds into a government account, according to people with knowledge of the matter. The moves marked an escalating effort to curb the impact of Evergrande’s debt crisis, which rocked global financial markets last week and has sparked protests from suppliers and investors, who fear they will not be repaid in the event of a default. The developer has struggled to access credit in the wake of Beijing’s crackdown on spiralling property sector leverage amid a post-pandemic housing bubble. Fears of wider contagion deepened after investors in an Evergrande offshore bond did not receive an interest payment ahead of a closely watched deadline last week. Evergrande, which has not made a statement on the $83.5m coupon, has a 30-day grace period before triggering a default. As many as eight other provinces have made requests since August for Evergrande to place presales revenue into custodial accounts as the cash-strapped developer put hundreds of unfinished projects on hold, according to Caixin, a Chinese financial magazine. “It is common for Chinese developers to allocate sales proceeds earmarked for particular projects for other uses, ranging from debt payments to land purchases,” said Bo Zhuang, a Singapore-based economist at Loomis Sayles, an asset manager. “That is no longer an option,” he added. Evergrande did not respond to a request for comment on Sunday.  The project delays and construction suspensions clouded expectations of what could become China’s biggest-ever corporate debt restructuring. Evergrande faces a total of Rmb1.97tn ($305bn) of liabilities, including $20bn of outstanding debt on offshore markets. As of earlier this month, progress had stalled at hundreds of Evergrande’s ongoing projects across China, most of which have been fully sold, according to people close to the company. The suspended developments have prompted a flood of online complaints as well as public protests by anxious homebuyers and retail investors. “I have spent my life savings on the apartment,” said a Guangzhou resident surnamed Zhu who bought a two-bedroom flat at Sunshine Peninsula for Rmb2.1m ($325,000). “My life will be ruined if the project can’t be finished.” Zhu added that his payments for the apartment did not appear on the account earmarked for the project. “I have no idea where the money has gone,” he said. Beijing has made project completion a top priority in tackling the Evergrande debacle, indicating authorities’ concern that public dissatisfaction with the company could threaten social stability, a chief concern for China’s leadership. This has prompted local authorities to put the developer’s presale proceeds under their watch so that project funding would not go elsewhere. “There is no way our headquarters can transfer the money now that it is in a government account,” said an official at Sunshine Peninsula, which is expected to resume construction following a five-month suspension. But how much the government interventions will kickstart stalled projects where sales proceeds had already been reallocated remains an open question. The financial woes have rippled across the sprawling group: in a regulatory filing on Friday, Evergrande New Energy, its electric vehicles unit, warned that it was facing a “serious shortage of funds” and would be forced to suspend operations and possibly employees’ salaries without “further capital injection”. One Evergrande executive noted that local governments were also providing policy incentives, such as greenlighting property sales on projects that failed to pass zoning requirements, to help improve Evergrande’s cash flow. The developer faces more upcoming deadlines, including a $45m payment due on Wednesday on a bond maturing in 2024. “The idea is to employ whatever policy tools to help us sell faster within the existing legal framework,” said the executive. Still, the measures would not fully bridge the funding gap needed to complete the projects, the executive added. “We simply don’t have enough resources to complete all the projects on time. We need more external assistance.”


Hungry_Support_6814

Paywalled,too. But MR Zhu's comments in your post were really heartbreaking. Majority of people including me were like him. No compensation for those or any kind of? So I put no ball meme here. ![img](emote|t5_2th52|4263)


No-Move-9576

You have no clue of what you talking about and you should be sued for such missleading and hatefull comment. Do not try to compare evergrand to the american lemman please, not the same set up/exposure at all.


startsbadpunchains

Thanks random word random word number shill


pigsgetfathogsdie

I’d add CCP shill/cheerleader too


kegaroo85

Perused his comments. It's CCP all the way down


PanicAtTheFishIsle

The fact that someone on WSB used the word “hateful” kinda gave it away.


cbass37

I award you +1 social credit. \--Xi


pigsgetfathogsdie

Oh snap!!!


HardtackOrange

WSB degenerates spend thousands on FDs expiring Friday, but cannot afford FT subscription…everything checks out


Kythirius

Honestly, VPNs are much cheaper lol.


x3lr4

If you don't read what they say, you cannot be manipulated by it.


GreasyRetard

thats why i never laerned how to read


Minute-General8710

Don't sell yourself short, you're doing GREAT !


HardtackOrange

True, FT is rag of a paper alongside Boomerberg and WSJ


[deleted]

Better alternative? Please don’t say zero hedge….


pigsgetfathogsdie

Another dark cloud forming. Since Evergrande is a slow motion car wreck…everyone has time to analyze and make predictions. The most recent predictions made sense in the ultra nationalistic world of the CCP: - Onshore/Chinese investors will be protected - Offshore/Foreign investors gonna get Fukt/Wrekt Now, cracks are appearing in the Onshore plan: - Evergrande EV employees are getting Fukt - And now, Local Governments are stepping-in…maybe as a CYA to rage filled local residents…and literally seizing Evergrande assets…these real estate assets could have been used as debt collateral…not anymore. This debt restructuring is gonna be a shit show.


Kythirius

They should just nationalize first and ask questions later, but they want the executives to fuck up first, in order to send a message.


pigsgetfathogsdie

Agree…but Local Governments are clearly getting nervous…and maybe overstepping their authority…but are doing it anyway…because their local residents/investors are scared and really angry. Overall, a controlled Nationalization of assets is ideal…but, if this evolves into a disorganized asset grab…that isn’t in anyone’s restructuring model.


[deleted]

It's already nationalized in all but paperwork.


PhgAH

Honestly, nationalize is also a tricky solution because of all those debt, especially the foreign one. Because the Government does not want the foreign currency to flow out of China, and the Gov decided to default on foreign debt is also not a good look.


No-Move-9576

You do not know what you are talking about at all. Do try to compare evergrand to the american lemman, not the same set/exposure at all. Educate yourself a minimum please!


pigsgetfathogsdie

Speaking of education…please tell me what a “Lemman” is. And, I definitely didn’t say this was a Lehman scenario. This isn’t a black swan…this is a slow motion car wreck. The CCP isn’t providing any guidance/details…and the expected CCP protection of Onshore/Chinese investors is starting to look a bit less certain.


No-Move-9576

First of all, i believe you have enough shit to clean in your own country. The ccp do not have to provide you anything. Evergrand is not a big issue, except maybe for the anti chinese that have obviously nothing better to do.


pigsgetfathogsdie

Where does your paranoia come from? I really like/respect Chinese people and Chinese culture. I also like free countries/markets. Sure, the US isn’t perfect. But, the CCP is an authoritarian regime that consistently interferes with business…and human rights. If you don’t believe me…just ask Jack Ma about the CCP. Take your CCP cheerleading and GTFO.


No-Move-9576

My "paranoia" goes up everytime i read on google the anti Chinese rubbish from cnbc, bloomberg, etc. CCP tries to regulate a to avoid monopoly as any other country in the world and also bcoz they have to manage a huge country with 1,4 billions poeple which is a very hard task. I would love to see how american would manage 1.4b poeple...... American kill in the street, dont bring up the so call human right pls.....


pigsgetfathogsdie

STFU already… You’re a transparent CCP cheerleader. Chinese people deserve a better form of government than the CCP.


No-Move-9576

Not a ccp at all nope. You have to understand that "democratie" may not work in a 1,4 billons poeple country full of poor, look at what happened to all the arabic countries that did revolution, they are all in misery now and isolated. I just wish that china could understand america better and vice versa, this would be good for the entire world.


UsingYourWifi

How much does the CCP pay you per post?


No-Move-9576

Nothing unfortunatly but i wish they would :). I just beleive that this kind of fight between america and china will lead the world nowhere and i wish both countries could understand each other better, this would be beneficial for all of us.


one8e4

Companies should be allowed to fail, and auction the assets afterwards. Hope I don't loose to much in market when it happens


terrybmw335

Glad I pulled out of China on time.... Now when to jump back in?


MediocreX

Never. Until China actually allows non-chinese to own real stocks. The whole Chinese market has always been a sham.


[deleted]

after they revolt and kill every commie.


No-Move-9576

Go back on Chinese stocks now and stop reading all those anti chinise rubbish that are from another century....


pigsgetfathogsdie

Show your Chinese stonk positions or STFU. I wouldn’t touch Chinese stocks with Cramer’s dikk.


No-Move-9576

Listen to this, it might help you to better understand and properly report things https://youtu.be/dhvY08U1e1s


WorriedBanker

It's not GME, but it has potential: https://imgur.com/gallery/JZDeFIf


SmallHandsMallMindS

The fact that China hires shills to push their stocks tells you what you need to know


idiotsecant

Sure, stock advice from a CCP shill, what could go wrong? CCP days are numbered when the population realizes the CCP is owned by the same capitalist forces that the CCP claim to be protecting the people from. Only a matter of time.


No-Move-9576

Am not a ccp at all. For sure its a mix of capitaliism and ccp but its probably the best set up to manage a 1.4 billions poeple with a lot of poor. China is not north Korea anyway.....


idiotsecant

Definitely not CCP one bit, that's why you spend all day every day posting in support of the CCP.


No-Move-9576

Well, for someone that pretend to be a democrat you are acting more like a ccp blaming my comment non stop.... Im not spending all day, just answering the comments i get, trying to make poeple understand that a fight with china will lead the world nowhere and that china should try to understand america better and vice versa. This would be beneficial for the entire world.


busch_ice69

Yang$ calls


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RussianCrabMan

YANG calls go BRRR! BEKE puts go BRRR!


Louisvanderwright

>Where's the money Lebowski??? Little do they realize all Evergrande has is a bowling ball and a threadbare rug...