China Evergrande owes $28m for Changchun land, city govt says

Evergrande has been strapped for cash with over $300bn in liabilities

China Evergrande has more than $300 billion in liabilities. Photograph: Jerome Favre/EPA

China Evergrande has more than $300 billion in liabilities. Photograph: Jerome Favre/EPA

 

Heavily indebted property developer China Evergrande Group owes the equivalent of $28 million for land in the northeastern city of Changchun it bought in June, municipal authorities said.

Evergrande bought the land through local developer Changchun Jitao Real Estate Development Co for 601 million yuan in an auction on June 17th, part of a series of coordinated sales by 22 of China’s biggest cities.

Evergrande, which did not respond to a Reuters request for comment, has been strapped for cash with over $300 billion in liabilities.

It failed to pay nearly $150 million worth of coupons on three bonds due on Monday, after missing two other bond payments in September.

The local developer paid a deposit of 120.3 million yuan but has yet to fully make the next round of payment equal to 50 per cent of the transaction price, the Changchun Natural Resources and Planning Bureau said in a statement to Reuters when asked to confirm the sale.

Changchun Jitao Real Estate was required to pay the 50 per cent within 30 days of the sale, but has only paid 20 per cent, the bureau said in a faxed statement.

It still owes about 180 million yuan, Reuters calculations show.

Changchun Jitao Real Estate has been urged to make the 50 per cent payment in full, the bureau said in a statement dated October 11th.

Payment for the rest of the deal is not due yet, it said.

The plot of land, measuring 116,519 sq m (28.8 acres), is the only piece of land that Evergrande has bought this year in auctions conducted by 22 cities, which include Beijing and Shanghai, according to a Reuters analysis of public notices.– Reuters