China: Chinese property giant Evergrande Group — once the country’s second-largest property developer — has filed for bankruptcy in New York, CNN reported. The development comes amid a deepening real estate crisis in China, with some of the top companies struggling to find money to complete constructions.
The move by Evergrande, one of the world’s most heavily indebted property developer, will allow it to protect its assets in the US as it negotiates a multi-billion dollar deal with creditors, BBC reported.
Evergrande has filed for Chapter 15 bankruptcy protection, which shields the US assets of a foreign company as it works on restructuring its debts.
In 2021, Evergrande defaulted on its huge debts, triggering a massive property crisis in China’s economy. Its debts are estimated to be more than $300 billion, making it the world’s most heavily indebted real estate developer. The company’s shares have been suspended from trading since March 2022.
According to its website, Evergrande has more than 1,300 real estate projects in more than 280 cities.
In July, Evergrande revealed that it lost $80 billion over the last two years, BBC reported.
The firm’s default came after the Chinese government began a crack down on excessive borrowing by real estate players in a bid to arrest soaring housing prices.