After China’s property giant Evergrande Group faced a debt repayment deadline, another real estate developer Modern Land is struggling to pay its debts now. Citing Hong Kong Stock Exchange, Jill Disis, writing in CNN said that Modern Land on Monday asked its investors for more time to pay back a USD 250 million bonds.
China’s property crisis is ensnaring yet another developer. The payment was due October 25. Modern Land said it wants to extend that deadline to the end of January as it seeks to improve “liquidity and cash flow management and to avoid any potential payment default,” wrote Disis. The company said in a separate filing that Chairman Zhang Lei and President Zhang Peng intend to provide about 800 million yuan (USD 124 million) in loans to support the company.
Shares in Modern Land fell more than 2 per cent in Hong Kong on Monday. The stock is down 45 per cent this year. News of the company’s financial difficulties came on the same day China’s second-biggest developer Evergrande faced another debt repayment deadline, this time for about USD 148 million in interest payments on US dollar-denominated bonds, according to Refinitiv data, said Disis.
Evergrande did not immediately respond to a request from CNN Business for comment. The embattled real estate conglomerate has been hunting for buyers for some of its businesses as a major cash crunch threatens to sink the company.
China’s most indebted developer has already missed interest payments on bonds. That has fuelled speculation over whether the company could see a Beijing-backed bailout, restructuring or default, added Disis. Modern Land, based in Beijing, calls itself the country’s “leading operator of green technology industrial homes,” and says it has completed nearly 200 projects in more than 50 cities in China and abroad.