Chinese property developers are having problems in the capital markets and cannot refinance their debts, meaning that they cannot repay debts as they fall due. Cash from sales is also drying up as the market slows dramatically:
China’s biggest property developers are still struggling to sell homes, as a resurgent COVID-19 pandemic combines with a slowing economy to deter big-ticket investments, offering little respite to the most leveraged among them.
The collective sales value of China’s top 100 developers fell 41 percent in January from a year earlier to RMB 526.6 billion ($82.7 billion), widening the slump from the 38 percent contraction in December, according to the China Real Estate Information Corporation
Zhenro had met all of the three red lines and looked economically strong in December 2021
Chinese property developer Zhenro Properties’ dollar bonds have collapsed to about 20 cents on the dollar in February 2022 after trading between 45-50 cents on the dollar earlier.