China Evergrande Group announced on Sunday that it has made initial progress in resuming construction, with its chairman promising to deliver 39,000 units of houses in December, up from less than 10,000 units in each of the previous three months.
During a meeting on Sunday, company chairman Hui Ka Yan emphasized that no one at Evergrande would be permitted to “lay flat,” asking employees to fight day and night so that sales can restart and debt can be cleared, according to a statement from Evergrande.
“With the company resuming construction work at full steam, the group plans to deliver 115 projects in December,” Hui said in the statement. “With five days left this month, we must go all out to ensure we meet the goal of delivering 39,000 units this month.”
His promise comes a day after China’s top real estate regulator told the official Xinhua News Agency that the government will forcefully address risks posed by some prominent developers’ delays in delivering residential units. Also on Saturday, China’s central bank stated that home buyers’ legal rights will be protected.
According to a business statement posted Sunday night, about 92 percent of Evergrande’s property projects have resumed thus far, compared to just about 50 percent at the beginning of September. The number of workers participating in the projects that have restarted construction has increased by 31% to 89,000 since September.
Evergrande stated in a WeChat post on Monday that it has started delivering batches of flats from projects in 18 provinces, including Guangdong, Guangxi, Gansu, Shandong, and Jiangsu, since the beginning of this month. The report includes over two dozen photos of what the company claims are homeowners receiving units at various buildings this month.
Know about Evergrande
Evergrande is a massive — and severely indebted — Chinese private-sector property developer and home builder that is on the verge of collapsing on some of its massive debts.
Last year, Evergrande generated approximately $78 billion in income, with hundreds of projects in over 200 Chinese cities. It has aggressively amassed land and developed projects for years using borrowed money and pre-sold flats.
Along the way, the corporation handed out billions of dollars in dividends to stockholders, including more than $5 billion to founder, top shareholder, and Chairman Hui Ka Yan in the last three years.
How did Evergrande fall into a big crisis?
Last year, when pandemic lockdowns hampered property sales for months, problems began to appear, leading to fears of a liquidity crunch in the fall. Meanwhile, China’s measures to curb real-estate developer borrowing via the “three red lines” prevented the company from taking on new debt.