Modern Land becomes latest Chinese developer to default as Evergrande grabs lifelines

A little over a month ago, the latest liquidity crisis at massive Chinese property developer Evergrande Group raised alarm bells worldwide. But then, the highly indebted conglomerate managed to grab several lifelines, including:

• Negotiating a “resolution” on one $35.9 million payment.
• Gliding into a 30-day grace period for one $83.5 million bill and securing a “more than three-month extension” to a $260-million bond.
• Paying off an $83 million bond coupon held by international investors.

At least for the time being, the IMF says that the risks from Evergrande are “contained.” This could, of course, quickly change if a default on a future bond payment — of which Evergrande has many due over the coming months — sets off an unpredictable market panic and contagion.

At the same time, other property developers have had worse luck. Yesterday, Modern Land, a “​​Chinese developer of real estate projects that use green technologies…didn’t repay either the principal or interest on a $250 million bond,” Bloomberg reports.

Modern Land joins a list of troubled companies in the sector, including Evergrande, Sinic, China Properties Group, and Fantasia Holdings.

• The green developer’s missed payment brings the total amount of defaults among Chinese borrowers this year to about $9 billion, a third of which is in real estate, per Bloomberg.

For context on Evergrande and its place in China’s economy, see on The China Project: The fall of the Evergrande boss; The end of China’s runaway growth.

See also:

• Modern Land becomes latest Chinese developer to miss a bond payment / FT (paywall)
• Developer’s blown payment deadline puts record Chinese defaults in focus / Caixin (paywall)
• China Evergrande expects to deliver 32 projects in Pearl River Delta by end-2021 – local media / Reuters
• China urges Evergrande founder to pay debt with personal wealth / Bloomberg (paywall)