One of the largest companies in China’s real estate market, a company that builds houses and buildings called Evergrande Group, asked for special financial protection in the U.S. It happened on Thursday. This is making people worry that the problems with properties in China might be getting worse.
Evergrande Asks for US Chapter 15 Bankruptcy Protection
Evergrande Group, owing more than $300 billion, holds the record for being the property developer with the most debt in the world. They’re dealing with a $31.7 billion debt restructuring for bonds, collateral, and repurchase agreements, which they announced in March.

The company explained that filing in a court in Manhattan is a step they need to take. This step helps protect the company from people who might want to sue them or take control of their assets in the United States. This protection is in place while they’re working on fixing things in Hong Kong, the Cayman Islands, and the British Virgin Islands.
China’s Big Real Estate Company Evergrande
Evergrande’s huge debts highlight a significant debt problem in China’s property business, which used to be a key driver of growth. This property sector makes up about 30% of China’s economy.
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In the past, property developers often borrowed a lot of money to meet the high demand for apartments. However, things changed in 2020 when the government set rules about how much they could borrow. This affected the bonds issued by these developers, which dropped in value.
The situation with Evergrande could affect banks and has a big impact on China’s enormous $60 trillion financial system. Since mid-2021, developers responsible for 40% of home sales in China have been unable to pay their debts, including Evergrande.
Another major company, Country Garden, which is the biggest privately owned developer in China, also had trouble paying off debt, increasing concerns about the country’s property market.
As China’s growth slows down, the issues in its property sector might cause problems in other parts of its economy. This is happening while China is still dealing with the effects of the pandemic.
Trading of Evergrande shares has been stopped since March 2022.