Asia

Angry Evergrande homebuyers protest against construction halt

BEIJING (BLOOMBERG) – Disgruntled China Evergrande Group customers staged a protest in Guangzhou demanding that the cash-strapped developer restart stalled construction work and urging the local government to intervene.

More than 100 homebuyers in white T-shirts emblazoned with the phrase “Resume construction, Evergrande” lined up before the housing bureau of the city’s Nansha district on Thursday (Sept 9), according to people who attended the protest and asked not to be named because of fear of retribution.

They said building of units they purchased in Evergrande Peninsula, a project of almost 5,000 apartments, has been halted since May.

The tension signals that the struggles of the world’s most indebted developer may be igniting social unrest – an outcome that China’s government will be keen to avoid.

Last month, Evergrande said it had suspended work on projects due to overdue payables and is negotiating with suppliers and contractors to resume construction. Representatives for Evergrande didn’t immediately reply to a request for comment. Calls to the Nansha district housing bureau went unanswered.

Evergrande owed a record 951.1 billion yuan (S$198 billion) in trade and other payables to suppliers as of June, an earnings report showed last month. It had received down payments on yet-to-be-completed properties from more than 1.5 million home buyers as of December.

In July, Shaoyang city in central China halted sales at two of Evergrande’s residential projects, saying the developer didn’t deposit enough presale funds into escrow accounts and intentionally evaded supervision. The city removed the ban the next day. After a rare public rebuke from regulators, Evergrande’s billionaire founder Hui Ka Yan doubled down on his commitment to complete projects, issuing what he called a “military order” to ensure property construction and delivery.

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