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After Evergrande, Sunac becomes the second major Chinese developer to file for bankruptcy protection in the United States
The crisis in the Chinese real estate sector continues to deepen, with Sunac, one of the country's leading developers, filing for bankruptcy protection in the United States. This move comes after the company obtained approval to restructure almost US$10 billion in debt. Sunac is the second major Chinese developer to seek such protection in weeks, following in the footsteps of Evergrande, which has posted massive losses in recent years.
The protection order could be a strategy to help Sunac negotiate with foreign creditors as it works to review its debt. The company recently reported that it had obtained approval from more than 2.000 creditors to restructure its debt, a significant step in its efforts to manage its financial situation.
Sunac, once China's third-largest developer in terms of sales, is facing a worsening financial crisis. Sales have been declining, and the company has accumulated a significant amount of debt. Sunac's financial situation is a reflection of the wider crisis affecting the Chinese property sector, with many developers struggling to pay their debts due to falling sales.
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In recent months, Chinese policymakers have announced a series of measures to support the struggling industry. However, the central question remains: how will these policy measures help in the recovery of sales and real business? The answer to this question will determine the future of the Chinese real estate sector and, by extension, the broader economic impact in China and globally.
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