Curtain down. China Evergrande Group, once a symbol of China's economic growth, will be officially delisted of Hong Kong the August 25, 2025The epilogue comes after more than a year and a half of suspension of negotiations and following the decision of the Listing Committee of the Asian square, which certified the failure to comply with any requirement to stay on the stock exchange.
Actions, already blocked since January 2024 at a negligible price – less than two euro cents – they will formally remain the property of investors, but without a market on which to trade them. Evergrande has announced that it will not appeal.
From Boom to Bust: Evergrande's Long Fall
Founded in 1996 in Guangzhou, Evergrande had become in a few decades the China's second largest real estate developer, with 1.300 projects in over 280 citiesThe company had ridden the country's construction boom, but financed itself with debt. In 2021, its liabilities had reached 300 billion dollars, the highest ever recorded in the sector globally.
Il the breaking point comes right in 2021, when the company defaults on a dollar-denominated bond. The move marks the beginning of a chain reaction of defaults, exacerbated by Beijing's restrictions on real estate lending in an attempt to cool the bubble. The financial squeeze deprives Evergrande of the breathing space it needs to service its debts, plummeting market and buyer confidence.
The court verdict and the liquidation
Il On 29 January 2024The Hong Kong court orders the liquidation of the group, deeming the proposed restructuring plan inadequate. The company is appointed to manage the process. Alvarez & Marsal, with a herculean task: to dismantle the largest real estate puzzle in the world.
The balance? In the first 18 months just recovered 255 million dollars on a declared heritage of 1,8 trillion yuan (approximately $250 billion in 2022). Less than 1% of the total, hampered by the fact that most of the assets are located in mainland China, outside Hong Kong's jurisdiction, and by Beijing's prioritization of completing unfinished construction sites.
Among the liquidated assets, also a painting by Claude Monet, along with luxury cars, club memberships and school qualifications. But the road is still long and the process could take more than a decade.
Accounting Fraud and Criminal Charges
Then in March 2024 the China Securities Regulatory Commission throws further fuel on the fire: Evergrande would have inflated revenue by $78 billion between 2019 and 2020, blaming non-existent sales to attract investors and raise capital.
The founder Hui Ka Yan He was fined $6,5 million and banned for life from Chinese financial markets. The former CEO was also fined $XNUMX million and banned for life from Chinese financial markets. Xia HaijunThe group's parent unit, Hengda, was fined a record $580 million.
Evergrande Crackdown: A Shockwave for China and the World
The collapse of Evergrande marked not only the end of a real estate giant but also the reversal of an entire sector. For years, real estate had driven the growth of the 30% of China's GDP, fueling growth and wealth. Today its weight has dropped to 15% or less, and house prices continue to depress confidence that is already at historic lows.
Many other developers – from the Country Garden case to other lesser-known names – are still negotiating with creditors to avoid the same fate. China's "building miracle" has lost its champion and the entire sector is trying to free itself from the longest nightmare in its recent history.
The impact of the collapse in prices on investors and households has been devastating, eroding wealth and reducing the push for consumption. But qsome signs of stabilization are beginning to emerge. Second The Economist,, in the first four months of 2025, new home sales fell by less than 3%, a significant improvement compared to the 17% collapse in the same period in 2024. A slowdown in the crisis, certainly, but with deep wounds that will continue to weigh on the Dragon's economy.
