Evergrande shows China property 'zombification': 5 things to know

Struggling companies halting unfinished projects as market totters

High rise construction sites rise in clouds of rolling mist in Bijie, Guizhou province on June 13. (Photo by CFOTO/Future Publishing via Getty Images)

NORIYUKI DOI, Nikkei staff writer

August 18, 2023 20:00 JST

SHANGHAI -- China Evergrande Group, a major Chinese property developer undergoing management rehabilitation, has filed for protection from creditors under Chapter 15 of the U.S. bankruptcy code.

"Zombification" is increasing among property developers in China. Financially struggling companies are discontinuing construction projects before completion, highlighting that the Chinese property developers' growth model based on rising real estate prices is reaching its limit.