Chinese real estate developer Zhejiang Xingrun defaulted on its debt of US$566.6 million (RMB3.5 billion) on Monday, Businessweek reported. The company’s collapse has precipitated fears that other real estate developers will also renege on their debts, amid concerns of strains in the nation’s real estate sector. Prices on the dollar bonds sold by Chinese real estate developers fell following news of Zhejiang Xingrun’s default. With liquidity tightening and an oversupply of real estate in smaller Chinese cities, banks and investors are reassessing credit risks after the Chinese government allowed Chaori Solar (002506.SHE) to collapse.
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