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Eversheds comment: Chinese developers' record borrowing still seen by lenders as good value

  • United Kingdom

    05-09-2014

    Commenting on news that Chinese property developers are borrowing at a record pace, Bruce Dear, partner and real estate expert at law firm Eversheds, says:

    “China’s larger developers represent a measured risk for lenders. Extraordinary central bank rates have created a global yield famine. Lenders and bond buyers must take return where they can. Because players with access to bond and syndicated markets must meet size and strength thresholds, lenders still believe they are funding the strong and avoiding the weak. Their borrowers should be big enough to attract state backing if distress sets in. If needed, China’s economic policy also has the ability to be much more directive and decisive than Western central bank guidance. In this context, China’s largest developers still look interesting value.”

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