In an announcement made by Country Garden, China’s largest private property developer, the company foresees a continued weakness in the country’s property market throughout 2024. The management expressed concerns about facing more “severe” challenges in the coming year, following the default on $11 billion worth of offshore bonds in October and the extension of repayments on onshore notes in the previous year.
Country Garden is part of a growing list of developers grappling with a cash crunch since the onset of a debt crisis in mid-2021. During an annual internal conference on Monday, Chairperson Yang Huiyan noted that the market did not recover as expected in the previous year and was still undergoing correction.
Country Garden President Mo Bin acknowledged the potential for more formidable challenges in the upcoming year and emphasized the need for a calm and strategic response. Yang Huiyan predicted that the property market would “hover at a low level” in 2024, with varying outlooks for different cities and disparities between state-owned and private companies becoming more apparent.
The company’s top priority for the year is home delivery, aiming to deliver 480,000 homes to buyers. This represents a 20% decrease from the 600,000 units delivered in 2023, a year in which the company achieved the highest number of home deliveries in the country.
Last March, Yang had announced the decision to shut down all side businesses, except for contract construction and the construction robot business, as part of an effort to enhance margins and reduce costs. Country Garden reported that it has commercialized 28 types of robots and delivered 2,890 units to clients. The contract construction unit has successfully completed 30 developments worth 24.4 billion yuan, earning it the 11th position in terms of constructed area in 2023 in the country.
As Country Garden navigates through the challenges, the real estate giant remains focused on its core business areas, emphasizing home delivery, strategic construction projects, and advancements in construction technology.
