On the 2025 Fortune China 500 ranking for real estate companies, China’s leading real estate developer Poly Real Estate ranked first with a total revenue of ************ U.S. dollars, followed by China Vanke and Country Garden. Real estate market in ChinaIn the last 20 years, China’s real estate market has experienced its most prosperous development. Land purchase has also become an important source of financial revenue for many local governments. The housing price increased so rapidly, especially in larger cities, that the government had to take measures to restrict investment. With the slowdown of China’s economic development and gradually saturated market, people are also afraid of the burst of the real estate bubble. While the real estate price in smaller cities tended to stay stable or even decrease, there is still growing potential for real estate prices in larger cities, especially the first-tier cities. China’s consumers are increasingly interested in the high-quality real estate products built by leading real estate developers. Leading real estate developers in ChinaCompared to the ranking in 2021, there were ***** new members entering the leading ten real estate developer club in 2022. The larger developers became stronger as they had advantages in land acquisitions, financing, marketing and pricing power which is difficult for smaller developers to catch up with. Thus, consolidation is also very common among China’s real estate developers. In 2022, *** real estate giants disappeared from the Fortune 500 ranking list, Evergrande and Sunac. Affected by the changing real estate market, they were facing cash flow problems and were affected heavily by the debt crisis.

As of December 2022, the value of total assets of the Chinese real estate developer Evergrande dropped to around **** trillion yuan. Between 2015 and 2020, the enterprise’s assets grew significantly, almost tripling within a five year period.

Missed bond payments

In late September 2021, Evergrande missed a payment of a U.S. dollar-denominated offshore bond which put the spotlight on the company’s dire financial situation. Evergrande Group has amassed more than *** trillion yuan of debt which was around two percent of China’s GDP. Real estate has been an important sector of the county’s economy and a systemic crisis would seriously impact economic development.

Ripple effect

The news of the financial predicament that one of China’s largest property developers has found itself in sent ripples through the real estate industry. For many years, the property sector was booming and the demand for housing was high. This allowed property developers to get away with speculative investments. Since the sector constitutes a significant share of the economy, the Chinese government implemented regulations to put a limit on enterprises’ reliance on debt financing.