China Evergrande Group’s removal from the Hong Kong stock exchange has become a symbolic turning point in the nation’s deepening property sector slump, now in its fourth year and still dragging down economic growth.
Once China’s largest developer by sales, Evergrande will be officially delisted on August 25, nearly 18 months after trading was suspended and almost 16 years after its debut. The move comes as liquidators revealed the company’s debt load has swelled to HK$350 billion ($45 billion) — far higher than previously disclosed — and declared a comprehensive restructuring “out of reach.”
“This is a symbolic moment for the mainland property sector,” said Kenny Ng, strategist at China Everbright Securities International. The collapse, he added, “will definitely leave a deep memory in all investors in the market.”
Evergrande’s collapse is the largest in a real estate crisis that has battered China’s economy and created a record wave of distressed developers. The company first defaulted on a dollar bond in December 2021 and was once valued at over $50 billion at its 2017 peak.
Despite Beijing’s stimulus measures, property sales remain sluggish. Analysts at UBS have pushed their recovery forecasts to mid-to-late 2026 after new-home sales by China’s 100 biggest developers fell more than 20% for two straight months, according to China Real Estate Information Corp.
The Politburo has so far avoided adding fresh property stimulus despite mounting calls for support. Meanwhile, other developers are also crumbling. On Monday, China South City Holdings Ltd. was ordered into liquidation by Hong Kong’s High Court, joining at least six others that have been wound up since 2021.
Evergrande’s liquidation is proving particularly complex, involving 3,000 legal entities across multiple jurisdictions, 1,300 projects in more than 280 cities, and control over 100 companies worth HK$27 billion. The firm’s property management arm, Evergrande Property Services Group Ltd., with around 3,000 projects, is being given “the highest priority” by liquidators as a potential major source of value.
So far, asset recovery has been modest at $255 million, with $167 million linked to Evergrande — though complex ownership structures may limit how much is actually available. Deloitte previously estimated offshore unsecured creditors could see a recovery rate of just 3.53%.
“The announcement of Evergrande’s delisting could add more pressure to mainland builder shares still trading,” said Ng. “It’s a lesson to investors, alerting them to spend more time to understand a company’s business when earnings are growing too fast and to study policy shifts.”