John Han Discusses Evergrande with the Wall Street Journal
October 4, 2023
Publication: The Wall Street Journal
Embattled Chinese real estate developer Evergrande is in dire straits after parts of its proposed turnaround plan were blocked by China's regulators. Market observers are left wondering what this could mean for other similarly troubled real estate companies in China, such as Country Garden, that are currently navigating a turbulent housing crisis in the world's second-largest economy. Kobre & Kim's John Han, who focuses on cross-border monetization of distressed assets, sat down with The Wall Street Journal to discuss what might be next for the property giant and other Chinese real estate companies.
With concerns growing among creditors about the possibility of regulatory intervention, Han points to a possible wave of attempted liquidations spurred by foreign creditors. "There are signs of a break in patience," Han said. "It only takes a few breakaway creditors to wind up a company, and the more surprises we see like this, the more likely it is that creditors will opt out in favor of a liquidation."
A few weeks prior, Han spoke extensively with The Wall Street Journal on Country Garden, whose financial distress is also causing mounting concerns among offshore creditors. Han pointed to Forest City, an empty megaproject in Malaysia, which could offer creditors up to US $1.5 billion in recovery.
On August 29, Han, along with fellow Kobre & Kim lawyers Jason Kang and Timothy de Swardt (based respectively in Shanghai and the BVI) hosted an open call that analyzed further cross-border monetization opportunities and challenges facing Country Garden’s offshore creditors.