Asia’s richest woman has lost more than half her fortune in the past year as the crisis engulfing China’s property sector continues to deepen, a billionaire index showed on Thursday.
Yang Huiyan, majority shareholder of China’s largest property developer Country Garden, saw his net worth plunge more than 52% to $11.3 billion from $23.7 billion a year ago, according to the Bloomberg Index. Billionaires.
In a sign that the crisis is spreading to developers once thought to be strong, Yang’s fortunes took a big hit on Wednesday when Hong Kong-listed shares of Guangdong-based Country Garden fell 15% after the company announced that it would sell new shares to raise money.
Yang inherited his wealth when his father – Country Garden founder Yang Guoqiang – transferred his shares to him in 2005, according to state media.
She became Asia’s richest woman two years later after the developer went public in Hong Kong.
But she is now barely holding on to that title, with chemical fiber tycoon Fan Hongwei in second place with a net worth of $11.2 billion on Thursday.
Chinese authorities clamped down on excessive indebtedness in the real estate sector in 2020, leaving major players such as Evergrande and Sunac struggling to make payments and forcing them to renegotiate with their creditors as they teetered on the edge of the brink. bankruptcy.
Buyers across the country, enraged by construction backlogs and delayed deliveries of their properties, have begun withholding mortgage payments for homes sold before completion.
While Country Garden has remained relatively untouched by industry turmoil, it spooked investors by announcing on Wednesday that it plans to raise more than $343 million through a stock sale, in part to pay off debt. .
Proceeds from the sale would be used to “refinance existing offshore debt, general working capital and future development goals,” Country Garden said in a Hong Kong stock exchange filing.
China’s banking regulator has urged lenders to support the real estate sector and meet companies’ “reasonable financing needs” as analysts and policymakers fear financial contagion.
The real estate sector is estimated to account for 18-30% of the country’s GDP and is a key driver of growth in the world’s second largest economy.
Analysts have warned the industry is mired in a ‘vicious cycle’ that will further weaken consumer confidence, following the release of dismal second-quarter growth figures that were the worst since the start of the Covid pandemic -19.