SHANGHAI, Oct. 11 (Reuters) – Fundraising for Chinese real estate trust products fell more than 40% in September from the previous month, the Shanghai Securities News official reported on Monday, as problems at the China group Evergrande further curb investor appetite for this troubled sector.
The new real estate trust products raised 16.2 billion yuan from investors in September, down 44.8% from the previous month, the newspaper said, citing data from investment advisory Usetrust. This follows a 24% drop in August and a 25% drop in July.
Evergrande’s financial woes (3333.HK) worsened in September, as the developer, struggling with debts of over $ 300 billion, missed payments on wealth management products, commercial invoices and dollar bonds.
Chinese developers are already struggling with government credit restrictions and soaring bond issuance costs. A rapidly shrinking real estate trust product market could further narrow the financing channels of an industry suffering from a slowdown in home sales.
In contrast, trusted products that funnel money into capital markets have seen their popularity and fundraising increase, according to the Shanghai Securities News.
Reporting by Samuel Shen and Andrew Galbraith Editing by Shri Navaratnam
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