Property developers are caught..........>

CHINA PRESS: Property developers are caught between adding leverage and

deleveraging, the 21st Century Business Herald reported Thursday. During a time

when China is campaigning for deleveraging, property companies are under

pressure to avoid losing out during consolidation in the sector that has

resulted from government controls. At the same time, they need financing to

acquire land and are afraid of losing investment opportunities. Some property

developers are aggressive in acquiring land, even resorting to using

off-balance-sheet credit, such as private financing, which usually has a high

interest rate. An unidentified expert told the newspaper that the debt ratio of

property developers has edged up amid the new consolidation cycle. The pressure

on developers to translate investment into revenue has become more intense and

the financing environment has tightened, making debt management more difficult.

The expert warned that some property developers' aggressive land and project

acquisitions are like gambling: if they make the right judgment, they could

boost their growth; if not, they could be stuck in a debt crisis and be acquired

by other companies. (21st Century Business Herald)