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Bond Market News
Country Garden’s May Sales Decline Amid Restructuring Challenges
June 9, 2025
Country Garden (COGARD) saw its May sales decline by 28% YoY to approximately RMB 3.1bn ($431mn). This decline was notably steeper than the 8.6% average drop experienced by China’s top 100 developers. The property firm also anticipates that its full-year contracted sales for 2025 could fall by as much as 36% YoY. According to Bloomberg, the continued weakness is attributed to factors such as falling consumer prices and persistent concerns among buyers regarding developers’ ability to complete projects on schedule.
COGARD has been engaged in restructuring discussions for over a year following its debt default. Its offshore restructuring plan, totaling $14.1bn, faces resistance from a key group of banks, who have indicated that failure to meet certain demands would constitute a “deal breaker”. The company requires support from at least 75% of debt holders across both its bank lenders and bondholders to pass the plan. While it reportedly has the backing of 70% of bondholders, bank creditor approval remains crucial. Separately, COGARD has received a reprieve for its liquidation petition hearing, with the next session scheduled for August 11.
Its dollar bonds are trading stable, albeit at deeply distressed levels of 7-8 cents on the dollar.
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