China is about to be littered with even more “ghost cities” as one of the nation’s biggest land developers faces collapse. One of China’s largest developers, Zhejiang Xingrun Real Estate Co., also has one of the largest debts to repay.
According to various reports, Xingrun has more than 3.5 billion yuan, around $570 million, in debt, and will leave several partially completed projects across the country empty, adding to the nation’s eerie collection of “ghost cities.”
Ghost cities are the result of prematurely built and underfunded urbanization projects that lose backing midway through completion. Because of China’s breakneck economic growth, projects were started all over the nation and they are are now being affected by China’s intentionally slowing economy and cooling real estate market.
As China’s real estate market remains healthy in top-tier cities like Beijing and Shanghai, the collapse has hit many of the nation’s tier 3 and 4 cities and other areas that have prematurely pushed for urbanization. Permanent reminders are seen in various half-built extravagant structures and abandoned large scale projects in some of the most rural areas.
The collapse of this particular company will result in ghost cities reaching the city of Ordos, located in China’s northern Inner Mongolia province.