(Yicai) Aug. 22 -- Twenty Chinese property developers have won approval for their debt restructuring plans since the start of the year, clearing more than CNY1.2 trillion (USD167 billion) in liabilities, according to the latest figures from the China Index Academy.

As of early this month, developers that have completed both domestic and offshore debt restructurings include Sunac China Holdings, China Aoyuan Group, and Sino-Ocean Group, according to the think tank’s analysis of about 60 distressed property firms reporting progress on debt restructuring or corporate reorganization.

Those that have obtained approval for offshore debt restructuring include Shimao Group Holdings, Greenland Holdings and Country Garden.

Developers are now focusing on more practical restructuring plans, such as cash buybacks, debt extensions, as well as debt-for-equity swaps, to avoid the pitfalls faced by firms that completed debt restructurings early. Many of these fell back into crisis after misjudging the impact of the property market downturn and have triggered a new wave of corporate rescue efforts.

For instance, Guangzhou R&F Properties was the first builder to secure extensions on all of its onshore and offshore debt at the end of 2022, but ran into trouble again last year. Similarly, Modern Land restructured its overseas debt in 2022 and reached an agreement on the roll over of domestic liabilities, only for the firm to have since defaulted again.

Most troubled developers face tight cash flows, and with many of their assets devalued or pledged as collateral, few high-quality assets remain to repay debt, according to researchers at CRIC. As a result, debt-to-equity swaps have become the default option for those trying to restructure, with the main goal being to cut overall debt levels. Most are looking to slash debt by about 70 percent.

Editor: Kim Taylor