- [Narrator] Evergrande is the world's
most indebted real estate firm,
and it's been flooding its social media accounts
with videos like this,
showing that the company is back to work.
(speaking in foreign language)
- [Narrator] Meanwhile, buyers and real estate vloggers
are also taking to social media
to complain about construction delays
or that they haven't received their new homes.
The Wall Street Journal examined these posts
to understand why people are upset,
even as Evergrande has been trying to fulfill pledges
it has made to regulators to deliver more
than one million pre-sold homes.
If the company can't meet it's obligations,
consumer confidence could tank,
rippling through the Chinese economy
and potentially impacting the global economy.
- It has definitely turned
from being that prestigious developer giant
into something that everyone's concerned about.
- [Narrator] So we compared social media posts
from people waiting for homes they've already paid for.
And ones from Evergrande as it promises
to do whatever it takes to deliver them.
But first, here's how one
of China's largest property developers ended up
with so many stalled construction sites.
Pandemic lockdowns had hurt the company's sales
and new government rules kept it
from borrowing more money.
Then this past summer,
Evergrande said it was experiencing a cash crunch
and construction at many of its 778 projects
in 233 cities were halted.
All across China, the company has offices
and many have their own social media accounts on WeChat,
one of the country's most popular messaging apps.
We looked at content published by 20 of them
between September and November.
Most of the posts follow a similar pattern.
First, the company says it's working hard
to deliver homes and resume construction.
Then there are either videos or photos
of workers returning to empty project sites.
(speaking in foreign language)
- [Narrator] And testimonials from buyers
who've signed contracts to move into their new homes.
(speaking in foreign language)
- [Narrator] These homeowners
are among the many urban Chinese
who plowed their savings into new homes.
Collectively, they have nearly 78% of their wealth tied up
in residential property.
- The property market in China
is very important to its economy.
Real estate activity accounts
for roughly 1/4 of China's GDP and a central concern
for the government is making sure
that people get the properties that they paid for.
- [Narrator] Economists and real estate agents
in China say there's a lot at stake.
Evergrande has an estimated
1.4 million pre-sold apartments outstanding.
And if they aren't finished,
many households could suffer painful losses,
shaking confidence in the country's property market.
And a downturn in the world's second-largest economy
could spread to other countries trying
to bounce back from the pandemic.
- So Evergrande has to make this their priority as well,
and the best way to deliver the flats
is to find ways to resume construction.
- [Narrator] Local authorities
are also helping out the company.
Most of the cities with Evergrande projects
have set up task forces to help manage the process
and hired accountants to comb through their finances.
In early November, Evergrande said it had handed
over more than 57,000 homes between July and October.
- These announcements can give a bit of hope
to buyers who are in a desperate situation
of having poured so much money
into these unfinished apartments they've bought.
And this is probably just the beginning
of this colossal process
to restart constructions at these unfinished sites,
and many, many more are still waiting for their homes.
- [Narrator] And some of those waiting
have been using various social media platforms
to vent their frustration.
We looked at 20 posts from buyers
who said that construction appeared stalled
or doubted they would move into their new homes on schedule.
- I do want to point out
that some buyers have expressed relief on social media
about finally getting their homes
and that others also have complained about water
and gas leaks, or even unfinished interiors.
And people have seen empty construction sites,
so how the company is gonna turn around
will be scrutinized by people
because this involves something as intimate
and as important to them as their homes.
- [Narrator] Evergrande has promised home buyers
to deliver what they have paid for
but there are also unfinished buildings
with apartments that haven't been sold
and a lower priority for the company.
We looked at posts from real estate vloggers
who review property sites
and provide investment tips,
and they've been doing their own inspections
of Evergrande projects.
(speaking in foreign language)
- [Narrator] This footage was filmed
by real estate vlogger He Peiqi.
She went to this site called Evergrande City
in Hhhot, Inner Mongolia in November.
A month earlier, the company posted photos
of Evergrande City,
and said more than 1,400 apartments across six buildings
have been finished.
(speaking in foreign language)
- [Narrator] This footage shows
that about a month after that announcement,
Evergrande City had other buildings waiting
to resume construction.
Evergrande says it's working with the government
and in early December, the government of Guangdong,
the province where the company is based,
said it will send a working group
to help the developer work out its problems
and maintain normal operations.
Evergrande has around $20 billion worth
of outstanding dollar bonds
and it's managed to avoid defaulting on them
by making last-minute interest payments on deadline.
For this video, the company declined
to respond to requests for comment
on specific instances of delayed construction,
the poor quality of some finished homes
and whether the company was aware
of complaints on social media.
So until the home owners get the keys
to the apartments they bought,
they have social media to share their concerns with others
and check on the progress of their homes.
(pensive music)