Research On Debt Default Risk Of Real Estate Enterprises

In recent years,there have been frequent debt default events in the real estate industry.As of the end of March 2023,a total of 23 real estate companies in the industry have defaulted on their debts,with a default scale of 100.615 billion yuan.It ranks first in terms of default amount and quantity,with a clear industry bias.On July 8,2021,BRC Development Company issued a notice stating that it was unable to repay a total of 2.484 billion yuan of debt on schedule.As of June 30,2022,the company’s overdue debt principal was 34.337 billion yuan.In response to the above phenomenon,this article explores the following questions: How to effectively evaluate the risk of debt default? What are the common reasons for debt defaults in real estate enterprises and the individual reasons for debt defaults in BRC Development Company? How to control default risk?On the basis of summarizing the debt stock and default characteristics of real estate enterprises,this article selects data from Shanghai and Shenzhen listed real estate enterprises from 2019 to 2021,and uses independent sample T-test,non parametric test,and stepwise discriminant analysis to construct a Z-correction model that conforms to China’s listed real estate enterprises.At the same time,the model is tested using initial sample backtesting,proving that the constructed Z-correction model has strong applicability.Afterwards,the constructed Z-correction model was used to evaluate the default risk of listed real estate companies and BRC Development Company,and the indicators of the Z-model were applied to the financial analysis of BRC Development Company.The paper adopts a combination of theory and case studies,as well as a combination of quantitative and qualitative methods to further analyze the external and internal causes of debt defaults in BRC Development Company.This paper argues that: in terms of external factors,real estate enterprises are facing the pressure of structural adjustment under the New Normal of the economy,the operating pressure has risen sharply,and the financing cost has risen;The increase of industry concentration ratio,fierce competition and tight financing have increased the risk of default.In terms of internal factors,the financial situation of BRC Development is poor and financing is difficult;Strategic radicalism that deviates from national policies;Unreasonable corporate governance.The combination of the three factors increases the risk of default.Finally,it is proposed that the development of BRC should comply with national policies and formulate company strategies;Improve governance structure;Suggestions for improving financial situation and enhancing operational management level.This article conducts a study on the risk of debt default for real estate enterprises,constructs a modified Z model for listed real estate enterprises,analyzes default factors from both internal and external sources through typical cases,and proposes suggestions for controlling debt default risk.By constructing a warning model and analyzing the causes of debt default,we aim to assist real estate enterprises in assessing the risk of debt default,playing a warning role,and avoiding financial difficulties.