China Vanke Shares Plunge After Bondholders Reject $1.2B Debt Restructuring Plan

China Vanke Co. shares dropped 12.3% following the rejection of a critical debt extension proposal by bondholders, underscoring escalating financial strain. The move heightens default risks and raises concerns across China's real estate sector.

China Vanke Co. (000002.SZ, VKHAY) saw its stock fall sharply by 12.3% on December 15, 2025, after bondholders overwhelmingly rejected a proposed extension of a $1.2 billion offshore bond maturity. The restructuring plan, aimed at delaying repayment for 18 months, was backed by only 38% of participating bondholders, falling far short of the 75% threshold required for approval. The failed proposal reflects deepening investor skepticism toward Vanke’s ability to manage its debt load amid a prolonged property market downturn. The company currently carries over $30 billion in total debt, with nearly $8 billion due within the next 12 months. The rejection increases the likelihood of a formal default on the affected bond tranche, triggering cross-default clauses on other obligations. Market reaction extended beyond Vanke’s equity, with the broader CSI 300 Real Estate Index declining 4.1% in early trading. Several other developers, including Sunac China and Evergrande Group, also saw their bond prices drop, signaling contagion risk across the sector. Analysts note that investor confidence in Chinese property firms has eroded as liquidity pressures mount and sales volumes remain below pre-2021 levels. The outcome may prompt regulators to reassess support measures for the real estate sector, particularly as defaults by major developers threaten financial system stability. Vanke’s management has signaled it is exploring alternative financing options, including asset sales and equity infusions, though these remain uncertain.