Commercial realty risks
Commercial real estate is showing signs of a bubble, as some companies have witnessed a liability ratio between 100 and 300 percent, higher than the 70 percent designated by the banks, Li Guibin, board chairman of Beijing-based Glorious Oriental, a commercial real estate company, said at a forum hosted by China Commercial Real Estate Association over the weekend in Beijing.
Li also said that overcapacity and high interest rates from banks also raise costs for developers and make the capital chain tight.