China Vanke hit with fresh S&P downgrade amid mounting default concerns

Once a bellwether for China’s property sector, China Vanke now faces a CCC- rating, negative CreditWatch and a tight refinancing window

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The downgrade reflected Vanke’s “unsustainable” financial commitments, according to S&P ratings agency. Photo: Shutterstock

Published: 6:44pm, 28 Nov 2025

Global ratings agency S&P has downgraded China Vanke, as the troubled developer grapples with mounting debt and fragile cash flow, raising concerns about a renewed liquidity crisis across the country’s real estate industry.

S&P on Friday cut Vanke’s long-term issuer rating to CCC- from CCC and likewise lowered the long-term issue rating on senior unsecured notes of its Hong Kong subsidiary, marking the second downgrade for the developer in less than a month.

All ratings were placed on CreditWatch with negative implications, it said.

The decision reflected Vanke’s “unsustainable” financial commitments, S&P said, citing weak liquidity and a looming bond maturity of about 11.4 billion yuan (US$1.6 billion) between December 2025 and May 2026.

“Over the next six months, the company faces a sizeable bond maturity wall while operating cash flow will be negative, and its accessible cash buffer will likely be thin,” the ratings firm said.

“The company’s debt obligations are currently vulnerable to risks of non-payment or distressed restructuring,” it added.

The downgrade followed a media report earlier this week saying the Shenzhen-based developer could be asked to adopt more “market-oriented” measures to handle its debt, implying that the firm may face a restructuring.

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