China SOE Land Binge as "Posion Pill"

Last month: Flour More Expensive Than Bread: Second Tier Land Prices Soar 180 pc

WSJ picks up on the trend with a good write-up: Why China’s Developers Can’t Stop Overpaying for Property
The domestic bond market and growth in asset-backed securities have made financing easier for developers, causing companies to chase whatever assets they can. Continuing reforms of state-owned enterprises could also be a trigger, as these firms have incentives to inflate their balance sheets to gain clout in consolidation talks. For some which have already invested heavily in real estate, keeping land prices high makes sense.
In a free market, what these SOEs are doing approximates a poison pill. Loading up the balance sheet with debt and overpriced assets, but in China, this could allow the company to puff itself up and obtain a superior position in negotiations. In a free market, these firms would be punished severely. In China, they could be the winners from SOE reform.

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