Slowing demand may hit real estate companies: Fitch

The slowdown would mainly affect the smaller real estate companies while increasing the relative strength of some large players, the report said. “The slowdown will also aid the process of weeding out some of the weaker entities within the sector, and increasing the relative strength of some of the larger, more established developers.” Besides, high liquidity risks on account of significant repayments falling due in the present year, would remain as a key challenge across the board, the rating agency said. Some smaller players may end up either refinancing at materially high rates of interest, or could default on their obligations. However, the larger, established and well-capitalised companies with access to banks/financial institutions, would remain better positioned to manage this risk. The prolonged slowdown could also reduce the appetite of private equity, it said.