Repayment Risk of Debts in Real Estate Corporations

摘要

Profitability is one of the most basic protections to payoff debts and interests in Real Estate Corporations. To a real estate corporation, the investing profitability is uncertain, but its debts are related certain. Repayment of debts and interests would be enlarged for such mismatching between investing profitability and due debts. Consideration of repayment and refluxing of debts during investing period, the real estate corporation should pay close attention to the impacting effect which would act on the normal operation. In fact, it is more often that real estate corporations dressed into financial distress than bankruptcy. Therefore, relations between risk and term structure of debts will be analyzed connected with the real case of the real estate corporation. Moreover, impacting effect from refluxing of debts to operation and project cash flow will be measured. In the end, the feasible sinking fund or reserve fund model for debts risk will be discussed.