China Evergrande’s Hui Ka-yan, once China’s richest man, has seen his wealth dwindle as developer’s prospects sour

Hui Ka-yan suspected of crimes subject to ‘mandatory measures’ by Chinese authorities as property giant struggles under massive debt pile
Hui’s empire reportedly included superyacht and London’s most expensive home

China Evergrande Group

Chad Brayin London

Published: 9:00am, 1 Oct 2023

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Born in a rural village in central China’s Henan province, Hui Ka-yan, the founder and chairman of troubled developer China Evergrande Group, rode a wave of market reforms in China’s property market over the past three decades to become, at one point, the country’s richest man.

The 64-year-old former steel mill worker amassed a vast empire that included China’s richest professional football club, a superyacht once valued at US$60 million and reportedly the most expensive home in London.

However, Hui, who is known as Xu Jiayin in the mainland, has seen his personal wealth dwindle in the past two years as the Shenzhen-based property developer has struggled under a suffocating pile of debt, which the company said totalled US$327 billion at the end of June.

On Thursday, Evergrande, now the world’s most indebted developer, confirmed that Hui was suspected of crimes by Chinese authorities and was placed under so-called mandatory measures, which can include house arrest. This followed the arrest of several top executives in its wealth management business earlier this month.

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It is a dramatic downfall for the billionaire, who regularly played poker with some of China’s biggest property magnates and was one of the assembled dignitaries alongside Chinese President Xi Jinping overlooking Tiananmen Square in Beijing just two years ago at a celebration of the Chinese Communist Party’s 100th anniversary.

Hui could not be located for comment and Evergrande did not respond to requests for comment.

Raised by his paternal grandmother after his mother’s death, Hui was born in 1958 and grew up in a village in Gaoxian, a township with a population of just under 50,000 in Henan province.

He studied metallurgy at the Wuhan Institute of Iron and Steel before starting out as a technician in a local steel mill.

Inspired by a series of reforms under Chinese leader Deng Xiaoping that opened the door for private housing to be built on communal land in China, he left his job in Wuhan in 1992 to pursue his fortunes in southern China.

Four years later, Hui founded Evergrande in Guangzhou, which grew to become one of China’s largest builders through a combination of heavy borrowing and selling affordable homes to China’s new crop of homeowners.

The company, which went public in 2009, eclipsed China Vanke as China’s biggest real estate company in 2016 and even made a failed bid that year to take over its rival, which had previously been viewed as the jewel in the crown of China’s developers. Evergrande also expanded beyond its property roots, into sectors including wealth management and electric vehicles.

Armed with his new-found wealth, Hui reportedly had a regular poker game with fellow property tycoons Henry Cheng Kar-shun of New World Development, CC Land Holdings’ Cheung Chung Kiu and Joseph Lau Luen-hung, the fugitive former chairman of Chinese Estates Holdings.

Childhood dreams fuelled a debt binge that is taken Evergrande to the brink

At the height of his fortunes, Forbes estimated Hui’s personal wealth at US$42.5 billion in 2017, making him China’s richest man. His wealth has now tumbled to US$3.2 billion, according to Forbes.

While Evergrande enjoyed contracted sales of 723.2 billion yuan (US$99 billion) at the end of 2020, this did not prove enough to service its burgeoning debt pile. Despite Hui reportedly selling off assets and injecting about US$1 billion of his personal wealth into Evergrande in July 2021 and the company offloading two Gulfstream private jets a few months later, the developer slipped behind on payments to suppliers, and ultimately defaulted on its dollar-denominated bonds in December 2021.

The superyacht Event docked in Hong Kong, China, in October 2021. Photo: Reuters

The company has been trying to restructure its offshore debt for the past two years, with Evergrande and Hui moving to sell off more of their trove of assets acquired during the company’s meteoric rise over the past 27 years. It sought Chapter 15 bankruptcy protection in the US in August, which is not uncommon in restructurings.

Evergrande’s Hong Kong headquarters was put up for sale last year by creditors as they sought to recover their debt, but the trophy 27-storey tower remains on the market. Evergrande acquired the building for US$1.6 billion – a then record HK$36,187 per square foot – in 2015.

The Event, a 60-metre (197 foot) superyacht, was reportedly sold for €30 million (US$32 million) this year. The yacht, which was built in 2013 and won a World Superyacht Award in 2014, was reportedly valued at about US$60 million two years ago.

Guangzhou FC, in which Evergrande owns a majority stake, was relegated from the Chinese Super League last year and an ambitious 100,000-seat stadium remains unfinished after the project was taken over by the local government following Evergrande’s financial troubles.

Evergrande: End of the road for developer as US$37 billion bill looms?

London’s most expensive home, a 45-room mansion overlooking Hyde Park, was put up for sale last year, with The Financial Times reporting that its ultimate owner was Hui. The property was acquired for £210 million (US$258 million) in 2020, with one of Hui’s tycoon poker buddies, Chung Kiu, acting as the public face of the deal.

Hui himself has generally remained out of the spotlight since Evergrande’s default. However in August of this year, public filings stopped listing Ding Yumei as Hui’s spouse, instead listing her as a “third party independent”. Ding owned 5.99 per cent of the company’s outstanding shares at the time, according to an August stock exchange filing.

Hui was last heard from in a voice clip circulated and verified by the company in December 2021, in which he instructed executives to speed up construction to ensure off-plan homes are delivered to customers. He last signed off the company’s exchange filings with the Hong Kong Stock Exchange on September 24.

Additional reporting by Yulu Ao