Why was Evergrande ordered to demolish 39 buildings?

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Evergrande Ordered to Demolish 39 Buildings Due to Illegal Construction on Artificial Archipelago

Evergrande has been ordered by authorities to demolish 39 buildings at its “Ocean Flower Island” development in Hainan province because they were constructed illegally on an artificial archipelago. This directive was issued on December 30 and specifically impacts one plot of land within the larger resort project.
Illegal Construction on Artificial Land

The demolition order stems from the determination by authorities that the structures were built illegally. The development in question is situated on an artificial archipelago in Hainan, a region known as a significant tourist hub. The specific plot of land affected by the decision on December 30 was the site of these illegal constructions.
Company's Response and Communication

In response to the order, Evergrande has stated its intention to actively communicate with the relevant authorities. The company plans to follow the guidance provided in the decision letter to properly resolve the issue. This announcement was made to the Hong Kong stock exchange.
Broader Context of Evergrande's Financial Difficulties

This demolition order comes at a time when Evergrande is facing significant financial distress, grappling with over US$300 billion in liabilities. The property giant has been struggling to meet its repayment obligations to bondholders and investors following a crackdown by Beijing aimed at curbing excessive debt within the real estate sector. The company's shares experienced volatility, including a day-long trading suspension prior to this confirmation.

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Why was Evergrande ordered to demolish 39 buildings?

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