The ripple effects of China Evergrande Group's stagger toward insolvency have reached American shores.

China Oceanwide Holdings Group, with $3.5B worth of unfinished developments in U.S. markets, is unsure about its ability to continue operations as it struggles to raise capital through refinancing or asset sales, Bloomberg reports. Work has stopped on its Oceanwide Plaza megaproject in Los Angeles, where two apartment buildings and a hotel topped out three years ago, and at Oceanwide Center in San Francisco, which is supposed to become the city's second-tallest building but remains a hole in the ground.

Oceanwide launched both of those projects, as well as plans for a skyscraper in the South Street Seaport area of Manhattan, before China cracked down on foreign investments by its country's companies in 2018. By 2019, it was marketing all three projects for sale, as well as properties on the Hawaiian island of Oahu, through brokerage firm JLL. A 1950s-era building still stands on the site of Oceanwide's New York proposal, Bloomberg reports.

Attempts to sell off its U.S. holdings have so far not borne fruit, even though a deal to sell Oceanwide Center in San Francisco for $1B made it as far as the due diligence phase before the coronavirus scuttled the deal, with another sale agreement falling apart at the due diligence phase months later, Bloomberg reports. Attempts to refinance debt on those projects have met only limited success, with some of its creditors agreeing to extend repayment deadlines into next year.

Oceanwide's U.S. projects could be completed by some of the country's biggest developers, such as Brookfield Asset Management, Related Cos. and Hines, but only Hines has acknowledged considering making a deal, Bloomberg reports. Complicating matters is the lack of confidence that capital markets have right now in the health of a Chinese real estate company, especially one that is highly leveraged.

Since President Xi Jinping set a policy ordering real estate companies in China to reduce their debt, Evergrande's longtime strategy of heavy borrowing put it between a rock and a hard place. The company had racked up $305B in debt with hundreds of projects under development across the country, and without the ability to borrow more, it doesn't have the requisite cash to pay back its vendors and meet payment deadlines on some of its loans and bonds.

Oceanwide and Evergrande have spent the past couple of decades expanding into more varied business lines, which in Evergrande's case increased the possibility that a collapse would impact enough other companies to cause a broader downturn. Evergrande's debt load alone amounts to 1.8% of China's economy, Real Money reports.

Despite the risks, Xi has indicated that no bailout of Evergrande is forthcoming, with the Chinese central government instead directing regional administrations to prepare for taking over unfinished projects and paying Evergrande's vendors, The Wall Street Journal reports. The government's hard-line stance against stabilizing even one of its largest companies likely means that Oceanwide is on its own in its fight to survive.