Chinese Estates Holdings, a major ally of heavily-indebted Chinese developer China Evergrande Group controlled by the family of fugitive property tycoon Joseph Lau Luen-hung , swung to a loss last year as China’s housing market soured. The Hong Kong developer, chaired by Joseph Lau’s son Lau Ming-wai, 41, reported a loss of HK$3.5 billion (US$447 million) for 2021, having recorded a profit of HK$622.2 million the previous year. The company said in a filing to the Hong Kong exchange on Monday that the loss was mainly due to a decline in dividend income from China Evergrande shares, and losses from Chinese Estates’ equity and bond investments . “It is expected that the group’s investment properties will continue to face numerous challenges in the short run,” the company said in the filing. Thanks to a friendship and alliance forged through weekly card games going back more than a decade, Chinese Estates was involved either as a buyer or seller in almost every financial transaction by China Evergrande since founder Hui Ka-yan – a close friend of Joseph Lau’s – listed his property company for HK$6.5 billion in Hong Kong. Chinese Estates to post US$190 million loss from sale of Evergrande shares Chinese Estates has disposed of more than 630 million China Evergrande shares, recording a loss of HK$7.9 billion, amid the liquidity and debt crisis at the latter. China Evergrande’s shares plunged by about 90 per cent last year, as it failed to pay its suppliers and investors in high-yield wealth management products, and officially defaulted on its dollar bond last December. The developer’s net dividend income from shares of China Evergrande was HK$156.5 million last year, falling far short of the HK$1.9 billion recorded in 2020. It also suffered an investment loss of HK$2 billion from the shares and bonds it holds, turning from a gain of HK$2.07 billion the year before. Troubled tycoons: Evergrande’s Hui Ka-yan and ally Joseph Lau through the years Chinese Estates’ revenue dropped about 60 per cent to HK$1.3 billion in 2021, from HK$3.04 billion the previous year, the company said in its filing on Monday. The developer said the outlook for the sector remained dim because of an uneven global economic recovery, the spread of the Omicron variant, supply-chain snarls and inflationary pressures. Joseph Lau, the developer’s former CEO, is the sixth richest man in Hong Kong with a net worth of US$13.6 billion, according to Forbes . He was convicted of bribery and money laundering in absentia by a Macau court in 2014, but avoided a five-year jail term by not travelling there. In 2019, he filed a lawsuit, which was later withdrawn, to challenge the Hong Kong government’s proposed extradition bill that triggered the city’s worst political crisis in decades.