A midsize Chinese real estate developer missed a $282.1 million bondholder payment today, adding to the industry’s financial woes as one of the country’s largest developers fights to avoid defaulting on billions of dollars in debt.

Like its larger rival, China Evergrande Group, Fantasia is based in Shenzhen and has struggled with excessive debt due to the financial crunch.

In a statement made through the Hong Kong Stock Exchange, Fantasia Holdings Group said it had missed the payment, 9News reported.

Since Sept. 29, the company’s stock has been suspended pending the announcement of another asset sale. So far this year, they’ve dropped 58.5 percent.

Over the last year, Beijing has taken steps to limit excess leverage in the property sector to reduce financial system risk, preventing stretched developers in the world’s second-largest economy from refinancing debt.

After regulators tightened constraints on their use of borrowed money last year, some Chinese developers are struggling to repay their debt.

This is driving fears of possible defaults and financial market instability.

Investors are concerned that Evergrande Group, which owes $425 billion in debt, would fail.

Although the company has missed at least one payment to foreign bondholders, it has not been declared default.

Economists said if Evergrande defaults, Beijing can forestall a bigger credit crunch, but it does not want to bail out the company or its creditors to remind other borrowers and lenders to be more conservative.

Fantasia stated it had failed to redeem a $205.7 million bond due that day in a Hong Kong filing on Monday evening, Oct. 4. It also defaulted on a 700 million yuan ($108.56 million) short-term loan to Country Garden Services Holding, which is in the process of purchasing much of Fantasia’s property management company, according to Nikkei Asia.

According to the bond offering prospectus, Fantasia has a 30-day grace period to repay the five-year bond before formally defaulting.

On Tuesday evening, Oct. 5, the S&P Global Ratings downgraded the company to “SD” (selective default).

“The nonrepayment of principal will likely trigger cross defaults in Fantasia’s outstanding bonds,” it said. “It could also accelerate repayments on the company’s other debt. Creditors may seek early repayment owing to Fantasia’s deteriorating credit profile.”

Before S&P’s decision, Moody’s Investor Service reduced Fantasia’s rating by four notches from “B3” to “Ca,” one rung over default. On Monday, Fitch Ratings downgraded the company’s rating from “B” to “CCC-.”

Since regulators tightened control over the industry’s funding in 2017, amid concerns about mounting debt and the potential of a financial disaster, hundreds of smaller Chinese developers have gone bankrupt.

Another developer, Fortune Land Development Co, announced in March that it had missed $1.1 billion in interest and loan payments.

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