Chinese property developer Country Garden Holdings Co. has defaulted on dollar bonds for the first time, highlighting its distress.
The builder, among the world’s most indebted developers, didn’t pay $15.4 million of dollar bond interest by the end of a 30-day period after missing the initial deadline of Sept. 17.
And so this failure to pay interest during the grace period that ended last week “constitutes an event of default,” according to a notice sent to note holders by trustee Citicorp International Ltd.
The firm has yet to officially default on any onshore bonds. It won noteholder approval in September to extend payments on nine onshore securities with a combined 14.7 billion yuan of principal.
Underscoring the depth of the problems, Country Garden recently said that its September contracted sales tumbled 81% from a year earlier.