(Bloomberg) -- Distressed Chinese developer Country Garden Holdings Co. has passed an initial deadline to pay dollar bond interest with holders yet to receive the money, keeping the threat of a first default looming.

The builder, which has become a symbol of China’s broader property debt crisis, had to pay $15.4 million of interest by Monday on the note. Two holders said they hadn’t gotten payment as of 3 p.m. Hong Kong time Tuesday. Country Garden didn’t comment when reached. There’s a 30-day grace period before a default can be called.

Once China’s largest developer, Country Garden has been engulfed in a broader property debt crisis and warned last month it may default. Fresh concerns about broader financial market contagion from China’s property sector flared last month when the firm missed paying $22.5 million of interest on other dollar bonds by an initial deadline.

It wound up honoring that obligation at the last-minute earlier this month just as grace periods were ending. But deep distress persists at the company, which is one of the world’s most heavily indebted developers with 1.36 trillion yuan of total liabilities.

Other Chinese developers have also been leaving some investors waiting until the last minute for cash for several years. Some of the sector’s most high-profile defaulters, including China Evergrande Group, made bond payments during grace periods before eventually stopping remittances.

Onshore Extensions

Country Garden this week won bondholder approval on the last of a batch of eight local notes it sought to stretch out repayments on, after the vote was extended three times and a proposal to add a credit enhancement was made.

Two bondholders said they were briefed by an underwriter Tuesday that the proposal to extend the 492 million yuan ($67 million) note was passed. They asked not to be named discussing a private matter. The vote’s latest deadline was Monday. Country Garden didn’t offer a comment when reached.

A Monday filing to the Shanghai Stock Exchange’s private disclosure system seen by Bloomberg News said that Country Garden unit Guangdong Giant Leap Construction Co. would provide no less than 200 million yuan as a pledged guarantee for the note if the payment extension passed. The credit enhancement proposal was added on Monday, according to one person familiar with the matter. The unit issued the bond.

Country Garden last week won approval from bondholders to extend seven other onshore notes. Along with another bond extended earlier this month, the nine notes’ combined principal is 14.7 billion yuan. The extensions provide the company with breathing room as it deals with plunging contracted sales and other debt obligations. 

Most of Country Garden’s dollar bonds have fallen to deeply distressed levels below 10 cents after some were near 80 cents in June. 

--With assistance from Dorothy Ma.

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