(Bloomberg) -- Shimao Group Holdings Ltd.’s global creditors are gearing up to organize themselves after the luxury builder defaulted on a $1 billion dollar bond due Sunday. 

Advisers to some of Shimao’s offshore bondholders are hosting calls late Tuesday in Hong Kong after the firm said Sunday it had hired advisers and hasn’t paid some of its offshore debts. Houlihan Lokey Inc. and Weil, Gotshal & Manges LLP are planning a call at 5 p.m. Hong Kong time Tuesday. Moelis & Co. is hosting a call at 9 p.m. later that day, according to a Debtwire report.  

The emergence of multiple creditor groups after a default can make it harder for bondholders to advocate for their interests, particularly if rival cohorts are formed. Houlihan and Weil are advising a large holder of Shimao’s bonds and looking to expand the group while Debtwire reported that Moelis & Co. wants to grow the ad hoc group of offshore bondholders that it is advising. A representative for Moelis didn’t immediately respond to request for comment. 

“For offshore investors, the key worry is that Shimao will likely prioritize payments to onshore creditors,” said Leonard Law, senior credit analyst at Lucror Analytics. “The restructuring process will certainly be lengthy, given that the company has a large amount of off-balance-sheet debts that need to be accounted for” and offshore bondholders generally have little ability to influence outcomes, he added. 

Shimao, whose landmark projects included five-star hotels in Shanghai, was once considered largely immune to the sweeping crackdown that has engulfed larger peers like China Evergrande Group and Sunac China Holdings Ltd. Though its dollar bonds have been trading at distressed levels for several months, mounting worries about its financial health since late last year are a sign that stress is taking its toll on a widening set of players.

The country’s 14th-biggest developer last year was once popular with global investors who had considered it a safer name. Any possible restructuring at the firm will be closely eyed by other global creditors already grappling with the consequences of more than $25 billion dollar bond defaults in the offshore market this year. 

“The Shimao default shows that the property restrictions are increasing the stress on the developers and the government is not backing down from reducing property prices,” said Andrew Collier, a managing director at Orient Capital Research Inc. “Restructuring, even among private developers, will have to wind their way through local governments politics and state firms, which will cause delays.” 

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