Two more Chinese developers have failed to meet dollar-bond payments, occurring amid renewed home-sales softness and a lack of aggressive stimulus.

Central China Real Estate Ltd. said it didn’t pay interest on a note before the end of a grace period on Friday and that it would suspend payments on all offshore debt. Smaller peer Leading Holdings Group Ltd. disclosed in its own exchange filing Friday night that it hadn’t paid the entire $119.4 million of principal plus interest due on a dollar bond issued a year ago as part of a debt swap.

Both firms also said they will engage with external advisers and work on holistic solutions for their offshore debt. Central China is the country’s 33rd-largest builder by contracted sales, according to China Real Estate Information Corp., while Leading Holdings isn’t in the top 100.

The delinquencies followed several Chinese builders last week remitting funds for interest payments at the end of 30-day grace periods or shortly afterward. The property sector’s unprecedented cash crunch resulted in record defaults on Chinese issuers’ dollar bonds last year and still-elevated missed payments so far in 2023.

Expectations have been growing that Chinese officials will unveil more stimulus for struggling sectors including real estate. But investors were left disappointed last week after Chinese banks cut their mortgage reference rate by less than some anticipated. A slow stimulus rollout is adding to concerns about the country’s economy.

“China’s developers continue to face skepticism from investors amid a renewed slowdown in sales, and refinancing could be selectively extended by banks even post the 16-point plan,” said DBS Bank Ltd. strategist Chang Wei Liang.

Central China’s announcement likely isn’t a big market surprise given trading levels for the firm’s shorter-term dollar bonds, according to Zerlina Zeng, senior credit analyst at CreditSights. “Most smaller privately owned developers still face dire liquidity conditions because of the muted recovery of contracted sales,” she said.

The company’s notes fell as much as 4 cents Monday, outpacing declines of as much as 0.5 cent in China’s builder-dominated high-yield dollar bond market, according to credit traders. Chinese assets were broadly lower, with equities and the yuan weakening on fresh signs of slowing economic momentum.

The Central China and Leading Holdings notes on which payments weren’t made have been indicated at below 30 cents on the dollar much of this year, according to data compiled by Bloomberg. Such prices are generally considered deeply distressed levels and signal investor doubts about on-time payment.

Central China’s parent sold a 29% equity stake in the builder less than a year ago to a government-owned entity in its home province of Henan. Market optimism, stoked by hopes the move would provide state support to the builder, didn’t last. Central China exchanged three dollar notes in April that were due to mature in 2023.

--With assistance from Pearl Liu and Lorretta Chen.

(Adds market performance in the eighth paragraph.)