HONG KONG >> Chinese property developer Country Garden warned today that it cannot repay on time a 470 million Hong Kong dollar ($60 million) loan in the latest sign of distress after Beijing clamped down on mounting debts in the industry.

The company said in a filing to the Hong Kong Stock Exchange that it “expects that it will not be able to meet all of its offshore payment obligations when due or within the relevant grace periods,” including U.S. dollar notes the firm has issued.

The company said its sales were under “remarkable pressure.”

Country Garden earlier had been hailed as a model real estate company by Chinese authorities. It had avoided defaults on debt even as rivals such as China Evergrande, the world’s most heavily indebted property firm, defaulted in 2021 after the Chinese government began restricting borrowing by developers.

The company’s Hong Kong-traded shares sank 10.7% today.

Its liquidity crisis suggests developers remain under pressure even after regulators lifted some controls on housing purchases to alleviate troubles in the industry. That has raised worries that the industry’s troubles could shake financial markets or spill into the wider economy. But the crisis has played out very gradually. Hong Kong’s Hang Seng index gained 0.8% today. Evergrande’s shares lost 3.6%.

Country Garden recently has received loans from some banks, such as a $50 million loan from China Minsheng Banking Corporation earlier this year, on top of a separate $280 million loan from the Hong Kong unit of the Industrial & Commercial Bank of China in December 2022.

Country Garden’s sales slumped nearly 44% in January-September from the same period a year earlier, the company said. Since there has not been an industry-wide improvement in property sales, Country Garden said “its liquidity position is expected to remain very tight in the short- to medium-term.”

However the company is still finishing and delivering residential housing. It said it had delivered 420,000 apartments in January-September and 700,000 in 2022.

Last month, the company made interest payments on two securities before the end of a 30-day grace period. Country Garden had more than $180 billion in liabilities as of June. Evergrande has debts amounting to more than $300 billion.

Last month, a former Chinese official estimated that even China’s 1.4 billion population would not be able to fill all the vacant homes across the country. But housing construction is a major driver of the economy, fueling demand for materials, appliances and all sorts of products. Sales of land for development also are an important source of funding for local governments.