A group of China Evergrande Group’s offshore bondholders said the property developer had not engaged with them since missing interest payments on two dollar-denominated bonds in September, and that they were concerned about potential asset flows to other creditors. The first public comments from offshore bondholders about the missed payments came as property agency Centaline Group separately filed two lawsuits, claiming it was owed more than HK$100 million (US$12.8 million) in unpaid commissions from flat sales at two Evergrande projects in Hong Kong. On a conference call on Friday night, representatives for an ad hoc group of offshore bondholders that holds about US$5 billion of Evergrande’s debt said they first approached the company and its advisers on September 16, but – beyond a few calls with its advisers – had not had a “meaningful dialogue” with the company. “We are really here to engage constructively with the company and we want the company to address its challenges. We are appreciative of all of the challenges it is facing,” said Bert Grisel, a managing director a Moelis & Company, which is representing the bondholders. “We also don’t want the offshore lenders to be an afterthought or in a different position.” Evergrande did not immediately have a comment when contacted for this story. The company, the world’s most indebted property developer, missed about US$129 million in interest payments due September 23 and September 29 on the two dollar-denominated bonds, the bondholders’ representatives said. It could be declared in default after a 30-day grace period, which several credit-rating agencies have said was likely to happen. Evergrande, which was the biggest residential property developer by sales in China last year, is facing questions about its ability to service its massive debt load , particularly after it failed to repay contractors and suppliers on time. The company is undergoing a cash crunch as it stares down 1.97 trillion yuan (US$305 billion) in total liabilities. In August last year, the People’s Bank of China adopted new “three red lines” requirements to measure the debt levels of property developers and limit their ability to borrow if they were overleveraged. It was part of Beijing’s efforts to tamp down speculative property price bubbles, but has hampered the short-term liquidity of developers, such as Evergrande. Evergrande and other mainland property developers are likely to have shifted some of their interest-bearing borrowings to debt held off balance sheets, as well as to commercial paper, wealth management products and perpetual capital securities, to appear to comply with Beijing’s deleveraging push, according to JPMorgan Chase analysts. “Although, peers have likely done similar window dressing too, Evergrande’s is one of the most aggressive,” JPMorgan property analysts Karl Chan and Elaine Wu said in a research report. “It is possible that the real gearing could be even higher, as data on some off-balance-sheet debt is not publicly available.” The company’s net gearing, a measure of its financial leverage, should be at least 177 per cent in the first half of the year based on public information, rather than the 100 per cent reported, they said. Net gearing refers to a company’s ratio of debt to equity. Other developers that are likely to have higher net gearing ratios once you adjust for off-balance-sheet debt include Guangzhou R&F Properties, China Sunac Holdings and Country Garden, according to JPMorgan. In an effort to repay its suppliers and stave off its liquidity crisis, Evergrande has been turning over properties to suppliers and selling some of its assets. The ad hoc committee of bondholders is concerned about these asset sales disadvantaging other creditors, particularly offshore holders of its debt, said Neil McDonald, a partner at the law firm Kirkland & Ellis, which is also advising the bondholders’ group. Evergrande said on September 29 that it would sell a 19.93 per cent stake in Shenjing Bank for just under 10 billion yuan to a state-owned enterprise to settle liabilities with the lender. It is the second time this year that Evergrande has sold holdings in the bank. Its shares have also been suspended since Monday in anticipation of a potential sale of a controlling stake in its unit, Evergrande Property Services Group. Evergrande said its shares were halted ahead of an announcement about a “major transaction” , but no announcement has materialised yet. China-based developer Hopson Development is said to be buying a 51 per cent stake that values Evergrande’s property management unit at HK$40 billion, according to a report by Chinese financial news portal Cailian, which cited people familiar with the matter. Hopson’s shares have also been suspended from trading in Hong Kong this week for a potential takeover announcement. “What we don’t want [is for] it to have a situation where so-called offshore assets are being monetised in some way and the value of those assets are being leaked to other parties – onshore or elsewhere,” McDonald said. Evergrande’s legal woes have been multiplying recently. On Thursday, Centaline sued two Evergrande units in High Court in Hong Kong, seeking to recover HK$90.3 million in unpaid commissions from the sale of 401 flats at the Emerald Bay project in Tuen Mun and HK$16.4 million from the sale of 42 units at The Vertex development in Cheung Sha Wan. Centaline founder Shih Wing-ching has said Evergrande owes the company HK$200 million in overdue commissions from its projects in Hong Kong and the mainland. Two property agencies affiliated with Hong Kong-listed Midland Holdings also sued earlier this week to recover HK$43.45 million in overdue commissions for the sale of flats at Emerald Bay and The Vertex.