China Vanke Co. is racing to avoid default by seeking to delay payment on a yuan-denominated bond due this month, according to people familiar with the matter. The troubled developer has proposed an offer to bondholders that would repay 40% of the principal upfront while extending the remaining 60%, marking another high-stakes move in China's ongoing property sector crisis.

This latest maneuver comes as Vanke joins a growing list of Chinese real estate companies struggling with massive debt loads and declining sales. The property giant, once considered among the more financially stable developers, has seen its liquidity position deteriorate amid broader market weakness. The proposed bond extension highlights the mounting pressure on even the strongest players in China's real estate sector.

Vanke's move underscores the deepening challenges facing China's property market as developers grapple with refinancing risks and falling home prices. The outcome of this bond restructuring could have significant implications for other Chinese developers with similar debt profiles. With the property sector accounting for roughly 25% of China's GDP, any default by a major player like Vanke could ripple through the broader economy.