Chinese developer Shimao plans fire sale after downgrade and missed payment

Fears over contagion mount as a company once considered financially sound is running out of cash to pay its debts

A Chinese developer previously considered financially sound is embarking on a fire sale of assets as the contagion of bad debts built up within China's bloated housing sector continues to spread.

Shimao Group Holdings, which is in the top dozen Chinese property companies, was plunged into crisis after it said it defaulted a trust loan last week after missing a 645m yuan ($101m) payment that it guaranteed.