Real estate once served as a vital growth engine for the world’s second-largest economy, undergoing two decades of dazzling expansion as living standards rose across the country.

But the sector has faced unprecedented headwinds in recent years, with major firms failing to follow through on projects and a clampdown on property market speculation by Beijing.

Many industry juggernauts are now either on the verge of bankruptcy or in dire financial straits.

Shenzhen-based Kaisa, which has nearly 17,000 employees, in 2015 became the first Chinese real estate group to default on dollar-denominated bonds before charting a financial recovery.

But the property crisis of recent years again weakened the firm, whose total debt was estimated at 226.4 billion yuan ($31.7 billion) at the end of 2023.

Kaisa announced Tuesday that it had entered into a “restructuring support agreement” with creditors for a partial repayment of its debt, according to a stock exchange statement in Hong Kong, where it is listed.

The firm is now committed to issuing new bonds totalling $5 billion.

The deal comes as other Chinese property giants including Evergrande and Country Garden struggle for survival.

Country Garden—a private developer long considered financially sound before buckling under major debt —faces a hearing at a Hong Kong court in January 2025.

Unless a plan for restructuring is reached before then, the company could be ordered into liquidation.