The developer has been struggling to meet loan commitments following a crackdown launched earlier this year by the Chinese government. The tougher measures aimed to curb excessive borrowing and consumer speculation in the property sector.

On Thursday, Evergrande, the real estate giant with a presence in over 280 Chinese cities, defaulted for the first time on $1.2billion worth of bond debt.

The company’s total liabilities exceed $300bn (approx £224bn).

Fitch, an American credit ratings agency, stated confirmed the company had defaulted on its debt.

Following its missed payment, Evergrande status has been downgraded to a “restricted default” status by Fitch.

Fitch said the firm had not responded to a request for confirmation on the coupon payments, and it was therefore assuming the repayment had not been made.

It comes after Evergrande said there was “no guarantee” it could meet its debt repayments on Friday.

This week’s missed interest payment is the latest in a series for the company, which has missed many since late September.

Until this week, Evergrande had avoided default by transferring the funds before the end of 30-day grace periods.

READ MORE: Xi Jinping warned over Evergrande’s collapse as financial fears soar

Concerns have also been raised that the collapse of the company could trigger a financial crash akin to the overnight collapse of Wall Street’s Lehman Brothers in 2008.

Chinese authorities have appeared unlikely to allow the actions of 2008 to repeat though.

Analysts suggest that in order to protect its economy, Beijing would oversee a “controlled demolition” of Evergrande, which currently ranks as the world’s most indebted developer.

It is hoped that such a move would help to prevent a global crisis.

Robin Usson, credit analyst at Federated Hermes spoke of the defaults noting it would be “interesting” to see the role taken by the Chinese government when it comes to the two firms.

He said: “The defaults of Evergrande and Kaisa move us to the second step of this China Property downturn, with systemic risk being gradually replaced by idiosyncratic risk.

“It will be interesting to see the role played by SOEs (state-owned enterprises) in the restructuring process, the level of ‘control’ exerted by the government over this ‘marketed-oriented approach’.”

More than 10 Chinese real estate firms have defaulted in the second half of this year.

Neither Evergrande nor Kaisa, have yet to make any comments on the default reports and what they plan to do next.