J.P. Morgan warns that Chinese REITs’ 2.8 trillion yuan ($385.78 billion) assets are at risk due to a “vicious cycle” of real estate financing issues.

Country Garden, China’s largest private developer, plans to defer payment on a private onshore bond for the first time.

JPM analysts warn that alternative financing channels, such as trusts, may default if investors are unwilling to roll over products.

Increased trust defaults could reduce economic growth by 0.3-0.4 percentage points.