China's private developers have been in turmoil since mid-2021 after Beijing's crackdown on debt impacted first Evergrande Group and then spread across the sector.

Property companies were among the biggest high-yield issuers in Asia and many aim to use shares of their listed entities to restructure offshore debt after having defaulted on their repayment obligations.

The Shanghai stock exchange delisted Sichuan Languang Development on Tuesday, the first such case for property A shares, and Sinic Holdings was delisted from Hong Kong in April.

In mainland China, S&P said the 11 firms at risk of being delisted, including Shanghai Shimao and Yango Group, have offshore and onshore bonds outstanding collectively worth $21 billion.

These firms either closed below or just above 1 yuan on Monday or before they went into trading halt. Shanghai Shimao and Yango did not immediately respond to request for comment.

The agency said its empirical study shows investors typically get about 2-4 cents on the dollar in liquidation, and liquidation terminates jobs, meaning homes that buyers have bought may not be completed.

"(Delisting) closes options for Chinese developers to recover, and for investors to get their money back," said S&P credit analyst Esther Liu, adding it discourages parties from seeking an out-of-court restructuring.

The Shanghai and Shenzhen exchanges delist companies whose shares trade below 1 yuan for 20 consecutive days, while the Hong Kong exchange can delist companies if their shares halt trading for 18 months.

China Evergrande Group, the world's most indebted developer, and Shimao Group, both listed in Hong Kong, have been suspended from trading for 14 months.

Evergrande gave creditors a basket of options in its offshore debt restructuring terms to swap part of their debt into equity-linked instruments backed by the company and its two Hong Kong listed-units - all of which have halted trading since March 2022.

(Reporting by Clare Jim; Editing by Barbara Lewis)