On March 30, CHINA RES LAND disclosed its 2025 financial results. The company reported operating revenue of RMB 281.4 billion, a slight increase of 0.9% year-on-year. Shareholder net profit remained stable at RMB 25.42 billion. Among leading real estate enterprises, CHINA RES LAND was one of the very few to achieve positive revenue growth.
The real estate sector remained in a period of deep adjustment throughout 2025, with the overall market size continuing to shrink, placing widespread performance pressure on developers. However, some developers that have successfully transformed their business models have begun a new growth cycle, with CHINA RES LAND standing out as a prime example.
While stabilizing its development business last year, CHINA RES LAND saw robust growth in its recurring income streams from operating properties and light-asset management services. The contribution from its recurring business to core net profit reached 51.8%, signaling the company's successful strategic transition from a traditional property developer to an urban investment, development, and operator.
The real estate industry has entered a new phase, characterized by evolving growth models, evaluation systems, and valuation logic. In this new environment, CHINA RES LAND is positioned to be one of the few frontrunners.
Key highlights from the financial report include resilient growth in the development business, with operating properties and light-asset management emerging as a "second growth curve."
CHINA RES LAND's 2025 operating revenue reached a record high of RMB 281.4 billion, achieving a compound annual growth rate of 7.3% over the past five years. This sustained growth against market headwinds reflects the steady performance of its development operations.
According to data from the China Index Academy, revenue for the top 100 real estate enterprises has declined for two consecutive years since 2024, partly due to reduced project deliveries. In contrast, revenue from CHINA RES LAND's development business grew from RMB 212.08 billion to RMB 238.16 billion, serving as a stabilizing anchor for overall performance.
The company's industry ranking has been consistently rising since 2021. In 2025, its contracted sales reached RMB 233.6 billion, securing the third position nationally. It ranked first in market share in five cities and was among the top three in an additional 13 cities.
This stability stems from a high-quality land bank structure. By the end of 2025, approximately 80% of the company's investments were concentrated in five core cities, including Beijing and Shanghai. This strategic land reserve, combined with strong product appeal, has enabled CHINA RES LAND to maintain rapid inventory turnover while preserving high profitability. Its gross profit margin on settled projects stood at 15.5% last year, keeping it in the industry's top tier.
Notably, while its development business remains strong, a second pillar of growth has firmly taken shape.
In 2025, revenue from operating properties reached RMB 25.44 billion, a 9.2% increase year-on-year. Core net profit from this segment grew 15.2% to RMB 9.87 billion. Revenue from light-asset management services amounted to RMB 17.83 billion.
This second growth curve—comprising rental income from shopping malls, hotels, and office buildings—is central to the strategy, with shopping malls being the core component. Rental income from shopping malls increased by 13.3% to RMB 21.9 billion. The gross and operating profit margins rose to 77% and 63.1%, respectively, with an EBITDA cost return rate of 9.8%.
Retail sales from the company's self-owned shopping malls surged 22.4% to RMB 239.2 billion, significantly outperforming the national retail average. The overall operating profit margin for these malls hit a new high of 63.1% by year-end. The average occupancy rate for office buildings improved to 77.7%, with newly leased area also reaching a record high for the period.
The third growth curve consists of light-asset management services, covering commercial management, urban space operation and services, cultural and sports venue operation, long-term apartment rental management, hotel management, urban construction and consulting, and health and wellness services.
CHINA RES MIXC LIVING is a key contributor within this segment, reporting operating revenue of RMB 18.02 billion, up 5.1% year-on-year, and core net profit of RMB 3.95 billion, a 13.7% increase. By the end of 2025, it managed 135 operational shopping malls, with 105 projects ranking in the top three for retail sales in their local markets. Full-year retail sales from these malls totaled RMB 266 billion, accounting for 0.53% of China's total retail sales of consumer goods, further cementing its leading industry position.
Additionally, the cultural/sports industry operations and rental housing business maintained rapid growth. Within asset management, the market capitalization of the CHINA RES COMMERCIAL REIT exceeded RMB 10 billion, and the CHINA RES YOCHO REIT completed a fund expansion. A newly established asset management company will manage the full value chain—from fundraising and investment to production, construction, management, and exit—representing a major future highlight.
Driven by steady development in its core business and rapid growth in the second and third curves, CHINA RES LAND's financials continued to improve. Its asset-liability ratio fell to 61.1% by the end of 2025, marking five consecutive years of reduction. The total and net interest-bearing debt ratios stood at 40.2% and 39.2%, respectively, both at low industry levels. International rating agencies S&P, Moody's, and Fitch maintained their investment-grade credit ratings of BBB+/Stable, Baa1/Stable, and BBB+/Stable. The company's comprehensive gross profit margin reached 21.2% in 2025, placing it at the forefront of the industry in terms of profitability.
The weighted average financing cost decreased further to approximately 2.72% in 2025, reflecting favorable market confidence. Cash and bank balances totaled RMB 116.99 billion, with a cash-to-short-term-debt ratio of 2.32.
Overall, against a backdrop of declining industry gross margins and widespread losses among developers, CHINA RES LAND has not only stabilized its core development operations but also achieved counter-cyclical growth, demonstrating strong resilience and an optimized financial structure.
How should the market view CHINA RES LAND?
In early 2026, the company undertook a strategic upgrade, formally elevating its operating property business to the second growth curve and its light-asset management services to the third, establishing a "three-pillar" business architecture.
This strategic shift was underpinned by the recurring business contributing RMB 11.65 billion in core net profit, accounting for 51.8% of the total. This milestone signifies the company's successful transition from a traditional developer to a multi-faceted urban investment and development operator with proven profit generation capabilities.
Industry-wide, the peak for property development has passed, and the sector is moving into an "inventory development" phase. Developers overly reliant on development activities will likely be phased out, while those that have successfully built a second growth curve are poised to reap growth benefits and undergo value reassessment.
CHINA RES LAND's successful transformation stems from early strategic positioning. As far back as 2005, it adopted a dual-driver model combining "residential development + investment properties," shifting from a pure residential developer to a comprehensive real estate enterprise. In 2007, through acquisitions, it established a unique business model integrating residential development, investment properties, and value-added services.
In 2019, it transitioned to an urban investment development operator, and since 2020, has spun off its commercial operations and property management businesses, solidifying an integrated "3+1" business model.
With the breakthrough in recurring business core profit in 2026, CHINA RES LAND has formally established a "three growth curves" model, comprising development and sales, rental income from operating properties, and light-asset management services as its three core business groups for the future.
This strategic upgrade is a milestone for the company and a benchmark for the industry's transformation. Under this three-pillar framework, the development business secures the foundation and maintains a leading position, supporting the overall transition. The rental business provides stable cash flow, acting as a performance stabilizer. The light-asset management business offers high growth and high return on equity, serving as the future growth engine. Collectively, these curves create a growth pattern of "short-term cash flow, mid-term stable income, and long-term light-asset expansion."
This structure effectively hedges against the cyclicality of the development business, shifting the company's growth logic away from high leverage and scale expansion towards stable development, asset operation, and service value-added. This new model opens up a higher growth ceiling and valuation potential for CHINA RES LAND.
The consensus is growing that the real estate sector needs a new path, and with it, new evaluation standards for developers. On March 18, 2026, the China Real Estate Network's "Top 500 Real Estate Development Enterprises Comprehensive Strength Research Report" increased the weighting for indicators like risk management, growth potential, operational performance, innovation capability, product quality, and social responsibility. In this ranking, CHINA RES LAND, Poly Development, and China Overseas Land & Investment held the top three positions for comprehensive strength.
It is noteworthy that rankings among leading developers saw significant changes, with operators demonstrating stable operations and strong product capabilities rising substantially. CHINA RES LAND, leveraging its commercial operations to build a second growth curve, saw its competitive advantages reflected in a rise to the number one position.
Furthermore, MSCI upgraded CHINA RES LAND's rating to AA, the highest among mainland Chinese real estate companies. In 2025, the company continued to be a constituent of the Hang Seng Sustainability Benchmark Index and the Hang Seng ESG 50 Index, receiving rating upgrades from MSCI, Hang Seng Indexes' sustainability assessment, and Sino-Securities Green ESG.
From a capital markets perspective, the valuation logic for real estate companies is changing. According to a Zheshang Securities research report, since 2021, market focus has shifted from forward-looking sales indicators to asset safety margins. The valuation of developers with transformation potential has begun to decouple from the traditional real estate sector. Backed by higher growth expectations, the market is assigning them higher price-to-book ratios.
The value reassessment of real estate companies has commenced, and CHINA RES LAND is poised to enter its own period of growth红利.
Comments