China Resources Land predicts that the most difficult period in the real estate industry has passed.

Question AI · How do the three growth curves work together to drive steady profit growth?

21st Century Business Herald reporter Wu Shuying

China Resources Land has once again solidified its position as the “profit king” in the real estate industry.

According to China Resources Land’s financial report, as of the end of 2025, China Resources Land achieved operating revenue of RMB 281.44 billion, up 0.9%; gross profit was RMB 59.744 billion, down by about 1% year over year; net profit attributable to shareholders was RMB 25.42 billion, down by about 0.5% year over year. Of this, core net profit from recurring business increased 13.1% year over year to RMB 11.65 billion, with the share of core net profit rising to 51.8%.

China Resources Land’s profit performance is far higher than peers such as China Overseas Land & Investment, Poly Developments and Holdings, and China Merchants Shekou, and it once again takes the “profit king” position in the real estate industry.

China Resources Land said that this indicates the company has taken the lead in completing a strategic leap driven by multiple, related tracks of “development, operations, and services.” It uses business certainty to begin a new chapter of value reappraisal and high-quality development.

China Resources Land’s financial report can be seen as a forward-looking example for property developers in the post-development phase. When development business scale is no longer the priority, the direction of transformation for real estate companies determines the upside potential for revenue and profit growth, as well as the sustainability of development.

At a performance briefing, China Resources Land’s Chairman of the Board, Li Xin, analyzed that during the “15th Five-Year Plan” period, the company planned a new business model of “high-efficiency coordination and aligned efforts across three growth curves, achieving comprehensive high-quality development.” It is expected that by the end of the “15th Five-Year Plan,” the revenue scale of development and sales-oriented businesses will be maintained at around RMB 200 billion to RMB 250 billion, keeping its leading position in the industry; revenue from operating real estate leasing businesses will be stabilized at above RMB 30 billion, with quality and scale remaining number one in the industry; and the fee-based light-asset management business will maintain a strong growth momentum, with expected annual growth exceeding 10% and revenue scale above RMB 20 billion.

Scale is no longer supreme

In China Resources Land’s plan, in the near and mid term the development business will maintain its existing scale and shift to profit first.

Li Xin pointed out that during the “14th Five-Year Plan” period, China Resources Land successfully made the leap from the first growth curve to the second growth curve. During the “15th Five-Year Plan” period, China Resources Land strategically planned the new business model of “high-efficiency coordination and aligned efforts across three growth curves, achieving comprehensive high-quality development.” This represents a major strategic upgrade of China Resources Land’s business model: it marks that the company has fully shaken off the old development model of the past “three high” approaches, and has built a new high-quality development business ecosystem across the entire industry chain, based on the efficient and complementary coordination of the three growth curves.

Keeping development business revenue within RMB 250 billion means that China Resources Land will not expand the scale of its development business in the future.

Li Xin said that China Resources Land will base itself on the single-project era, with improving quality and efficiency and protecting profits as the core direction, to drive steady, innovative, high-quality development of development and sales businesses and consolidate its leading position in the industry. In terms of layout, it will continue to deepen efforts in first-tier and key second-tier cities, while also mining value “pockets” cities that are supported by industries, ensuring that each project achieves one-project-one-policy and refined operations in the fierce market competition.

In 2025, China Resources Land achieved contract value of RMB 33.6 billion, with its sales scale staying in the top three in the industry, achieving settlement gross margin of 15.5%, and keeping its profitability at the first echelon in the industry.

Meanwhile, China Resources Land’s investment strategy is further focused, and it basically invests in first-tier cities. China Resources Land said the company adheres to the principles of strategy-led investment and “spend according to what you have,” and in 2025 acquired 33 projects and equity investment of RMB 67.37 billion; the investment share in five major core cities such as Beijing and Shanghai is close to 80%, and its land reserve structure continues to be optimized.

Regarding the market outlook for 2026, China Resources Land’s Chief Operating Officer, Chen Wei, said that based on this year’s March market data, the national market shows features of structural repair: new home transaction volume grew month over month, while year over year declined; second-hand home transaction volume showed a relatively large month-over-month increase; and some cities reached the highest levels in recent years. The reason for this phenomenon is that the overall macroeconomy remains steady. In different regions, policies are fine-tuned “city by city” to optimize regulation, and some cities’ home purchase voucher and subsidy policies lower the cost of buying homes. In addition, Document No. 38 from the Ministry of Natural Resources provides the market with a favorable expectation, and the price repair of older housing stock in some core cities drives a rebound in transaction volume.

Chen Wei continued that certain cities—for example, the new home market in Shanghai—also show fairly obvious expansion signals, while the current policy effort is somewhat restrained, and there is still considerable room for future policy efforts. “Based on the above judgment, the industry’s most difficult period has basically passed, and it has officially entered a cycle stage of bottoming out and rebound, with deep divergence. Core cities and high-quality segments will take the lead. On the basis that other cities gradually digest existing inventory, slow repair will be realized.”

With investments kept prudent, China Resources Land’s cash flow is also relatively stable. At the end of 2025, China Resources Land held cash reserves of RMB 116.99 billion; at the same time, in 2025 China Resources Land’s total interest-bearing liability ratio and net interest-bearing liability ratio remained in the best tier in the industry. As of December 31, 2025, its weighted average financing cost reached a new historical low, down 39 basis points from the end of 2024 to about 2.72%.

A new growth engine

Since development is no longer about scale being supreme, China Resources Land will tilt more resources toward operating real estate leasing business in the future—this is the company’s second growth curve.

Li Xin’s positioning of this business is as an engine for sustainable performance growth and also the primary contributor to profit and stable cash flow. In 2025, China Resources Land’s operating real estate generated operating revenue of RMB 25.44 billion, up 9.2%, and net profit of RMB 9.87 billion, up 15.2%.

As can be seen, the key for China Resources Land to maintain stable profits is that operating real estate leasing business revenue and profit remain relatively stable. Looking across mature markets, most real estate companies shift to “leasing” as the main focus after growth in development businesses slows down. Benefiting from its advantage of being an early planner, China Resources Land was able to pass through the transformation period in a stable manner.

Li Xin said that during the “15th Five-Year Plan” period, China Resources Land will fully leverage its first-mover advantages, with “both quantity and quality being optimal” and enhancing profits as the core orientation, to comprehensively deepen the high-quality development of its operating real estate leasing business. It will strengthen the resource tilt toward advantageous assets such as core business districts and high-quality carriers, while also building multi-level asset operation platforms and actively executing operations to enable assets to enter and exit in an orderly manner, thereby promoting efficient circulation between assets and capital.

Fee-based light-asset management business is China Resources Land’s third growth curve, positioned as the core creator of strong performance growth and value in terms of space.

Li Xin said that during the “15th Five-Year Plan” period, China Resources Land will accelerate expansion of external resources, with innovation and value enhancement as the core orientation, and work hard to cultivate high-quality light-asset management businesses. It will seize the industry’s scale-expansion window and accelerate grabbing the market’s first-mover advantage in tracks where it has competitive strengths, such as commercial management, urban space management, asset management, and culture-and-sports operations. Li Xin expects that during the “15th Five-Year Plan” period, China Resources Land’s fee-based light-asset management business will achieve rapid growth.

At the performance briefing, China Resources Land’s management said that looking ahead to the “15th Five-Year Plan,” China Resources Land will comprehensively upgrade its strategic positioning, anchored on the goal of “creating a world-class city investment, development, and operations provider.” Through the efficient coordination and aligned efforts across the “three growth curves,” it will reshape new competitive advantages in the industry.