China Resources Shenzhen Grain Depot stalls

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Author | Zhou Zhiyu

Editor | Huang Yu

End of November, Shenzhen Bay. The luxury residence Shenzhen Bay Yunxi, jointly developed by China Resources Land and China Overseas, opened for the first time, raking in 13 billion yuan in a single day. Billion-yuan sky-high flats were snapped up by wealthy buyers as if buying cabbages. The surging wave of money at the sales center seemed to announce the return of Shenzhen’s undefeated "number one brother".

However, the frenzy of luxury homes cannot hide China Resources Land’s overall decline in Shenzhen. In what was once its granary, China Resources Land continues to lose momentum.

According to data from China Index Academy, in the first 11 months, China Resources Land ranked seventh among Shenzhen real estate companies with sales of 8.032 billion yuan, lagging far behind the first place Hongrongyuan (18.255 billion) and the second place China Merchants Shekou (14.396 billion yuan).

Shenzhen Bay Yunxi, co-developed by China Resources Land and China Overseas, will contribute over 7 billion yuan in sales to China Resources Land based on a near 80% online signing rate so far, but this is not enough to reclaim the throne.

From being the uncontested "number one brother" in Shenzhen for three consecutive years (2021-2023), to falling to fourth place in 2024, and now hovering between seventh and ninth for the past 11 months, unable to break into the top five—China Resources Land has fallen from grace in just over a year.

Once, Shenzhen was China Resources Land’s most important "granary," contributing nearly 20% of the group’s performance; now, this proportion has shrunk to less than 5% in the first 11 months of this year.

The poor performance of China Resources Land in Shenzhen is mainly due to its own engine stalling.

Over the past decade, China Resources’ strategy in Shenzhen was to focus on “super projects” in core areas (such as China Resources City), while also holding onto peripheral areas.

For years, the most desired property for many Shenzhen middle-class and speculators was China Resources City. Since its launch in 2014, prices rose from an initial 47,000 yuan/sqm to 131,000 yuan/sqm. Every opening saw a frenzy of buyers—jokes like “millionaires squatting in corners” became popular.

This also drove hot sales of China Resources’ “Runfu” series outside core areas. But since 2023, market differentiation has caused its products in peripheral areas to fall out of favor, affecting half its sales in Shenzhen.

Now, China Resources Land in Shenzhen is even more dependent on very few “super projects.” For instance, though Shenzhen Bay Yunxi is selling well, it lacks sustainability like China Resources City. The project is not only a cooperation with China Overseas (only 50% share), but will face greater pressure to sell remaining units—the billion-yuan flats are almost sold out, with only the fiercely competitive 30–50 million yuan "entry-level products" left.

A senior manager of a leading property company in South China estimates that Yunxi’s plot ratio is 7.59, far exceeding traditional luxury homes. The group buying Yunxi is different from those who scrambled to buy Runxi; these buyers will carefully consider spending over 30 million yuan for a purely residential unit with no sea view and unclear value prospects.

With projects like CITIC Xinyue Bay, LianTai Chaozong Bay, and China Merchants Houhai Xi entering the market, Shenzhen’s luxury housing sector is set for fierce competition.

After Shenzhen Bay Yunxi, the supply of “super projects” by China Resources Land in Shenzhen appears weak. This year, Shenzhen released 12 plots, but China Resources only jointly acquired one with China Merchants Shekou (50% share). The floor price of this plot reached 59,586 yuan/sqm, with a premium rate of 34.81%, making it this year’s most expensive plot in Shenzhen, likely to be developed as high-end residential. Other than this, China Resources gained nothing in the open market.

The decrease in public land purchases means China Resources Land has not effectively unlocked its vast reserves of urban renewal projects in Shenzhen.

After the Nanshan Dacong Village urban renewal, the Lakebei urban renewal project, with an expected investment of over 70 billion yuan, is a key asset for China Resources Land.

This giant project, which began in 2011, once carried China Resources’ ambition to create a “world-class urban complex,” even planning a 500-meter-high landmark “Lakebei Tower.”

At the end of November this year, the planning for Lakebei’s core A9 plot was adjusted, changing from pure commercial use to “mixed commercial and residential,” and the plot ratio was reduced from 13.1 to 8.7. This means that part of the commercial dream has been abandoned, seeking instead quick returns via residential sales. After all, the original plan called for project completion in 2027, but only one plot (A4) has been delivered so far.

The Lakebei urban renewal project also represents the old business model of China Resources Land. Its pride in being a “city investment and development operator” meant operating assets formed a secondary growth curve, but also a massive capital sink.

Data shows that by the end of 2022, China Resources Land’s asset management scale was still 358.6 billion yuan; by mid-2025, this figure has reached 483.5 billion yuan. In order to "slim down," China Resources Land is the most active in asset securitization among leading property companies, but this path has not gone smoothly. Since March, China Resources Commercial REIT has frequently announced plans to expand by adding new projects—none have been completed so far.

Under enormous capital pressure, China Resources can no longer afford to wait.

At the end of October this year, Xu Rong succeeded Li Xin as chairman of China Resources Land Holdings (core bond issuing platform). Back in 2023, this government-backed executive already served as chairman of the Lakebei urban renewal project company.

The group president personally overseeing the urban renewal project and directly controlling finances makes Xu Rong’s wide remit notable.

Data reveals China Resources Land’s extreme hunger for capital. In November, it broke a six-year silence by issuing $3.9 billion in bonds; three days later, it discounted shares in China Resources Mixc Lifestyle, netting 2 billion Hong Kong dollars. As of November, its public financing for the year exceeded 60 billion yuan, a ten-year high.

Behind this is the surging debt pressure on China Resources Land. By mid-2025, total loans have climbed to 281.27 billion yuan, with net interest-bearing debt ratio jumping by 7.3 percentage points in six months. In one year, 61.6 billion yuan of debt will mature, while cash reserves have shrunk by 9.8% year-on-year to 120.24 billion yuan.

China Resources Land also needs to shuffle funds and revitalize urban renewal projects to survive this winter.

The hundred-billion hot sales of Shenzhen Bay Yunxi are a high-concentration booster shot for China Resources Land. After the medicine wears off, it still has to face brutal reality.

The era of a dominant “city-wide leader” is gone for good. How to balance core asset profit release and massive urban renewal capital sink will be a long-term challenge this state-owned enterprise must face in Shenzhen.

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