China Jinmao's 2025 performance defies the trend with growth; management states that high-quality real estate companies face "more opportunities than challenges."

How does China Jinmao leverage product strength to achieve counter-cyclical growth in the industry’s downturn?

CJR reporters Wu Jing and Lu Zhikun report from Beijing

In the deep adjustment of the real estate industry in 2025, China Jinmao (00817.HK) delivered a report of counter-cyclical growth.

On March 24, the company released its performance report, showing that the contracted sales amount reached 113.5 billion yuan in 2025, a year-on-year increase of 16%, and its industry ranking rose to 8th place, setting a historical high. Against the backdrop of declining sales figures for most leading real estate companies, this performance has attracted market attention.

At the performance release conference held on the same day, China Jinmao Chairman Tao Tianhai made a judgment on the industry’s prospects. He believes that the current market adjustment is at the bottom, and in 2026, the industry will still be in a bottoming and recovering process, characterized by “industry bottoming, structural differentiation, and corporate breakthroughs.” He also pointed out that as the market gradually stabilizes, the pent-up demand in core first- and second-tier cities is expected to be released, while in third- and fourth-tier cities, projects meeting the conditions of “good location, good product” still have opportunities.

Product Strength Drives Sales Structure Optimization

The financial report shows that China Jinmao’s growth in 2025 did not rely on price cuts for sales volume. Against the backdrop of a 16% year-on-year decline in contracted sales amount among the top 10 real estate companies, the company’s average sales price continued to rise last year. The contracted unit price for residential properties increased by 24% from about 21,800 yuan/square meter in the same period last year to 27,000 yuan/square meter.

This performance is directly related to the iteration of the company’s product system. Reporters learned that the “Jin Yu Man Tang” product system launched by the company in 2024 continued to be implemented during the reporting period, with 6 Jinmao Fu, 7 Pu (Yu) series, 5 Man series, and 8 Tang series projects launched, achieving hot sales in multiple cities. In terms of regional distribution, the proportion of contracted sales in first- and second-tier cities reached 96%, with the two major regions of North China and East China increasing their contracted sales proportion to 73%. The contracted sales amounts in the two first-tier cities of Beijing and Shanghai exceeded 20 billion yuan each, and the sales amount in the Xi’an market surpassed 10 billion yuan.

At the performance conference, Tao Tianhai described the current competitive landscape of the industry as “shifting from perfect competition to oligopoly.” He believes that after the industry reshuffle, mainly leading companies remain, and competition will focus more on product strength and operational efficiency. For the quality real estate companies that survive, “the future presents more opportunities than challenges.”

While the sales scale has grown, China Jinmao’s profitability in 2025 shows signs of recovery. The gross profit for the year was 9.221 billion yuan, a year-on-year increase of 7%, with the overall gross profit margin rising to 16%; the profit attributable to the company’s owners was 1.253 billion yuan, up 18% year on year.

The improvement in profits is behind the adjustments in project acquisition and operational strategies. The management disclosed at the performance conference that since 2024, the company has cumulatively acquired 43 projects, all focused on core cities and core sectors, with an average net profit margin exceeding 10%. At the same time, revitalizing existing stock has become another main line, with 47 projects completed for liquidation in 2025, and a cumulative 15 land plots and 26 bulk assets revitalized.

The improvement in operational efficiency is reflected in project cycles. Last year, the average initial opening cycle for new projects was shortened to 5.2 months, reinforcing the “quick open, quick return, quick clearance” operational strategy, with operating cash flow returning to positive within 10.4 months. In terms of cost control, sales expenses, management expenses, and financial expenses decreased by 4%, 13%, and 9%, respectively, with the reduction of the three expenses creating space for profits.

In terms of financial structure, during the reporting period, the average cost of new financing for China Jinmao dropped to 2.75%, maintaining a relatively low level in the industry. The debt structure continued to optimize, with the proportion of development loans and operating loans increasing to about 50%, and the proportion of foreign currency debt declining year on year to 20%. As of the end of the reporting period, the company had over 70 billion yuan in unused bank credit, providing a financial reserve for subsequent investments.

Investment Focus and Second Growth Curve

On the investment side, China Jinmao continued its strategy of “converging and focusing.” All 21 newly acquired projects in 2025 are located in first- and second-tier cities, with investments in the strategically deepened cities of Beijing and Shanghai accounting for as much as 66%. By the end of the reporting period, 89% of the unsold value of the company was located in first- and second-tier cities, with the proportion of unsold value in first-tier cities increasing by 8 percentage points from the previous year to nearly 30%, continuing to concentrate the value structure in high-tier cities.

The management stated at the performance conference that in 2026, the company will implement the concept of “product leadership, customer first,” creating more value for customers through product strength. In terms of investment strategy, it will continue the “active but not aggressive” style, focusing on high-tier cities, “investing well and investing properly.”

Beyond the main development business, China Jinmao’s second growth curve made progress in 2025. Jinmao Services (00816.HK) saw its managed area increase by 5% year on year, with operating revenue growing by 18.5%, and core property management revenue rising by 23% year on year. In terms of held properties, commercial operating revenue increased by 9% year on year, and hotel EBITDA grew by 31%. Projects such as Hangzhou Qinwang Water Street and North Bund Jinmao Center opened last year, and the light asset business continues to expand.

As an attempt at asset securitization, the first batch of publicly offered REITs for consumer infrastructure in China—Huaxia Jinmao Commercial REIT—has completed 7 dividend distributions, with a distribution rate stable at over 5%.

Regarding future strategies, the management stated at the performance conference that China Jinmao achieved the phased task of “survival” during the industry adjustment period, and the next stage will aim at “thriving,” further revitalizing existing stock and optimizing incremental growth, striving to “live brilliantly.”

(Edited by Lu Zhikun, Reviewed by Tong Haihua, Proofread by Yan Jingning)