Greentown China Announces 2025 Performance: Three Advantages and Two Concerns

Ask AI · What challenges does a high-turnover business model face during a real estate downturn?

On March 31, Greentown China released its 2025 annual performance. The announcement shows that in 2025, Greentown China achieved operating revenue of RMB 154.97B, down slightly by 2.26% year over year; net profit was RMB 2.2866 billion, down 44.9% year over year; and profit attributable to shareholders was only RMB 70.99M, down 95.55% year over year, the lowest value since the company’s listing.

In the announcement, Greentown stated that the profit decline was mainly due to factors including a longer period of adjustment in the real estate market, strategies for clearing long-inventory through disposal, asset impairment provisions, and the decline in performance of joint ventures and associates. In 2025, Greentown recorded a net amount of RMB 4.92B in provisions for relevant asset impairments and losses from fair value changes (2024: RMB 4.92B).

While profit pressure persisted, Greentown China maintained stable scale on the sales front, and its liability position continued to improve. The proportion of short-term debt fell to 18.6%, a new all-time low, and the cash-to-short-debt ratio reached 2.6x.

Greentown China’s 2025 performance: core data

After the results were released, Greentown China’s share price fell to below RMB 9 per share, down more than 4%, mainly due to the sharp decline in profit.

01 Three advantages

In 2025, the real estate industry continued to be in a deep adjustment cycle, with multiple pressures layered on top—weak market demand, high inventory levels, and compressed profit margins. However, Greentown China maintained sustained advantages in three areas.

Sales scale remains among the top, and collections stay stable

In 2025, against the backdrop of an overall decline in real estate sales, Greentown China kept a leading position in sales scale within the industry, making it one of its core competitive strengths. According to the annual report, the company achieved full-year cumulative total contracted sales of about RMB 251.9 billion, ranking second in the industry. This was a slight increase of 2.8% from RMB 245.0 billion in 2024, reflecting a modest increase against the trend and highlighting strong market competitiveness.

From the perspective of sales mix, coordination between self-invested projects and projects under agency/construction management efforts became the “two wheels” through which Greentown consolidated its scale advantage. Among them, sales revenue from self-invested projects was RMB 153.4 billion, and equity sales revenue was RMB 104.3 billion—both ranking fifth in the industry. Relying on its brand reputation accumulated over the long term, it maintained a stable inventory-clearing level. Sales revenue from agency-managed projects reached RMB 98.5 billion, accounting for nearly 40% of total sales, up 15.3% year over year. These have become an important supplementary force for revenue growth, effectively alleviating the pressure caused by a decline in revenue from development business.

While growing in scale, Greentown also ensured the stability of collections, providing strong support for the company’s cash-flow security. In 2025, the company’s sales collection rate reached 101%, maintaining a benchmark level in the industry, up slightly from 99% in 2024. The stability of the collection rate mainly benefited from two factors: first, the company’s regional layout is concentrated in first- and second-tier high-level cities and core areas in the Yangtze River Delta, where housing demand tends to be relatively stable and collection capability is stronger; second, the company strengthened collection management, optimized payment processes, and accelerated cash回笼.

Debt structure is safer, and financing costs are lower

Over the past few years, Greentown lowered its requirements on profit and devoted more effort to inventory clearing and debt safety. The annual report shows that as of the end of 2025, Greentown’s total borrowing balance was about RMB 128.7 billion, down slightly from RMB 135.0 billion at the end of 2024 (a decrease of 4.7%), with debt scale showing a steady contraction trend.

Continuous optimization of the debt structure effectively reduced short-term repayment pressure. As of the end of 2025, the proportion of short-term debt fell to 18.6%, a new all-time low; the proportion of long-term debt increased to 81.4%, further rationalizing the structure between long and short debt and effectively avoiding the risk of tight short-term funding chains.

In terms of financing channels, the company has built a diversified financing system, relying mainly on bank loans, medium-term notes, corporate bonds, and other financing methods. Financing sources are stable: bank loans account for 65% of the total borrowing balance; medium-term notes and corporate bonds account for 28%; and other financing methods account for 7%. Diversified financing channels reduce reliance on any single financing method and enhance financing stability.

At the same time, backed by its major shareholder China Communications Investment Corporation, Greentown’s financing cost has continued to decline. In 2025, the company’s total borrowing weighted average financing cost fell to 3.3%, down significantly by 60 basis points from 3.9% in 2024, remaining at a relatively low level in the industry.

High-efficiency sales collections, combined with the decline in the short-term debt ratio and the continued drop in financing costs, have increased the safety margin of Greentown’s cash flows.

Inventory drops significantly, and new land reserves concentrate in first- and second-tier cities

In recent years, Greentown China’s total land reserve volume has continued to shrink—from 37.20 million square meters in 2023 to 23.71 million square meters in 2025. Over the two-year period, it decreased by 36.3%. This was mainly because the company proactively disposed of inefficient inventory and scaled back its investment size, aligning with the industry’s development trend of “deleveraging inventory and stabilizing cash flows.”

Meanwhile, Greentown has continuously increased its allocation in the Yangtze River Delta region. Last year, the company added 50 new projects, with a total GFA of 3.18 million square meters. It expects new attributable value of RMB 135.5 billion, of which the Yangtze River Delta region accounts for 81%, and Hangzhou alone accounts for as much as 38%. The company is heavily weighting the Yangtze River Delta because since the real estate downturn, the Yangtze River Delta has been one of the most stable regions for inventory clearing, providing stable support to scale and cash flows.

As of the end of last year, the number of Greentown’s land-reserve projects remained 146 (including projects under construction and pending construction), with total saleable area of about 15.67 million square meters and attributable saleable area of about 9.72 million square meters. The share of high-level cities fell slightly to 76% in 2024, then rose again to about 80% by the end of 2025.

02 Two pressure points

Against the backdrop of a deep adjustment across the industry, Greentown China’s operations also face multiple challenges, especially in two areas: profit performance and inventory disposal.

Profits decline sharply; multiple profitability indicators hit historical lows

A sharp decline in profits is Greentown China’s most prominent operating pressure point in 2025. All key profitability indicators showed significant declines, and some indicators reached the lowest levels since the company’s listing, reflecting the severe impact of industry adjustment on the company’s earnings. The annual report shows that Greentown achieved full-year net profit of RMB 2.29B in 2025, down 44.9% year over year; after deducting non-recurring gains and losses, net profit was RMB 2.01B, down 47.2% year over year; and profit attributable to shareholders was only about RMB 71M. This plunged 95.55% from RMB 1.6B in 2024, reaching the lowest level since the company’s listing, with the company’s profitability nearly at zero.

According to the clearly disclosed information in Greentown’s annual report, the core reasons for the sharp profit decline mainly include three aspects: first, due to market adjustment, the gross margin from recognizing revenue on completed projects decreased. To accelerate the clearing of long-cycle inventory, the company adopted price-cut and promotional strategies in some cities, which continuously squeezed the profit space of recognized projects. The full-year gross margin was about 11.9%, down further from 12.8% in 2024; the continued downward trend of gross margin directly led to a decline in profitability. Second, the pressure from asset impairment provisions remained high. In 2025, the net amount of provisions for asset impairments and losses from fair value changes totaled RMB 4.92B. This massive impairment directly consumed a large portion of profits. It mainly involved asset impairments of certain inventory projects with difficult clearance and assets of joint venture and associate projects, reflecting the pressure on the company’s inventory disposal. Third, the performance of joint ventures and associate companies declined. Affected by the overall industry environment, the company’s share of investment gains from joint ventures and associates decreased compared with the prior year, further dragging down net profit performance and also reflecting the broader impact of industry adjustment.

Greentown China’s 2025 financial data

Inefficient inventory may still drag down profits

Being dragged down by old inventory and recording large impairment provisions has been a common cause of the sharp profit drop among real estate developers in recent years. Since 2022, within four years, Greentown has recorded a cumulative net amount of asset impairment provisions and losses from fair value changes of RMB 13.38B. Among them, 2024 and 2025 were peak provision years, at RMB 4.92B and RMB 4.92B respectively.

Of the impairment provisions and fair value change losses recorded in 2025, the net impairment loss under the expected credit loss model was approximately RMB 2.04B, and the net impairment loss for non-financial assets was approximately RMB 2.9B. Most of the latter was due to losses resulting from disposing of projects acquired in 2021.

From 2021 to today, during the real estate downturn, although Greentown reduced the amount of land acquisition, based on investment intensity, Greentown continued to be in a peak period for land acquisition. Its equity land acquisition amounts from 2021 to 2025 were: RMB 96.9 billion (ranked 6th), RMB 45.1 billion (ranked 6th), RMB 63.3 billion (ranked 5th), RMB 52.9 billion (ranked 4th), and RMB 59.2 billion (ranked 4th).

During the period, Greentown’s equity sales fluctuated around RMB 120 billion. Among them, in 2025 it was about RMB 104.3 billion, and the land acquisition-to-sales ratio was about 56.7%, remaining high.

This means that after Greentown collects cash from sales, it quickly puts the funds into new land investments. In essence, this is still a high-turnover model. During a real estate downturn, requirements for investment precision are very high, which is why Greentown has increasingly compressed more attributable value into the Yangtze River Delta region—because overall inventory clearing there is better and turnover is faster.

Greentown’s board chairman, Liu Chengyun, also stated clearly at the performance briefing that the company’s 2026 investment work will be the most difficult year among the recent years.

However, Greentown still set high expectations for this year’s investment intensity. It expects the full-year land acquisition scale to be preliminarily set around RMB 100 billion (full-coverage basis). In the current market environment, continuing high-intensity land acquisition will inevitably generate some low-profit projects and may even lead to inventories triggering asset impairment. These projects with difficult clearance consume capital and affect asset turnover efficiency.

Overall, it is expected that in 2026 Greentown’s net profit will still remain at a low level. But as “hard-core” inventories prior to 2023 are gradually settled and impairment provisions recorded, future profits will gradually recover.