Losses at Chinese property giant China Vanke surged 79% in 2025 to 88.6 billion yuan (€11.1 billion), worse than the company’s own forecasts.
After a second consecutive year in the red, Vanke has accumulated total losses of 138 billion yuan (€17.3 billion) since 2024. Prior to that, it had consistently posted profits since its stock market debut in 1991.
In its earnings report submitted to the Hong Kong Stock Exchange, the developer said revenue fell 32% year-on-year to 233.4 billion yuan (€29.3 billion), due to the prolonged crisis in the sector since the start of the decade.
Specifically, Vanke’s sales measured by floor area dropped 43.4% to about 10.25 million square meters in 2025, a year in which it delivered 117,000 homes—a priority set by Beijing for developers amid the property crisis to avoid social unrest, as real estate is a key investment vehicle for Chinese households.
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Vanke’s case is significant because, following the collapse of private giants such as Evergrande Group and Country Garden due to debt crises, it was one of the few state-backed developers that had maintained favorable credit ratings—until March 2025, when major agencies downgraded it to “junk” status after multiple revisions since 2024.
This has made it a key company for assessing the authorities’ stance toward the sector. Vanke has so far avoided default only thanks to loans of about $4.2 billion (€3.63 billion) from its main shareholder, Shenzhen Metro Group.
However, that support has been in question since late 2025, as authorities are now imposing stricter conditions for continued financing. This has raised investor doubts about its ability to avoid default and fears of potential contagion to other developers that have also been holding out.
For now, Vanke has managed to avoid default after securing creditor support with an improved proposal to delay bond maturities, while preparing one of the largest restructuring plans in China’s history.
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The company said the 2025 losses were “not only due to external factors, but also internal issues, such as misjudgments in operations,” adding: “It will take time to resolve the burdens and problems resulting from the previous development model based on high levels of debt.”
“The risks have not been fully resolved, and the group’s operations and development continue to face serious challenges,” it stressed.
According to Bloomberg, the developer faces more than 11 billion yuan (€1.38 billion) in bond maturities in the coming months and had a short-term refinancing gap of around 93 billion yuan (€11.7 billion) at the end of the year.
The financial position of many Chinese developers deteriorated after Beijing imposed restrictions in August 2020 on access to bank financing for highly indebted firms, notably affecting Evergrande, which had liabilities of nearly $330 billion (€285 billion).
In response, the government has introduced various support measures, with state-owned banks also opening multibillion-dollar credit lines for several developers.
Even so, the market has yet to recover: commercial property sales by floor area fell 24.3% in 2022, 8.5% in 2023, another 12.9% in 2024, and 8.7% in 2025.
