Last week, we looked into how China Vanke, once regarded as one of the nation’s most stable and reputable real estate developers, came to face diminishing operating cash flows, thin gross margins, and limited options on refinancing channels.

For part one of our analysis, click here.

The CNY 2bn ($283m) onshore bond due 15 December 2025, for which Vanke sought an extension, is small compared to the company's total debt of more than CNY 350bn. But the request to extend appears to have signalled to markets that the once-seemingly “safe and protected” developer may be facing the same issues its private peers have faced.

Despite receiving support until recently from its largest shareholder Shenzhen Metro, Vanke is struggling to keep its head above water. And the market is now speculating whether China’s government will continue backing the developer or allow it to join some of its peers in defaulting and facing a restructuring path.

This report investigates potential solutions that may allow Vanke to resolve — or at least stabilise — its current situation.

Asset disposals

In recent years, Vanke has prioritized capital recovery through asset sales to ease liquidity pressure. The company completed bulk transactions for 54 projects across 19 cities in 2024, including office buildings, commercial centers, and hotels, with a total contract value of CNY 25.9bn.

But in H1 25 Vanke completed bulk transactions for only 13 projects, worth a total of just CNY 6.4bn, as it had sold its higher-valued assets first. Vanke also faced buyers who squeezed prices down. As management stated, to accelerate its capital recovery, “the transaction prices of some bulk asset and equity transactions were lower than book values.”

The company did shift its asset disposal strategy in 2025 to focus on selling non-core operational businesses. It sold its ownership of Jilin Songhua Lake International Resort Development and Beijing Wanbingxue Sports to China Travel International, a subsidiary of state-owned China Touism Group, for CNY 300m. Another asset Vanke was also reportedly in advanced talks to sell was VX Logistics, to Singapore's GIC. Vanke's 81.6% stake in the company was valued at around CNY 27bn in 2022.

Looking ahead, Vanke still has assets that could be monetized. One example is Onewo, its property management subsidiary focused on Guangzhou and Shenzhen, which generated CNY 18.1bn in revenue in H1 25. However, the company has pledged its entire controlling stake to Shenzhen Metro, complicating any potential sale. Onewo's stock price has also dropped significantly since it was listed in 2023. Should Vanke sell at the unit’s current valuation, it would see limited returns.