China Resources Land spent 32.5 billion yuan on land acquisition and replenished its cash flow through financing supported by Chengdu MixC.

With double-digit revenue decline, China Resources Land is ramping up its investment efforts.

On August 31, China Resources Land (01109.HK) released its 2026 interim results. In the first half of the year, the company recorded a turnover of 67.87 billion yuan, a year-on-year decrease of 28.5%.

In response to the decline in revenue scale, Zhao Wei, Chief Financial Officer of China Resources Land, explained that this is mainly related to the continuous adjustment of the real estate industry in recent years. "In 2024, the company actively reduced its land acquisition scale to control operational risks, which led to a decrease in the scale of deliverable projects in the first half of 2026." In 2024, China Resources Land's newly added land reserve area was 3.93 million square meters, a year-on-year decrease of 70.3%.

In the first half of this year, China Resources Land significantly accelerated its investment pace, acquiring a total of 16 projects with equity investment of 32.49 billion yuan, second only to Poly Development.

At the same time, China Resources Land is also accelerating the layout of REITs. With the inter-institutional REIT of Chengdu MixC launched, the company is trying to open up the capital cycle of "investment - development - operation - exit - reinvestment".

Spending over 30 billion yuan on land acquisition in H1, increasing M&A efforts

The revenue decline of China Resources Land mainly came from its development business. During the period, the company's settled turnover from developed properties reached 45.26 billion yuan, a year-on-year decrease of 39.1%, with a settled area of 1.978 million square meters, a year-on-year decrease of 38.3%.

Against this background, China Resources Land has significantly increased its investment intensity.

In the first half of the year, China Resources Land acquired a total of 16 projects with a total land price of 34.1 billion yuan, equity investment of 32.49 billion yuan, and newly added planned floor area of 2.84 million square meters. Among them, 14 projects were acquired for development and sales business, with an equity land price of 29.77 billion yuan.

Li Xin, Chairman of the Board of China Resources Land, said that in the first half of the year, the company's investment in first- and second-tier cities accounted for 99%, and its investment intensity ranked second in the industry.

Entering the second half of the year, China Resources Land's momentum of land acquisition has not weakened.

On July 28, China Resources Land, in conjunction with Poly Development, won the Badaitou comprehensive land plot in Yangpu District, Shanghai for 16.12 billion yuan, refreshing the record of land price in Shanghai within the year; on August 28, China Resources Land acquired the Pazhou plot in Haizhu District, Guangzhou for 8.056 billion yuan, with a premium rate of 33.02%, ranking top 3 in the transaction floor price per square meter in Guangzhou.

It is worth mentioning that among the 16 projects acquired by China Resources Land in the first half of the year, 13 came from the non-public land market, making land acquisition channels more diversified.

For example, through coordinated regional development, the company acquired projects such as Shenzhen Universiade, Dongguan Jiaoyiwan, and Beijing Lize; through mergers and acquisitions, it acquired Hefei Suning Plaza; at the same time, it also obtained TOD commercial complex projects such as Chengdu Wanjiawan and Zhengzhou North Longhu.

On June 13, Shanghai Hongzhe Real Estate Development Co., Ltd., a wholly-owned subsidiary of China Resources Land, acquired Hefei Suning Plaza through judicial auction for 657 million yuan, which was about 35.6% lower than the assessed price of 1.021 billion yuan. This is also a project acquisition method that China Resources Land rarely tried in the past.

Zhang Dawei, Vice Chairman of the Board of China Resources Land, said that Hefei Suning Plaza is in line with China Resources Land's second growth curve development strategy and investment standards, and is expected to become a regional commercial center in the northern part of Hefei after opening.

Zhang Dawei further revealed that during the "15th Five-Year Plan" period, the company will adopt a positive strategy for stock mergers and acquisitions, with the goal of acquiring 1-2 high-quality stock M&A projects every year.

Chengdu MixC off-balance-sheet, opening up REITs financing channels

Behind the continuous large-scale acquisition, China Resources Land obviously needs more capital.

As of the end of June, China Resources Land's cash reserve was about 98.91 billion yuan, a decrease of about 16.54 billion yuan compared with the end of 2025; its total comprehensive borrowing was 271.18 billion yuan, and its net interest-bearing debt ratio was 41.0%.

In addition to financing in the public market, China Resources Land, which holds a large number of commercial real estate assets, is also expanding its financing channels and trying to revitalize mature commercial assets through REITs.

In the first half of this year, Chengdu MixC completed a capital operation of "asset off-balance-sheet + REITs listing".

According to public information from the Shanghai United Assets and Equity Exchange on June 25, 100% equity of Chengdu MixC Project's parent company - China Resources Land (Chengdu) Development Co., Ltd. was transacted at about 8.475 billion yuan, with a premium of 12.85% over the listing reserve price of 7.51 billion yuan. It is reported that this is a necessary asset restructuring link before the issuance of REITs, which essentially packages and transfers the "property right" to a professional management institution and separates it from the "operation right".

After completing the equity transfer of the project company, China Resources Land then issued an inter-institutional REIT with Chengdu MixC and the MUMIAN Hotel as the underlying assets, which was listed on the Shanghai Stock Exchange on July 8, with an asset consideration of about 10.5 billion yuan, making it the largest-scale strong equity flat-structure real estate project in the market.

The first phase of Chengdu MixC opened in 2012, and the second phase opened in 2020. It has now entered a relatively mature and stable development stage. Zhao Wei introduced that Chengdu MixC's NOI (Net Operating Income) reached 620 million yuan in 2025, is expected to increase by 5% year-on-year in 2026, and the compound annual growth rate in the next three years will be about 4.5% to 5%.

However, according to the transaction structure arrangement, China Resources Land still holds 39% of the shares of the Chengdu MixC inter-institutional REIT, and continues to be responsible for the project operation and management relying on MixC Life, retaining core rights and operational dominance.

Zhao Wei revealed that the planned annual scale of the company's REITs business in 2026 is 100 billion to 150 billion yuan. In addition to Chengdu MixC, commercial real estate REITs in Nantong and Linyi are under application, and the company will also launch the establishment of the second phase of the Pre-REITs fund.

In the first half of this year, China Resources Land had 98 shopping malls in operation, achieving a turnover of 12.44 billion yuan, a year-on-year increase of 19.4%, with an occupancy rate of 98.0%, a year-on-year increase of 0.7 percentage points; the turnover of office buildings reached 780 million yuan, a year-on-year decrease of 4.2%, and the occupancy rate of office buildings was 74.3%, a year-on-year decrease of 0.2 percentage points.

During the period, China Resources Land's recurring business income reached 22.61 billion yuan, a year-on-year increase of 9.9%, accounting for 33.3% of the total turnover; the core net profit of recurring business reached 6.65 billion yuan, accounting for 65.5% of the core net profit.

Amid the pain of actively slowing down the development business, the recurring business not only supports half of China Resources Land's net profit, but also establishes a new growth mode through stock revitalization and REITs capital cycle.

This article is from the WeChat Official Account "Shidai Caijing APP" (ID: tf-app), written by Liang Zhenyu, edited by Li Qian, and published with authorization from 36Kr.