Lost 1.7 billion, Ryan Property Group reports its first loss in five years. Lo Ka-shui: Market correction is not over yet; urban renewal is the future development focus.

Image source: TuChong Creative

“Over the past year, the environment for real estate operations has not been easy, and there has been tremendous pressure, with consumer market growth being extremely slow. As a developer, we also feel that the financing market is very difficult, so we need to pay close attention to liquidity,” said Luo Kangrui with感慨.

On the evening of March 26, the well-established Hong Kong–funded real estate developer R&F Properties (00272.HK, hereinafter “R&F” ), held a 2025 results briefing session. Chairman Luo Kangrui, Vice Chairman Luo Baoyu, Finance Director and Investment Director Sun Haohao, Administrative Chief Executive Wang Ying, and Administrative Chief Executive Zhang Bin of R&F subsidiary R&F New Town Co., Ltd. attended the meeting.

According to the earnings report released earlier that afternoon, in 2025, R&F’s revenue was RMB 4.093 billion, down 49.92% year over year; profit attributable to shareholders was RMB -1.782 billion, marking the first loss in the past five years.

In this regard, Finance Director and Investment Director Sun Haohao explained that the loss this time was mainly due to valuation impairment of the company’s rental properties and an impairment allowance provision for inventories, and it was not a real loss. If the impact of the two items is excluded, R&F recorded core profit of RMB 397 million in 2025, down 12% year over year.

Looking ahead, Luo Kangrui believes that the adjustment in the real estate market has not yet been completed and will likely continue for another two to three years, and the trend toward bottoming out will persist. However, he also pointed out that there is still demand in the market for high-quality properties, and that urban renewal and village-in-city redevelopment will be the focus of future development.

Last year, property sales revenue was only RMB 500 million, and there are still RMB 17.2 billion in sales proceeds on the books awaiting recognition

Looking through the financial report, it can be seen that the “main culprit” behind R&F’s nearly halved 2025 revenue is the clear shrinkage in the scale of property sales revenue.

In 2025, the property sales amounts recognized as revenue by R&F were only RMB 499 million, down by RMB 3.857 billion from RMB 4.356 billion in 2024. The reason behind this is that in 2025, R&F did not have any new residential projects completed.

Although revenue recognized on transfer was limited, R&F performed well in new home sales. In 2025, R&F achieved contracted property sales of RMB 7.916 billion, of which residential sales were RMB 7.246 billion and commercial property sales were RMB 670 million.

As Administrative Chief Executive Wang Ying of R&F explained, last year’s contracted sales of R&F mainly came from two projects in Shanghai: “Cuihu Tiandi · Liuhe” and “Wuhan Tiandi · Yuny i”.

Among them, for “Cuihu Tiandi · Liuhe,” its landscape villas and townhouse products, due to their scarcity and the unique lifestyle they embody, once again drew strong attention and a large number of subscription intentions from high-net-worth customer groups. The villas and townhouses for which pre-sale permits had been obtained were all sold out; for the remaining villas, once pre-sale permits are approved, contracts can be completed. As for “Wuhan Tiandi · Yuny i,” as the concluding residential project of Wuhan Tiandi, its sales momentum after entering the market was also very strong. By the end of 2025, the sell-through rate had already exceeded 72%, and the transaction volume was far higher than other high-end residential projects in the same area. The project is now close to being fully cleared.

Wang Ying disclosed that by the end of 2025, R&F had locked in sales proceeds totaling as much as RMB 17.231 billion that are expected to be recognized as formal revenue, to be delivered in 2026 and thereafter, and will be confirmed in subsequent performance reporting.

Commercial rents grew for three consecutive years

Compared with property sales, commercial rental income—another major core business of R&F—shines even more.

According to industry information, in 2025, markets for office buildings nationwide and for retail properties were both in intense competition. Taking Shanghai as an example, according to data from JLL, office building rents in Shanghai were RMB 5.2 per square meter per day during the year, down 11.6% from the same period last year; for retail properties, rents for shopping malls in Shanghai’s prime locations and those in non-prime locations fell year over year by 4.3% and 6.4%, respectively.

The financial report shows that in 2025, R&F recorded rental and related income (including income from joint ventures and associates) of RMB 3.625 billion, up 2% year over year, maintaining growth for three consecutive years. Among this, property rents and related income from its headquarters in Shanghai totaled RMB 2.826 billion, accounting for 78% of total rental income, up 3% year over year.

Among the many projects, Hongshoufang, which opened at the end of September 2023, saw rental and related income increase 49% year over year, mainly driven by a rise in the office building portfolio’s combined occupancy rate; Shanghai Tiandi’s rental and related income increased 14% year over year, mainly benefiting from the opening of Dongtai Li within Tiandi; and Panlong Tiandi’s rental and related income increased 7% year over year.

However, in an environment of fierce market competition, R&F is not immune to the effects. The company also noted in its financial report that in 2025, the renewal rents for its retail properties and office buildings both declined.

Regarding R&F’s 2026 operating strategy for its commercial segment, Zhang Bin, Administrative Chief Executive of R&F New Town, said that the retail segment will continue to enhance fundamentals such as operating revenue and passenger flow through diversified and innovative approaches to achieve win-win outcomes with tenants. Taking Shanghai as an example, it can leverage inflows of external visitors to build advantages in retail differentiation, while continuing to roll out culture-and-experience content that aligns with the characteristics of Tiandi to drive upgrades to the tenant mix. As for the office segment, it will treat improving occupancy rate as the top priority, strengthening competitiveness through flexible leasing strategies and high-quality services such as customized renovations and sustainable office solutions, while continuously expanding value-added services beyond physical space.

Light-asset expansion for urban renewal

By looking back at past financial reports, it can be found that in recent years, R&F’s land reserves in its headquarters city of Shanghai have been declining rapidly. As of the end of 2025, the total gross floor area available for lease and for sale in R&F’s development and future development projects in Shanghai was 169,000 square meters. In 2020, this figure was 2.08 million square meters—over the past five years, it decreased by more than 1.9 million square meters.

In terms of project expansion, R&F’s “light-asset strategy” has become its choice. At this results briefing, management also admitted that in the current market environment, the light-asset strategy not only can balance R&F’s investment in funding and capital, but also can maintain its healthy expansion in scale.

In 2025, R&F’s performance in light-asset expansion was also notable. During the period, R&F successfully added two light-asset projects: “Yongxinli,” a high-end residential project within the Shanghai Tiandi community, and “Shanghai Sanlin,” a village-in-city redevelopment project in the Pudong New Area of Shanghai. The company’s actual equity interest was 15% in the former and 13.26% in the latter.

According to Wang Ying, Yongxinli will be developed and operated using the Cuihu Tiandi brand. The relocation and resettlement work for the project has been completed in full; construction is planned to start formally in the first half of this year, with the overall completion expected in 2031. Meanwhile, the Sanlin project is expected to be completed in 2035.

The latest financial report shows that as of the end of 2025, the total number of R&F’s light-asset reserve projects increased to 4, with total scale of residential construction-in-progress and projects pending construction of 1.22 million square meters, and commercial of 291,000 square meters.

It is understood that the four light-asset projects developed by R&F come from urban renewal and village-in-city redevelopment. In this regard, R&F’s Administrative Chief Executive Wang Ying explained that in recent years, governments have been stepping up efforts to promote village-in-city redevelopment. In 2025, Shanghai also issued a new three-year urban renewal plan and clearly stated that in 2026 it will launch a comprehensive village-in-city redevelopment program to accelerate the high-quality development of cities. Against this backdrop, village-in-city redevelopment has become a key focus of urban renewal.

“Panlong Tiandi is one of the successful examples of Shanghai village-in-city redevelopment that everyone is familiar with. Not only does it improve the regional environment, it also effectively promotes the prosperity of the regional economy. The success of this project fully demonstrates R&F’s outstanding capability in the field of village-in-city redevelopment, and it also gives us confidence in the prospects of similar projects such as Sanlin Tiandi and Zhaolou Tiandi,” said Wang Ying.

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