# Has Yuexiu Property Really Come Under Pressure After High-Price Land Acquisition and Rating Downgrade?

Ask AI · What is the strategic significance of Yuexiu Property’s counter-cyclical land acquisition?

Produced by | China Visitor Network

Reviewed by | Li Xiaoyan

By the end of February 2026, the Ma Chang plot in Zhujiang New Town, Guangzhou, was sold for 23.6 billion yuan, with an over 26% premium rate. Yuexiu Property acquired this rare core city site, setting a new record for residential land price in Guangzhou and injecting strong confidence into the market. Almost simultaneously, Moody’s downgraded the company’s family rating to Ba2, sparking discussions about its financial security and investment logic.

As a core state-owned enterprise in Guangzhou, Yuexiu Property’s significant land acquisition reflects a firm confidence in the city’s value and demonstrates the responsibility of a state-owned enterprise to counter-cyclically deploy assets and serve urban development. During a period of deep industry adjustment, Yuexiu relies on stable finances, core assets, and differentiated advantages to balance short-term pressures with long-term value, showing resilience and confidence through cycles.

The transfer of the Ma Chang plot highlights the concentrated value of land in Guangzhou’s core area and is a key move in Yuexiu’s strategic layout. The total price is 23.6 billion yuan, with a residential floor price of about 85,000 yuan per square meter. The plan includes high-end residences, a five-star hotel, luxury commercial facilities, education and public services, and ecological amenities. The total investment is expected to exceed 40 billion yuan. Once completed, it will become the landmark at the end of Zhujiang New Town’s Golden Triangle. From a city development perspective, this project fills a top-tier consumer scene gap in South China, boosts the area’s overall level, aligns with Guangzhou’s strategy to build an international consumer center city, and offers significant long-term economic and social value.

Market concerns about project funding pressure and payback periods are objective but should not be exaggerated. Moody’s downgrade mainly indicates that short-term leverage remains high and deleveraging has slowed, but the outlook has been changed from negative to stable. This is a crucial signal: institutions recognize that Yuexiu has no systemic repayment risks, and they are only cautious about the pace of financial improvement, not the overall operational safety of the company.

Financial data confirms Yuexiu’s short-term liquidity safety margin. As of June 2025, the company’s cash and cash equivalents totaled approximately 42.253 billion yuan, covering about 25.39 billion yuan of short-term debt due within a year, with a cash-to-short-term debt ratio of 1.7 times. Excluding prepayments, the asset-liability ratio is 64.6%, and the net debt ratio is 53.2%, maintaining compliance with regulatory thresholds. The company’s seven USD bonds amount to $1.729 billion, with an average financing cost of only 3.16%, among the industry’s lowest, with smooth financing channels and controllable costs, making the risk of a short-term liquidity break extremely low.

Yuexiu’s core net profit in 2025 declined year-on-year, a common challenge during industry downturns rather than a sign of mismanagement. Despite a shrinking market, Yuexiu maintained active land acquisition, investing about 126.95 billion yuan since 2024, with a land acquisition-to-sales ratio of 56%. While seemingly high, this reflects a strategic reserve of quality assets at low prices typical of state-owned enterprises. The Ma Chang commercial component accounts for nearly 70%, which lengthens the capital recovery cycle but, leveraging Yuexiu’s mature commercial operations and state resources, can generate stable rental and operational income long-term, hedging against residential development cycle fluctuations and creating a more balanced profit structure.

Yuexiu’s continued focus on Guangzhou is not blind expansion but a rational choice based on the city’s fundamentals and its own strengths. In 2025, Yuexiu acquired nine parcels in Guangzhou totaling 10.616 billion yuan, ranking first in the city and accounting for 21% of all residential land transactions. It was the only developer in Guangzhou to break 10 billion yuan in land acquisition that year. This high concentration on core cities stems from Guangzhou’s robust economic base: by 2025, Guangzhou had over 4.2 million operating entities, nearly 9.83 trillion yuan in deposits, and a total import-export volume of 1.2 trillion yuan, with export growth leading the province, providing a solid foundation for high-end real estate demand.

Compared to other developers, Yuexiu’s unique TOD model and subway shareholder resources give it advantages in land acquisition at transit nodes, with better information, cost control, and absorption guarantees. The 2025 acquisitions in Jiamei Wanggang and Tangxia are located in key urban functional zones, aligning with population movement and urban expansion trends. Sales performance further validates the strategic layout: the Baiyun Yuexiu·Yuncui project sold out at launch; Longyue Xiguan sold out within six months; the luxury Puyue Villas set a record with a single unit transaction of 62.59 million yuan. The total contract sales for the year remained at 106.2 billion yuan, demonstrating strong product strength and market recognition during an industry downturn.

The land reserve structure further consolidates safety margins. About 94% of Yuexiu’s land bank is in first- and second-tier cities, with Guangzhou occupying a core position. High-tier cities’ resilience is significantly better than that of third- and fourth-tier markets. Although concentrated, this strategy focuses on leveraging core advantages and deepening the main base, creating scale effects in resource input, brand influence, and absorption efficiency, aligning closely with the prudent management philosophy of state-owned enterprises.

Currently, Yuexiu faces the common balancing act for SOEs during industry transformation: on one hand, fulfilling social responsibilities such as stabilizing land prices, promoting renewal, and enhancing urban functions; on the other, maintaining profitability and financial health of the listed company. This dilemma is not a management crisis but a necessary choice during high-quality development. Yuexiu stabilizes market expectations through land acquisition, maintains risk bottom lines with financial discipline, and delivers market demand with high-quality products, finding a feasible path between responsibility and benefit.

Looking ahead, the value of the Ma Chang site will gradually be realized over time. Backed by the full support of Yuexiu Group, which manages over one trillion yuan in assets, and leveraging its core advantages in commercial operations, TOD development, and state credit, Yuexiu has the capacity to ease mid-term cash flow pressures and ensure smooth project implementation. As demand for high-end residential and commercial properties in Guangzhou’s core area continues to grow, project absorption and operation are expected to outperform expectations, gradually improving financial indicators and steadily reducing leverage.

This rating adjustment reflects normal short-term financial rhythm rather than a long-term valuation decline. Yuexiu Property, with core assets as its shield, stable finances as its foundation, and urban co-building as its mission, actively responds and strategically deploys during industry adjustments, demonstrating corporate responsibility and building long-term momentum for growth.

The market should look beyond short-term fluctuations and focus on the long-term logic of core cities, core assets, and core capabilities. Yuexiu Property’s choices reflect confidence in Guangzhou’s future and an understanding of industry trends. In the new phase where real estate shifts from scale expansion to quality improvement, companies that stick to their core and operate prudently will ultimately navigate cycles and realize long-term value.