Chinese property giant Vanke reported a massive annual loss of 49.5 billion yuan ($6.8 billion), underscoring the ongoing crisis in China's real estate sector. The company cited falling sales and shrinking profit margins as primary factors, despite government efforts to stimulate the housing market. Vanke's filing to the Hong Kong stock exchange described 2024 as an "exceptionally challenging year" and apologized for the "distress caused... due to the significant decline in sales, substantial losses and pressure on our liquidity."

Vanke, partially owned by the Shenzhen government and ranked as China's fourth-largest real estate firm by sales last year, admitted to failing to adapt quickly enough to changing market conditions. The company acknowledged its past reliance on "expansion inertia of high-debt, high-turnover and high-leverage," leading to aggressive investment and over-expansion.

The reported loss marks Vanke's first annual loss since its listing in 1991 and exceeded initial estimates. Revenue declined by 26 percent year-on-year to $47.3 million, attributed to a "significant decrease in the settlement scale and gross profit margin of the development business." The company also announced the resignation of chief operating officer and executive vice president Liu Xiao, who will remain with the company focusing on strategic investment.

Vanke's struggles are compounded by broader issues within the Chinese real estate market. The company had previously seen the resignation of its CEO Zhu Jiusheng in January, reportedly due to health reasons, although some reports suggested further complications. Despite Beijing's support measures announced in November, including lowered deed tax rates, Vanke still suffered substantial net losses in the final quarter of last year.

The company anticipates facing concentrated public debt repayments this year, intensifying liquidity pressures. Reports indicate that Chinese authorities are considering plans to help Vanke address a $6.8 billion funding gap. Vanke is among several major Chinese property firms grappling with severe financial distress. Kaisa reported a 48.4 percent increase in losses, reaching $4.03 billion, while Country Garden reported an annual loss of $4.5 billion and total debt of $34.9 billion.