(Yicai) May 8 -- Struggling property developer China Vanke will auction a piece of land for building offices in Shenzhen from CNY2.2 billion (USD304.5 million) to cash out money from non-primary business assets.

Vanke will auction a 19,000-square-meter land in the Shenzhen Bay Super Headquarters Base between May 18 and May 27, Shenzhen Public Resources Trading Center announced today. The bid increment is CNY10 million (USD1.4 million), and the bidders’ security deposit is CNY447 million (USD61.9 million).

Shenzhen-based Vanke bought the piece of land for CNY3.1 billion in 2017 to build office buildings and supporting commercial facilities of up to 167,000 sqm of construction area.

Vanke purchased the land when the real estate industry was developing rapidly, as it planned to build offices for its employees in Shenzhen, but it has now decided to sell the land to raise money from its non-primary business, the firm told Yicai today.

On April 30, Vanke mentioned at its shareholders meeting that it would adjust its business strategy to focus its resources on its primary businesses of building residential properties, property management services, and apartment leasing, thus starting to sell non-primary business assets and investment projects.

Vanke’s interest-bearing liabilities totaled CNY320.1 billion (USD44.3 billion) as of the end of last year, of which about 20 percent are due this year, according to its latest annual earnings report released in March. The company would cut CNY100 billion in liabilities within the next two years, it added. 

In the first quarter of the year, Vanke’s financial performance worsened. The firm reported a net loss of CNY362 million in the three months ended March 31, compared with a net profit of CNY1.4 billion a year earlier, according to its first-quarter financial statement released on April 29. Revenue fell 10 percent to CNY61.6 billion in the period.

Editors: Dou Shicong, Futura Costaglione