(Yicai) June 22 -- More than 40 property developers in China have made senior executive changes since the start of the year amid weak sales, losses, restructuring, and stricter performance metrics.

So far this month alone, 11 developers have reshuffled their executive teams, including chairpersons and general managers. Li Yan, chairman of Beijing Capital Development Holding Group, a local government-backed builder, resigned earlier in June after being in the role since August 2019.

Beijing Capital Development’s sales have been falling since peaking at CNY114.9 billion (USD16.9 billion) in 2021, dropping to CNY17.9 billion (USD2.6 billion) last year. The firm has run up losses of about CNY21.6 billion over the past four years.

China’s real estate market has still not emerged from a deep adjustment phase, with more than 60 percent of developers posting losses last year, Liu Shui, director of enterprise research at the China Index Academy, told Yicai. Liu said weak operating performance is the main reason executive positions have become unstable.

With the market shrinking, some builders have also undergone structural restructuring, causing some executives to leave involuntarily after their roles were eliminated, Liu pointed out.

Furthermore, due to the industry's business model shifting from rapid expansion to stock-based operations, some professionals who excelled in the previous market environment may no longer be suited to the new conditions and are being replaced by newer talent, Liu noted.

In state-owned enterprises, senior executives are now broadly subject to term-based and contract-based management, Liu said, and performance evaluations may make it difficult for some to remain in their posts, Liu said.

For private developers, meanwhile, the industry is no longer in an expansionary cycle. The top priority has shifted from “growing bigger” to “avoiding debt defaults,” Liu said. That shift has led headquarters to claw back authority, and when compensation-linked performance targets are missed, many mid- and senior-level managers end up stepping down, he said.

Editors: Tang Shihua, Martin Kadiev