“The renewed focus on debt levels, especially in the real estate market, means challenges for developers, encouraging them to proactively offload noncore assets,” said the global property adviser in its latest report.

Cushman & Wakefield believes the recent introduction of tough new government rules designed to limit the borrowing capacity of developers already laden with debt will force many to raise capital by selling assets.

“Under the strict ‘three red lines’ finance regulations, real estate firms determined as falling into the orange and red tiers are more likely to seek to dispose of assets, and we can expect to see more quality projects in core locations to enter the market through auction and so forth,” said Alvin Yip, head of capital Markets in China at the property services giant.

R&F, ranked 21st among Chinese developers by home sales, is categorised as red currently, meaning it is in breach of all three thresholds set out in the new regulations.

It had a liability-to-asset ratio of 78.2 per cent, excluding advanced proceeds, and a net debt-to-equity ratio of 179.7 per cent, according to the latest data from Wind Information. Its cash-to-short term debt ratio stood at 0.46, and its total debts came to 187.7 billion yuan (US$29 billion).

R&F said earlier that the sale of the logistics park was aimed at “optimising the allocation of resources, focusing on the development of [its] core business, increasing capital reserve and reducing [its] gearing ratio”.

Some developers have been trying to shed debt through aggressive property sales.

China Evergrande, the most indebted company in China with accumulated loans of 835.5 billion yuan, slashed prices by 30 per cent in all of its projects nationwide for a month in September to shore up cash flow. Its property sales grew by a robust 20.3 per cent year on year to 723.25 billion yuan in 2020, according to a filing with the Hong Kong stock exchange.

R&F’s logistics park, located in Huadong County in the Huadu District of Guangzhou, has a planned total construction area of more than 1.2 million square metres.

Some 889,820 square metres of rentable area comprising warehouses, plants and cold storage are currently completed. There are also supporting facilities, and an undeveloped land area for warehouses of about 140,000 sq m.

Blackstone said the transaction expands its China logistics portfolio by about a third to 53 million square feet across 23 Chinese cities.

Cliff Chen, a Blackstone managing director based in Shanghai, said: “We look forward to further developing the park by constructing additional cold storage facilities tailored for food and pharmaceutical industries as well as institutional-quality warehouses.”