The home builder will auction a plot of land in its home base in Shenzhen in southern Guangdong province at a starting price of 2.2 billion yuan (US$304.5 million), according to a Wednesday listing on Shenzhen Public Resources Trading Centre. The bidding process will start on May 18, it added.

Vanke bought the 19,227-square metre site in Nanshan district in December 2017 for about 3.1 billion yuan, according to past land auction information. The plot is located within a commercial zone where the Shenzhen government has planned to build a skyscraper with offices, hotels and shopping malls.

“The listing of this land plot is part of the company’s move in a basket scheme [to dispose of its noncore assets],” Vanke said in a written response to the Post. “Given that the industry has undergone a significant change, the company no longer plans to construct this project and will focus its resources on its main businesses.”

Vanke and many of its peers have struggled to appease lenders and creditors as home sales slumped since China imposed its “three red lines” policy, pushing the nation’s weakest builders into a financial crisis. China Evergrande Group fell into bankruptcy, while others like Fantasia, R&F Properties and Shimao have been forced to reorganise their debts.

Moody’s cut Vanke’s credit rating to junk in early March, citing debt repayment pressure.

The state-backed developer has said the rating downgrade was manageable and that the firm remained financially sound. At a meeting with shareholders a week ago, Chairman Yu Liang is leading the group’s three-pronged strategy to trim debt, exit noncore business and reassess its funding strategies.

That entails cutting its debt by more than 100 billion yuan in the next two years, reducing its leverage to less than 50 per cent in five years, and tweaking its fundraising model to “project-led” from “company-led” basis. It will put resources into residential projects, property management services and property rental, Yu said.