Chairman Pan Shiyi said although increasing the size of the land bank and developing new projects may increase earnings, buying distressed assets generated profits more quickly.

Chief executive Zhang Xin said: "We see uncertainty in 2009 ... this year's top priority is to buy distressed assets such as office buildings and redevelop them - that's SOHO's strength as well."

Moody's analyst Kaven Tsang said China property prices remain under pressure and inventories of unsold properties are still high, so the recent improvement in sales volume may not be sustainable.

ADVERTISEMENT

Moody's credit officer Peter Choy said relaxing mortgage lending for second-home buyers has spurred demand, even as offshore funding sources remain shut.

SOHO president Yan Yan said its five projects in the Beijing central business district recorded occupancy rates of 90 to 95 percent this year.

Zhang said SOHO China has 7,000 customers, half of whom have at least two transactions with the company. The firm holds a cash position of 10 billion yuan (HK$11.3 billion) and 10 billion yuan credit lines. SOHO China retreated 3.16 percent to HK$4.90 yesterday.