In recent years, underground pipe racks have been extensively constructed in urban areas of China for laying municipal pipelines. As the corridor has a tunnel-shaped underground structure, it can preheat the outdoor air entering from outside in winter. In this study, an underground air-pipe rack heat exchanger (APRHE) system used for residential heating in Xiaoguwei Island, Guangzhou was tested for its thermal performance in winter. Results show that the preheating performance of the APRHE was remarkable and its performance was better at night than during the day. The APRHEs of 150-m long comprehensive and cable trenches can preheat and maintain the air temperature at 21.6 °C and 22.4 °C at night, which were 12.0 °C and 12.8 °C higher than that of the outdoor air, respectively. Their average heating power at night reached 23.9 kW and 24.6 kW, respectively, and the average daily heating energy reached 590.7 kWh and 603.2 kWh, respectively. The preheating performance of the APRHE and its feature of better air quality at night than that during daytime render it a good candidate for residential heating. It is recommended that the preheating length could be set at 100 m. The static and dynamic payback periods of the APRHE residential heating system were estimated at 3.17 and 4.37 years, respectively. The air quality in the pipe rack under the calm wind condition however failed to meet the specifications completely, with the air quality at night being better than that during the day due to the difference in the emission of vehicle exhaust.