Author: Cao Anxun Editor: Zhou Zhiyu
In the past 40 years, Country Garden and Evergrande have been the "bosses of private real estate enterprises" for many years, but they have all fallen in this round of real estate adjustments, and now, Binjiang Group from Hangzhou has replaced them and become the new boss of private real estate enterprises.
According to recent statistics from CRIC, in the first four months of this year, Binjiang Group surpassed Country Garden and Longhu with full-caliber sales of 35.59 billion yuan, ranking first among private real estate enterprises.
Behind the replacement of the "boss of private real estate enterprises" is the change of the law of real estate. The rise of the bosses of successive private real estate enterprises relied on stepping on the wind and catering to the value evaluation system of the capital market at that time, but as the industry went through the stages of germination, land dividends, and financial dividends, they no longer stood at the forefront of the tide.
Even Binjiang, the new "boss of private real estate enterprises", is also trying to get rid of the path dependence of the past and find a way to live in the second half of the real estate industry.
In the future, the change speed of the "boss of private real estate enterprises" may be slower. In the second half, the "boss of private real estate enterprises" will compete in the region's deep cultivation ability, product power, and soft power of business operation, etc., which are all long-term capabilities accumulated and developed. A new era has begun.
breakthrough
After leading Binjiang Group to enter the top 10 of the sales list for the first time last year, Qi Jinxing, a real estate tycoon in Hangzhou and chairman of Binjiang Group, has gone one step further this year.
In the first four months of this year, Binjiang achieved full-caliber sales of 35.59 billion yuan, about 3 billion yuan higher than Longfor, ranking 8th among national real estate enterprises and 1st among stable residential real estate enterprises. Binjiang is no longer just the "first brother of real estate" in Hangzhou, but has become the "boss of private real estate enterprises" in the country.
There are early signs of this. After Binjiang's sales ranking rose two places against the trend last year, and together with Longfor, it became one of the few "top students" of private real estate enterprises without insurance, and this year's Binjiang development momentum has become more and more ferocious in the sales and land auction market.
In mid-April, Binjiang spent 7.417 billion yuan to win two plots of land in the third land auction in Hangzhou, becoming the big winner in the land auction.
According to the statistics of the China Index, in the first four months, Binjiang has spent 14.4 billion yuan to acquire land, ranking fourth in the country, which is also the highest ranking of Binjiang land acquisition in recent years, and it is the first place in private real estate enterprises. Next, Binjiang can continue to maintain its leading position in the scale of real estate sales.
Hangzhou's riverside is fortunate, as the "No. 1 real estate city in China" in the past decade has been in the midst of a long period of upside down between new and second-hand houses. Binjiang has also eaten up the market dividends, relying on the quality of products in Hangzhou, as well as the strategy of prudent and domestic financing, so that it has a good business fundamentals.
But it is also deeply bound to Hangzhou, if it is not for the fact that Hangzhou has given a series of policy gift packages this time, and even the end of the purchase restriction era in Hangzhou in the past 8 years, the Hangzhou property market that has been tired may make Binjiang stumble.
Last year, Binjiang achieved revenue of 70.44 billion yuan, a year-on-year increase of 69.7%, but the net profit attributable to the parent company was 2.53 billion yuan, a year-on-year decrease of 32.4%, the first decline in nearly five years.
Binjiang also explained in the annual report that the decline in net profit attributable to the parent company was mainly affected by the increase in the provision for inventory decline during the period.
The new policy of Hangzhou's cancellation of purchase restrictions has eased the pressure on Binjiang to a certain extent.
As of the close of trading on May 16, Binjiang Group's share price hit a new high of 9.14 yuan per share, and the stock price rebounded by more than 60% from the low point of the year, with a total market value of 28.439 billion yuan.
China Securities Construction Investment said that since the beginning of this year, the downward pressure on the Hangzhou property market has been greater, and it is expected that after the introduction of the new policy, the Hangzhou property market is expected to usher in stabilization.
Qi Jinxing was lucky to step on the policy outlet again, and he also realized that Binjiang needed to make some changes.
According to his 2024 plan, Binjiang will continue to promote the implementation of the "1+5" development strategy, that is, in addition to the main real estate business, promote the five major business sectors of services, leasing, hotels, pension and industrial investment.
He also hopes that Binjiang can get rid of its excessive dependence on regional sales and make more breakthroughs in its business. This will also determine whether Binjiang can continue to stand firmly in the position of "the boss of private real estate enterprises".
cycle
When Binjiang replaced Country Garden to the center of the stage, a new page was opened in the history of China's private real estate enterprises. The period when real estate companies and institutions were judging the world by scale is long gone.
In the past, the real estate industry took advantage of the rapid development of urbanization and the explosion of financial dividends in the country, creating a myth of wealth creation.
At the end of the 90s of the last century, it was the embryonic period of the chaos of the real estate market. Riding the wave of reform and opening up, Zhu Mengyi, chairman of the board of directors of Hopson Development, has expanded vigorously in Guangzhou by virtue of the development experience he learned from Hong Kong, and once developed more than 100 buildings a year, becoming the overlord of real estate in Guangzhou.
In 2004, Hopson Development became the first real estate enterprise in Chinese mainland with sales of more than 10 billion yuan, and the first generation of "private real estate enterprise boss".
At that time, Wang Shidu, the founder of Vanke, avoided its edge and once said: "Vanke is not a real estate aircraft carrier, Hopson Development is the real aircraft carrier of China's real estate industry."
Subsequently, with the help of capital, in order to raise more money, achieve a higher market value and industry status, the subsequent real estate companies are vying to expand their territory across the country, and the model of "high turnover, high leverage, and high debt" is regarded as the first criterion in the industry. R&F, Evergrande, Country Garden, etc. have successively become the "boss of private real estate enterprises".
During this period, with similar plays, private real estate giants such as Sunac and Shimao also emerged, as well as dark horses of Fujian real estate such as Sunshine City and CIFI.
However, when the "three red lines" ended the real estate financial dividend in the summer of 2020, these real estate companies were counterattacked.
Xu Jiayin, Huang Qisen, Lin Tengjiao, Pan Weiming and others were taken away or gradually fell silent, and Sun Hongbin, chairman of the board of directors of Sunac, had to run around and boil his hair white to complete the debt restructuring; Yang Huiyan took the initiative to reduce her monthly salary to 10,000 yuan, saying that "the family will definitely smash the pot and sell iron to support the company" to stabilize people's hearts.
After three or four years of cyclical adjustment, the valuation system, financing system and industry pattern that connect the upstream and downstream of the industrial chain are being reshaped at an accelerated pace.
The argument that "scale is king" is increasingly drowned out by the voices of "cash is king", "stability is king" and "operation is king".
S&P Global Ratings predicted in a recent seminar that when the industry fully adjusts and stabilizes again, real estate companies with high-quality fundamentals may still be the most competitive and credit-resilient companies in the industry, such as non-state-owned real estate companies such as Longfor and Binjiang.
They are different, such as Longfor's prudent development layout and the resilience of actively transforming its operating business to build a financial moat, or Binjiang dominates one side by refining and refining the regional market, but they all have one thing in common, that is, stability, financial self-discipline, and through multiple cycles.
In the future, as the industry stabilizes and recovers, and gradually comes out of chaos, private real estate enterprises will also start a new battle for the leader. At that time, the real estate rivers and lakes will also rise again.
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