Yuan Yihong: Do we need so much commercial real estate?

It is difficult for small and medium-sized housing enterprises, and it is even more difficult for small and medium-sized real estate developers to develop or hold a large number of businesses.

According to media reports, in the past decade, the construction of commercial business buildings in the country has reached 2.09 billion square meters, but according to industry internal statistics, the completion and opening rate is only about 43%, and the other 57% of the projects have not been opened for various reasons; according to statistics, only 36% of the commercial projects held by the top 100 housing enterprises in the country have reached the break-even point, and 64% of the commercial projects have not reached the break-even point and are in a state of loss.

These numbers startled me. Of the 2.09 billion square metres of commercial housing started, 57% were not opened, that is, 1.19 billion square metres were in a state of decay or idleness. If you add a large number of properties that have closed or left idle after opening, the number of commercial buildings in the unoperated state is even larger. In the commercial projects in operation, the loss rate of up to 64% is also really amazing, if converted into area, it must also be calculated at the level of 1 billion square meters. However, these statistics are monitored by commercial management bodies and their accuracy is somewhat questionable.

Over the years, commercial housing, as well as commercial real estate in a broader sense, is not easy to do, does not do well, and has serious losses, and it is indeed the consensus of the industry. In the mainstream housing enterprises, many of them are residential sales and holding properties at the same time, but the steady growth of commercial income has even become the main source of income, which is extremely rare. Some housing enterprises rely on financial technology to operate, and the continuous revaluation of commercial value can reflect the growth of this piece of revenue in financial figures.

To put it bluntly, our real estate developers and commercial operation management institutions have made little progress in commercial development and operation in the past 20 years. Either, it is to do business in the mode of residential development and sell it; or, from department stores, malls, professional markets to shopping streets, although the form is also changing, but the investment and operation are still the traditional set. With the change of consumption structure and consumption preferences, it is only a matter of time before they are abandoned by consumers.

Commercial real estate, it's time to reflect. The entire industry chain needs to be reshaped. I would like to make only three points:

First, all localities should appropriately reduce the supply of commercial land. Many urban planning and regional detailed planning arrangements for various industries are still the thinking of 20 years ago, and the proportion of business must be maintained, regardless of the fact that there is no need for so much business today! There is absolute oversupply, and from the date of construction, no, from the date of land transfer, it is doomed that such commercial projects will not be able to operate on time, and even if they are operated, they will inevitably go out of business.

Seek truth from facts, do a detailed and solid research, and predict how much commercial land is approved for as many commercials as needed. There are so many commercial buildings in the area that are dangling and idle, don't you see it? In some districts, in order to pull a literal investment, they will inevitably be retaliated by the market for the purpose of completely ignoring actual needs and insisting on arranging large businesses.

The reduced indicators of commercial land should be transferred to residential land. Dozens of cities with greater upward pressure on housing prices have more or less tight residential land indicators. These cities want to increase the supply of residential land, which is the direction of construction planning and regulation repeatedly pointed out by the former Ministry of Land and Resources and the ministry of natural resources and the Ministry of Housing and Urban-Rural Development.

Second, rotten and idle commercial housing and commercial land projects should be converted into rental residential or long-term rental apartment projects as soon as possible. The idle commercial idleness of more than 1 billion square meters is a huge waste of urban resources. The policy on the transfer of business to housing has been barrier-free, whether it is the documents of the state office, the Ministry of Housing and Urban-Rural Development, the Ministry of Natural Resources, and the documents of various provinces and municipalities. Regrettably, however, there is a lack of practical action. Cities that are carrying out rental housing pilots should introduce a number of samples of commercial housing conversion into rental housing, and the procedures of various departments have given the green light. This is beneficial to improving the appearance of the city, increasing tax revenues, and alleviating the contradiction between housing supply and demand. Hurry up and wait and see.

Third, commercial products should look forward to consumer trends, keep up with consumer preferences, and always keep fresh from dynamic line design to post-service. Some housing enterprises do commercial real estate, or use the idea of doing residential, self-righteous, do not study the user psychology at all, the product is rough and old, a listing is backward, to be eliminated, let alone lead the trend. Some shopping streets have been very popular, and you do business in the same area after three days of opening and then snubbed, why? Quite simply, people's products hit the needs of consumers and are often new.

Speaking of the decline of business, we will cite the example of e-commerce, as if the impact of e-commerce on offline business is the inevitable result of commercial decline. But in my community, there is a foreign-developed commercial project, which is also the form of mall, and there is no big name, it has been open for more than 10 years, it has always been very lively, and some small shops have not been changed for so many years. A commercial project with about the same business area 300 meters away from the same street closed a few years ago.

Jun is not seen, e-commerce has also opened a large number of stores offline. It shows that there is still a large market for physical commerce. The person in charge of a commercial chain brand told me that the retail business in big cities is running well, and its profit margin is no worse than that of developing residential buildings.