The east wind of policy has come, and the German production and investment service is expected to rise against the wind

In the past two years, the development of the new energy vehicle industry chain is in full swing, which is inseparable from the support of policies. For example, in the past few years, the policy has provided help to new energy vehicle companies in terms of credit delivery and tax subsidies.

Nowadays, the east wind of policy has also blown to the property management service industry. According to the statistics of Shengang Securities, in the first half of 2021 alone, there are 4 policies to support the diversified development of the property management service industry.

Under the call of national policies, the property management service industry will open an era of diversified development. In this process, the development of diversified businesses will also become the core factor of competition among property management service enterprises.

In fact, similar trends have been highlighted in some companies. For example, the German commercial production and investment service, which recently landed on the Hong Kong Stock Exchange, is one of them.

In the past few years, German Commercial Production and Investment Services has been vigorously developing residential and non-residential value-added service business and commercial operation service business. From the data level, the results are remarkable. By the end of May 2021, the value-added service revenue of German production and investment services accounted for 48.4%, almost supporting half of the company's revenue.

In the long run, the development prospects of the property management service industry are worth looking forward to. However, dragged down by the overall Hong Kong stock market, the current performance of the property sector is not eye-catching, but compared with other sectors, the decline is small, and many property management service companies have also launched repurchases because the stock price cannot reflect the value of the company.

In this context, Deshang Production and Investment Service announced on January 6 that the over-allotment equity has been partially exercised. This also reflects the recognition of the value of the company by investors to some extent.

Support policies have been intensively introduced, paving the way for the long-term development of the property management industry

In 2021, the Ministry of Housing and Urban-Rural Development, the Ministry of Commerce and other government agencies have repeatedly issued policies to support the accelerated development of the property management service industry.

On January 5, the Ministry of Housing and Urban-Rural Development and other ten ministries and commissions jointly issued the "Notice on Strengthening and Improving Residential Property Management", encouraging qualified property management service enterprises to explore the "property service + life service" model.

On February 21, the No. 1 document of the Central Committee, the Opinions of the CPC Central Committee and the State Council on Comprehensively Promoting Rural Revitalization and Accelerating agricultural and Rural Modernization, was officially released. The document identifies a series of policies to promote the transformation of public management services to socialization, marketization and specialization.

On March 12, Xinhua News Agency was authorized to release the "Outline of the 14th Five-Year Plan for National Economic and Social Development of the People's Republic of China and the Long-term Goals for 2035", and the property was mentioned six times, respectively, involving the quality development of the living service industry, improving the level of urban governance, improving the community management and service mechanism, and building a digital China.

On May 31, the Ministry of Commerce, the Ministry of Housing and Urban-Rural Development and other 12 departments jointly issued the "Opinions on Promoting the Construction of a Quarter-hour Convenient Living Circle in the City", with community residents as the service object, to meet the basic consumption and quality consumption of residents' daily life, and to build a community business circle formed by multi-format agglomeration.

It can be seen from the above policies that the state is encouraging property management service enterprises to expand into non-property management service areas. The reason behind this is not difficult to understand, with the continuous increase of domestic per capita income, it is urgent to improve the quality of life of the people.

From the data, the per capita disposable income of domestic residents in 2020 reached 32189 yuan, double that of 2010. In the context of the continuous improvement of per capita income, people's requirements for property management service companies are not limited to the management services of the public area, but have more personalized service needs, such as door-to-door cleaning, pet breeding, laundry dry cleaning and so on.

Looking at the entire industry, the exploration of German production and investment services in the field of value-added services is undoubtedly relatively leading. In the past few years, driven by the value-added service business, the performance of German production and investment services has achieved rapid growth.

From the data point of view, from 2018 to 2020, the revenue of German commercial production and investment services increased from 63.964 million yuan to 127.922 million yuan, with an annual compound growth rate of 41.4%. Among them, from 2018 to 2020, the company's value-added service business increased from 33.811 million yuan to 66.487 million yuan, becoming the main force driving the rapid growth of German commercial production and investment service performance.

Under the circumstance that the policies to support the development of the property management service industry have been intensively introduced, which has pointed out the direction for the long-term development of the property management service industry, the active exploration of German commercial production and investment services in the field of non-property management services in the past few years has also laid a solid foundation for its long-term development.

Strive for value-added services, and German production and investment services step on the policy rhythm

In the past few years, through the development of value-added services, German production and investment services have taken the lead in the subsequent competition. From the current point of view, German production and investment services have achieved good results in value-added services and commercial operations.

In terms of value-added services, German production and investment services have built corresponding service systems for different scenarios.

For example, in the field of residential property, The German Commercial Investment Service provides users with value-added services such as acceptance of houses, entrusted maintenance, house sales, and housekeeping services. At the same time, the company also provides decoration services for property developers, including sales case decoration.

In the field of non-residential properties, Deshang Production & Investment Services provides branding and positioning consulting services for customers' business promotion, sales agency and marketing business. Subsequently, the Company plans to promote value-added services for industrial parks and office buildings, such as leasing services, indoor rentals, conference hosting and reception services.

At the level of commercial operation services, thanks to the long-term coordinated development with Deshang Real Estate Group, Deshang Production and Investment Services has successfully built a set of commercial operation service systems for the whole industry chain.

Up to now, the commercial operation service capabilities of German commercial production and investment services cover planning, investment promotion, operation, sales and other links.

At the planning level, Deshang Production and Investment Services can provide services such as pre-project planning, commercial planning, and assisting in market expansion planning; at the investment level, the company provides a number of services such as investment management and pre-intervention for its own commercial projects and expansion commercial projects; at the operational level, the company provides operation management, pre-intervention and other services for its own commercial projects and commercial projects; at the sales level, the company has a sales team with omni-channel sales capabilities, which can replace traditional second-hand housing sales.

In addition, in the construction of commercial product models, German production and investment services have gradually formed their own differentiated playing methods. For example, unlike other commercial operation service enterprises, German commercial production and investment services pay more attention to customer segmentation and accurate positioning, and pay attention to scene-based, social, themed, and block-based scene creation.

From the current point of view, German commercial production and investment services have created a number of successful cases. Taking the Youth Tide Play Center as an example, the main target customer group of the Hanabi community is located in the Generation Z youth customer group. In terms of product form, The Fireworks Community mainly takes the form of theme blocks, the block form of large shops with small shops + square as the carrier, with fashion trends and niche social networking as the core, and basic life services as a supplement, to create theme commercial products with the characteristics of city culture and fireworks.

In general, German Commercial Production and Investment Services has rich service experience in the fields of value-added services and commercial operation services. In the long run, this will also help the company to take advantage of the follow-up non-property management service development.

Synergy with Deshang Real Estate Group has emerged, escorting long-term development

While stepping on the policy dividend, the potential resources from the German Commercial Real Estate Group are also an important guarantee for the subsequent growth of the German commercial production and investment service.

According to the official website of Deshang Real Estate Group, the company was founded in 1999 and is a residential developer focusing on mid-to-high-end. Up to now, the asset scale of Deshang Real Estate Group is 40 billion yuan, the development service investment project is more than 200, the business covers more than 30 cities, the development area exceeds 10 million square meters, and the land reserve reaches 6,000 mu.

From the perspective of industry status, Deshang Real Estate Group ranks among the top 100 real estate in China and the top 10 real estate in Chengdu, and won the honors of "2021 China Real Estate Residential Development Professional Leading Brand Value TOP10", "2021 China Value Real Estate General Appraisal Annual Value Real Estate Enterprise", "2020 China Housing Enterprise Product Strength Top 100 Enterprises" and so on.

Since 2010, Deshang A&C Services and Deshang Real Estate Group have established a long-term and close relationship, and the two understand their specific needs and expected deliverables to achieve a win-win situation. Specifically, Deshang Property Group provides a steady stream of projects for Deshang Property & Investment Services, which continues to enhance the brand image of Deshang Real Estate Group and the value of its property development projects through quality services.

According to the data, as of December 31, 2020, three of the properties under management of Deshang Property and Investment Services are mid-to-high-end residential properties in Chengdu; the seven projects in the signed projects are mid-to-high-end residential properties in Chengdu, all of which are mainly mid-to-high-end projects developed by Deshang Real Estate Group. As of May 31, 2021, the 1.1 million square meters of residential property managed by Deshang Property & Investment Services was developed by Deshang Real Estate Group.

Reflected in the financial data, in 2018, 2019, 2020 and the first five months of 2021, the company's revenue from Deshang Real Estate Group accounted for 53.4%, 51.0%, 47.3% and 38.8% respectively, and in the same period, the property management service revenue developed by Deshang Real Estate Group was 100%, 100%, 68.8% and 43.4% respectively.

In terms of lengthening the cycle, with the continuous increase of the development projects of Deshang Real Estate Group, the follow-up will also bring a steady stream of area under management to the German production and investment services.

According to Kerry data, from 2019 to 2021, deshang Real Estate Group's sales exceeded 10 billion yuan for three consecutive years, ranking fifth in Chengdu in terms of sales in 2021. Considering that it generally takes two to three years for real estate enterprises to sell from delivery to delivery, the projects sold by Deshang Real Estate Group in the past three years will gradually be transformed into the area under management of German commercial production and investment services in the next three years, which will promote the continuous growth of the company's performance.

Since most of the residences developed by Deshang Real Estate Group are positioned in the middle and high-end, the consumption power of the customer group is generally strong, and these high-income customers often have personalized consumption needs. In the long run, this will also further promote the rapid growth of the company's value-added service revenue.

With the blessing of multiple benefits, German production and investment services are expected to achieve further development and bring rich returns to investors who have accompanied the company's growth for a long time.