Entering 2022, the arrival of the "Bronze Age" in the real estate industry has become the consensus of the industry. Skipping the Golden and Silver Ages and stepping from the "Platinum Age" to the "Bronze Age" is a fact that many people are reluctant to accept, but they have to face.
According to the data released by Kerui, as of the end of December 2021, about 40% of the cumulative sales and trading amount of the top 100 housing enterprises fell year-on-year, and the rest were still the same as the previous year or maintained a positive growth trend. However, overall, the data is not optimistic, and the sales of the top 100 housing enterprises decreased by 3.5% year-on-year compared with 2020, which is the first decline since 2011. Industry insiders predict that 2022 or will usher in the first negative growth in 20 years, the future industry scale will also return to five years ago.
The balance has been broken, and the overall real estate industry pattern will be reshaped in 2022, and enterprises that are forward-looking, adhere to long-termism, actively build product strength and take the initiative to assume social responsibility will be able to survive through the cycle. Longguang Group (03380. HK) is a company in the industry that has these qualities. In the past year, Longguang's sales performance has been remarkable. According to the company's performance announcement released on January 10, the company achieved equity contract sales of approximately RMB13.05 billion in December 2021, an increase of 18% month-on-month. As of December 31, the company achieved equity contract sales of about 140.2 billion yuan for the whole year of 2021, an increase of 16.2% year-on-year.
Founded in 1996 and listed on the main board of the Hong Kong Stock Exchange in 2013, Longguang Group is an urban integrated service provider committed to building a better life. Over the years, it has closely followed the national development strategy and laid out the most valuable core metropolitan areas in China, such as the Guangdong-Hong Kong-Macao Greater Bay Area, the core metropolitan area of the Yangtze River Delta and the southwest and central urban agglomerations. To date, more than 150 residential projects have been developed, providing quality habitat services to more than one million people.
Replicating the successful experience of the Greater Bay Area The Yangtze River Delta market has achieved a "good start"
Since the second half of 2021, the cold winter of the real estate industry has begun, the market has begun to decline, the policy has increased, the financing has declined sharply, the market has continued to turn cold, and the transaction area of 100 cities has continued to decline, and the year-on-year decline has expanded to more than 30%. Individual large-scale housing enterprises are exposed to risks and thunderstorms occur.
In the adjustment period of the real estate industry, sales were sluggish, but Longguang Group ushered in a good start against the trend. On January 12, 2022, as soon as the Shanghai Longguang Tianjing project opened, it was sought after by the market, and the 311 units launched were sold out on the same day, with a sales amount of nearly 4 billion yuan, achieving a "good start" in 2022.
Shanghai Longguang Tianjing is located in the East Bund plate of Yangpu District, close to Aiguo Road Station of Metro Line 12, with convenient transportation and mature supporting facilities. This is also the first project of Longguang Group to enter Shanghai, which belongs to the longguang modern series of high-quality works, and the number of subscribers exceeded 930 groups, ranking the forefront in the sixth batch of new projects in Shanghai.
Longguang Tianyao, the second high-quality project built by Longguang Group in Shanghai, has also received hot subscriptions. The project is located in the core location of the Lingang Free Trade Zone, close to the planned Two Ports Express, a large-scale urban complex with a total construction area of about 500,000 square meters, and will be equipped with Longguang's high-end commercial brand "Blue Whale World", with a total value of nearly 8 billion yuan, which is expected to create another sales performance.
Over the years, Longguang Group has been committed to regional deep ploughing and accurate layout. The Guangdong-Hong Kong-Macao Greater Bay Area and the Yangtze River Delta are the focus of Longguang Group's deep cultivation and the center of the company's resource allocation. Since opening up the Yangtze River Delta market in 2018, by replicating the successful experience of the Greater Bay Area, nearly 30 projects have been expanded in many high-energy cities such as Shanghai, Nanjing, and Ningbo.
According to the announcement, more than 80% of the value of Longguang Group is located in areas with development space such as the Yangtze River Delta and the Greater Bay Area, and its value in first- and second-tier cities accounts for 94%, which is expected to provide favorable support for the company's stable future performance.
With the "out of the circle" product force to build a solid foundation for sustainable development
With the change of the times, people's living needs are also constantly upgrading and changing, around the positioning of urban comprehensive service providers, these changes will continue to become an important basis for the real estate industry to polish product strength. Especially in the context of housing and not speculation, the logic of high leverage and high turnover has changed, and relying on product power to create a circle has become the consensus of the industry.
Industry insiders said that the two high-value projects in Shanghai have made a beautiful start, which means that Longguang Group's off-site expansion has achieved remarkable results. The opening of the Shanghai Tianjing project was completely cleared at one time, highlighting the solid product strength advantages of Longguang Group, which will help further consolidate the competitiveness of the Yangtze River Delta market, accelerate the return of sales funds, and ensure the steady growth of annual performance.
"Customer demand" is the driving force for Longguang Group's product exploration. Over the years, Longguang Group has taken "urban comprehensive service provider" as the strategic starting point and "responsibility to build a city, build a home with a heart" as its brand development concept, and in the process of steady development, it has created a model of high-quality intelligent and beautiful urban life and created a "Longguang-style" beautiful life.
In addition to development business, Longguang Group actively explores new business models to enhance its sustainable management capabilities, and its commercial projects are also continuously empowering. Its commercial real estate projects are also recognised. In late December 2021, shenzhen bright blue whale world under the company won the "2021 China TOD commercial complex benchmarking project TOP5".
It is reported that Shenzhen Guangming Blue Whale World is the result of Longguang's in-depth excavation and exploration of the value of TOD functions, which organically integrates shopping malls with theme shopping streets, selected hotels, elite residences, ecological parks and other formats to form a three-dimensional micro-urban space integrating transportation, commerce, commerce, culture, parks, residences and other functions, and has achieved remarkable results in improving the land premium rate and enhancing the core competitiveness of products and regional support.
With the industry's leading product innovation ability and continuously improving product strength, Longguang Group ranked 15th in the "2021 China Housing Enterprise Super Product Force TOP100", and ranked among the top 10 builders and top 10 landscape builders in China, which once again highlights Longguang's outstanding advantages in product innovation and product force building. Longguang Group said that in the future, it will continue to focus on product innovation and upgrading to create more value for customers.
Financial soundness escorts long-termism
Behind Longguang Group's "opening red" and beautiful sales results in 2022 is not only its forward-looking strategic layout and the hot sales reasons for a number of flagship projects, but also the support of the underlying strength of sustainable development that is financially stable and escorts long-termism.
Analysts said that from the perspective of real estate financial policies, in 2022, the prudent management of real estate finance will make appropriate marginal adjustments, which are more reflected in the fact that all localities and financial institutions will consider the transition period when implementing the prudent management of real estate finance, and will no longer increase the number of layers.
Since December 2021, more and more private housing enterprises have benefited and begun to break the ice. Longhu, Gemdale, Country Garden, Longguang and other private real estate enterprises have announced the launch of the issuance of medium-term notes, corporate bonds, and asset-backed securitization products such as supply chain ABS.
On December 27, 2021, Longguang Group (03380. HK) announced that Shenzhen Longguang Holdings Limited, a wholly-owned subsidiary of the Company, successfully issued RMB665 million of asset-backed securities to qualified investors. The securities received the highest credit rating from AAAsf, with a maturity of 12 years and an annual coupon rate of 5.2%, showing that the regulatory authorities and investors fully recognize the company's sound operation ability and high-quality asset quality.
In addition, Longguang Group also has corporate bonds, asset-backed securitization products and other continuous approvals, which means that the company's financing channels remain smooth.
Industry insiders said that the success of financing will help Longguang Group continue to optimize the debt structure, enhance cash flow advantages, and consolidate the competitiveness of enterprises. With the favorable real estate policy, it will gradually be transmitted to the financial system and capital market. The support of financial institutions for private housing enterprises will be improved, and the market's confidence in high-quality private housing enterprises is expected to be rebuilt.
Longguang Group's steady financial and high-quality development has been highly affirmed by the market. In March 2020, the company was included in the Hang Seng Composite Index as a large stock, and its leading position in the industry was recognized by the international capital market. In 2021, it ranked 161st in the list of China's top 500 enterprises, the top 1000 global listed companies in Forbes, and the 18th in the comprehensive strength of Chinese real estate enterprises, and its brand and comprehensive strength continued to improve, which was widely recognized by the society. CCB International and other institutions continue to recommend buying Longguang Group (03380. HK) stock, and predicts that the company's 2022 performance is stable, the financial performance remains "green", and the dividend continues to be generous, which is the long-term value choice of investors.
North/Text