Core Viewpoint - The 15th Shenzhen Real Estate Development Enterprises Social Responsibility and Industry Comprehensive Strength Research Report Conference emphasizes the need for the Shenzhen real estate industry to focus on high-quality development and innovation in a complex environment following the 2025 Central Urban Work Conference [1] Group 1: Industry Insights - The conference was attended by over 200 participants, highlighting the industry's commitment to social responsibility and quality development [1] - The president of the Shenzhen Real Estate Association, Lv Jinchuan, called for the industry to uphold the special zone spirit and contribute to society through innovation, quality, and responsibility [1] Group 2: Company Practices - Deep Rail Real Estate presented its "Good House" standard system, focusing on TOD development to create a well-equipped, livable environment [8] - China Resources Land discussed building an ecosystem of love and kindness, emphasizing community building and property services to create warm living spaces [9] - China Overseas Property introduced its Living OS system, which embodies safety, comfort, green living, and intelligence, showcasing the company's commitment to innovation and responsibility [10] - World Union analyzed the pain points of traditional development models and highlighted the importance of digital marketing and a three-in-one framework of process, data, and technology for real estate transformation [12]

Core Viewpoint - The Shanghai Municipal Government and China Resources (Group) Co., Ltd. signed a strategic cooperation agreement to enhance collaboration across multiple sectors, aiming for mutual benefits and high-quality development [1] Group 1: Strategic Cooperation - The agreement emphasizes leveraging Shanghai's technological innovation, industrial clustering, and business environment alongside China Resources' diverse industry strengths and expertise in state-owned capital investment [1] - The partnership will focus on cooperation in key areas such as integrated circuits, pharmaceuticals and healthcare, energy services, urban construction and operation, industrial finance, and technology and emerging industries [1] Group 2: Goals and Objectives - The collaboration aims to achieve complementary advantages between central and local governments, promoting high-quality development and integration [1] - The initiative supports China Resources in its goal to become a globally competitive world-class enterprise while assisting Shanghai in becoming a modern international metropolis with global influence [1]

Group 1 - The core concept of "Fourth Generation Residential" is introduced by Wangyun, emphasizing innovative space utilization and design [1] - Each unit features an "Air Garden" with a unique staggered design that enhances spatial perception, lighting, and views [1] - The garden serves as a multifunctional area for social gatherings, gardening, and relaxation, providing an open and transparent living experience for all unit sizes [3] Group 2 - China Resources Land has built trust in Jinan over 16 years through practical delivery and respect for local culture [5] - The landscape design of Wangyun reflects the cultural essence of Jinan, integrating natural elements and local heritage into the residential environment [5] - The demonstration area showcases 100% real-life visuals, alleviating concerns about misleading renderings, and features luxurious amenities akin to high-end hotels [7] Group 3 - The success of Wangyun, with sales reaching 800 million, highlights the importance of addressing real-life needs in the housing market [10] - The "Air Garden" is not merely a luxury feature but fulfills the deeper desire of high-income families to incorporate nature into their daily lives [11] - Attention to detail in design, such as bronze metal lines and tropical-style tiles, elevates the property beyond a mere product [13] - The luxurious clubhouse offers practical solutions for social interaction and health management, rather than just serving as a status symbol [14]

Group 1: Commercial Real Estate Trends - The commercial real estate sector is experiencing a divergence, with leading companies like China Resources Land reporting a rental income of 18.56 billion yuan, a 12.2% increase, while weaker firms like China Evergrande face liquidation [2] - The average rental rate for retail properties under CapitaLand China Trust has decreased by 2.7%, yet occupancy remains high at 96.9%, indicating a scarcity of quality properties [2] - The industry is entering a new phase of competition focused on asset quality and operational capabilities, highlighting a "Matthew Effect" where the strong continue to thrive [2] Group 2: Outlet Market Developments - There is a surge in outlet development, with projects like the 3 billion yuan Panda-themed outlet in Chengdu and a 4 billion yuan "Outlet + Amusement Park" complex in Dongguan [3] - Vipshop's outlet same-store sales have seen double-digit growth, and the company is initiating a 3.48 billion yuan REIT fundraising, reflecting strong market confidence in this sector [3] - The trend indicates a rising concentration in the industry, with large-scale, themed, and experiential projects becoming the norm, putting pressure on smaller, homogeneous traditional outlets [3] Group 3: Retail Sector Transformation - Traditional retail is undergoing significant changes, with companies like Bubugao reporting a net profit of over 200 million yuan, largely due to adopting the "Fat Donglai model" which involves closing inefficient stores and revamping potential ones [4] - The first "Fat Donglai self-reform" store by Metro in Beijing has opened, confirming the replicability of this model [4] - In contrast, brands lacking differentiation and user experience, such as GU and Tsutaya Bookstore, are facing closures, indicating a shift towards user experience-centric retail [4] Group 4: Duty-Free Market Growth - The opening of the first city duty-free stores in Shenzhen and Guangzhou marks a significant development in the duty-free economy, following the implementation of new policies [5] - South Korea's announcement of visa-free entry for Chinese group tourists is expected to boost duty-free shopping, with Lotte Duty-Free strengthening partnerships with Chinese travel agencies [5] - City duty-free stores are anticipated to become a new engine for high-end consumption, creating new shopping experiences through a combination of "duty-free + consumption + experience" [5] Group 5: Consumer Spending Trends - In July, the total retail sales of consumer goods grew by 3.7%, with online retail sales increasing by 9.2% from January to July, accounting for 24.9% of total retail sales [6][7] - Companies like 361 Degrees reported a 45% growth in e-commerce business, while Moutai's net profit increased by 8.89%, indicating resilience in high-end brands [6][7] - The restaurant sector saw only a 1.1% increase in revenue, suggesting consumers are becoming more cautious with service-related spending [6][7]

Core Viewpoint - The real estate industry in China is experiencing a significant shift, with the top 10 large enterprises becoming the "stabilizers" of the market as mid-sized companies face collapse. The future may see a consolidation into 5 to 7 dominant players [1][2]. Group 1: Sales Performance - The top 10 real estate companies are undergoing a "dual differentiation" in sales performance, with the leading firms experiencing a decline while the mid-tier companies are showing growth. For instance, only 3 out of the top 10 achieved positive growth, with China Jinmao at 19%, Yuexiu at 11%, and Jianfa at 7% [3][4]. - The head companies are collectively facing negative growth, with Vanke reporting a decline of 46%, and other major players like China Overseas, Poly, and China Merchants also showing significant drops [4][5]. - The average sales growth rate for the top 100 companies has decreased by 11.8%, indicating that even leading firms are not immune to the downturn [5]. Group 2: Land Acquisition Trends - The year 2025 is characterized as a "land acquisition year" for the top 10 companies, driven by improved sales and better land offerings from local governments compared to 2024 [6][7]. - There is a clear distinction between aggressive "Tiger" companies, which are acquiring land at a rapid pace (e.g., Poly's land acquisition increased by 276% to 414 billion, China Overseas by 228% to 393 billion), and the more cautious "Wolf" companies, which are growing at a slower rate [10][12]. - The "Tiger" companies are defined by high acquisition volumes (over 400 billion) and significant growth rates (100% to 300%), while the "Wolf" companies are characterized by lower volumes (below 300 billion) and growth rates under 40% [9][12]. Group 3: Company Classification - The top 10 companies can be categorized into three main groups based on their sales and land acquisition strategies: aggressive, cautious, and balanced [17][34]. - The aggressive group includes companies like Jinmao, China Merchants, China Overseas, and Poly, which exhibit high land acquisition and low sales [23][26]. - The cautious group, represented by companies like Vanke, is focused on maintaining sales while limiting land acquisition, with Vanke experiencing a 45.8% drop in sales and a 95% decrease in land acquisition [27][29]. - The balanced group includes companies like China Resources, Greentown, and Jianfa, which maintain a moderate approach to both sales and land acquisition [34][36]. Group 4: Market Concentration - The concentration of the top 10 companies is increasing, with their land acquisition intensity averaging 0.4, significantly higher than the 0.26 average of the top 100 companies [41][42]. - The top 10 companies now account for 73% of the new value added in the market, indicating a shift towards larger, financially robust firms [41][42]. - The ongoing market downturn is likely to further consolidate the industry, with smaller firms facing increasing challenges to survive due to insufficient land acquisition [42].

Core Insights - The "Influence Index 2025 Boao Style Performance" event recognizes exemplary forces in various industries on the path to high-quality development [1] - The past year has seen significant trends in cross-industry integration, reshaping industrial structures and social life through resource sharing and complementary advantages [1] - Companies are actively exploring integration paths and embracing cross-border cooperation to innovate and create competitive new models and products [1] Industry Trends - The trend of cross-industry collaboration is breaking traditional barriers, leading to substantial potential through shared resources and innovative business models [1] - The development of diverse business formats is driven by innovation, expanding market boundaries to meet increasingly diverse consumer demands [1] - The vigorous growth of multi-faceted business formats not only provides new growth points for companies but also reshapes industry ecosystems towards higher quality and sustainability [1] Event Highlights - The "Influence Index 2025 Boao Style Performance" ceremony, hosted by the Viewpoint Agency, gathered industry elites to witness the limitless possibilities of integrated development [1] - Various awards were presented, including categories for influential commercial properties, logistics projects, and sustainable business initiatives [6][7][9][12][29]

Summary of China Resources Land Conference Call Company Overview - **Company**: China Resources Land (CR Land) - **Industry**: Real Estate Development in China Key Points and Arguments Business Model Transformation - CR Land is undergoing a five-stage business model transformation due to a shrinking new home market and the development of public and private REITs [2][3] - **Stage 1**: Increasing earnings from recurring income business, expected to rise from 41% in 2024 to over 50% by 2029 [12] - **Stage 2**: More assets to be spun off to REITs, with 80% of malls in tier 1-2 cities available for spin-off, estimated at Rmb256 billion NAV [15] - **Stage 3**: Reduced capital redeployment into development property (DP) business due to declining new home sales [20] - **Stage 4**: Potential change in dividend policy from a percentage of earnings to absolute DPS, enhancing dividend visibility [24][25] - **Stage 5**: Evolving into asset management and investment management, similar to Link REIT and Goodman fund models [29][31] Valuation and Market Position - CR Land is trading at a 50% discount to NAV and 8.1x 2026E PE, indicating it is underappreciated by the market [1][8] - Price target raised by 14% from HK$37.00 to HK$42.00, based on a 36% discount to SOTP-based 2026E NAV [4][40] - Compared to peers, CR Land's 2026E dividend yield is 4.6%, higher than the sector average of 3.0% [4][42] Financial Projections - **Revenue Growth**: Expected revenues to increase from Rmb207,061 million in 2022 to Rmb251,137 million in 2023 [5] - **Net Earnings**: Projected net earnings to remain stable around Rmb27,000 million in 2022 and Rmb27,770 million in 2023 [5] - **DPS**: Expected to be Rmb1.40 in 2022, increasing to Rmb1.44 in 2023 [5] Investment Opportunities - The transformation creates uncertainty, which may present investment opportunities if CR Land follows a positive development path [3] - The potential cancellation of the presale system could further reduce capital needs in the DP business, allowing for more capital allocation towards dividends [20] Risks and Considerations - The ongoing downcycle in the residential property market may continue to affect investor sentiment towards CR Land [8] - The company’s reliance on the DP business, which only accounts for 21% of NAV, raises concerns about capital deployment in this segment [8] Additional Insights - CR Land's dividend policy currently stands at 37% of core earnings, with a significant portion generated from the DP business [8][26] - The company has plans to spin off additional assets to public REITs, enhancing capital recycling and supporting core earnings growth [15][11] Conclusion - CR Land is positioned for a significant transformation that could unlock value through strategic asset management and a shift in dividend policy. The current market undervaluation presents potential investment opportunities, contingent on successful execution of its business model transformation.

地块位置 | 深圳公共资源交易中心 8月15日下午，深圳宝安区新安街道A002—0108宗地经过187轮激烈竞价，最终由招商蛇口+华润置地联合体以总价86.4亿元、楼面价5.96万元/平方米、溢 价率34.81%竞得。 该地块不仅成为深圳市宝安区最贵的居住用地，也是今年以来深圳土拍市场成交总价最高的宅地，并刷新了宝安中心板块楼面价纪录。 | | 【深圳】8月15日土拍结果 | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 宗地号 | 建设用地面 规划建筑面 地块位置 | | 容积率 | 用地 | 起始价 | 成交总价 | 成交楼面价 | 溢价率 | 竟得人 | | | 积(m') | 积(m') | | 性质 | (万元) | (万元) | (元/m') | | | | | 宝安区新安街道甲岸 | CKET | | | | | | | 深圳市招顺置业有限公司 | | A002-0108 | 南路与金科路交叉口 42521.94 | 145000 | 3.41 | 住宅用地 | 640900 | 8 ...

Investment Rating - The report maintains a "Positive" rating for the real estate and property management sectors [2][3]. Core Insights - The report indicates that the broad housing demand in China has likely bottomed out, although the volume and price have not yet entered a positive cycle. It anticipates that the overall real estate market will continue to stabilize, with further policies expected to be introduced to support this trend. Core cities are expected to lead the recovery as they approach the bottom of the market [3][34]. - The report highlights significant policy changes, including the implementation of new regulations in Beijing that have led to a 20% increase in new home visits in areas outside the Fifth Ring Road. Additionally, various provinces are focusing on stabilizing the housing market and urban renewal tasks [3][34]. Industry Data Summary New Home Transaction Volume - In the week of August 9-15, 2025, new home transactions in 34 cities totaled 1.613 million square meters, a decrease of 9% week-on-week. The transaction volume for first and second-tier cities fell by 7.9%, while third and fourth-tier cities saw a decline of 23.5% [3][4]. - Year-on-year, new home transactions in August (up to August 15) decreased by 19.1%, with first and second-tier cities down by 17.6% and third and fourth-tier cities down by 35.5% [3][7]. Second-Hand Home Transaction Volume - In the week of August 9-15, 2025, second-hand home transactions in 13 cities totaled 999,000 square meters, a decrease of 3.6% week-on-week. Cumulatively, transactions in August were down 3% year-on-year [3][13]. Inventory and Supply - In the week of August 9-15, 2025, 76,000 square meters of new homes were launched in 15 cities, with a transaction volume of 65,000 square meters, resulting in a transaction-to-launch ratio of 0.86. The total available residential area in these cities was 89.15 million square meters, reflecting a slight increase of 0.1% [3][24]. Policy and News Tracking - The report notes that the National Bureau of Statistics reported a 12% year-on-year decline in real estate development investment for the first seven months of 2025, totaling 535.8 billion yuan. Various provinces are implementing measures to stabilize the housing market and promote urban renewal [3][34]. - Specific policies include a reduction in the down payment ratio for housing loans in Suzhou to 15% and the introduction of new measures to support the conversion of commercial properties to residential use in Shanghai [3][34]. Company Dynamics - Several real estate companies reported their sales figures for the first seven months of 2025, with China Resources Land at 123.6 billion yuan (-11.8%) and China Jinmao at 61.8 billion yuan (+23.0%). Dragon Lake Group forecasted a 70% decline in core earnings [3][34]. - Financing activities included the issuance of bonds by various companies, such as a 1.5 billion yuan medium-term note by Dayuecheng Holdings and a total of 1.4 billion yuan in bonds by Yuexiu Property [3][34].

Investment Rating - The report maintains a recommendation for the real estate industry, indicating a cautious but potential investment opportunity as the sector adjusts to current market conditions [3]. Core Insights - The real estate market is experiencing a "W-shaped" bottoming process, with new construction expected to show a trend of rising and then falling in the second half of the year, with the peak likely approaching zero growth [2][39]. - The overall development investment is under pressure, with July's investment amount showing a year-on-year decline of 17.0%, reflecting weaker construction intensity due to declining sales market heat [2][38]. - The funding chain index for the real estate sector has slightly improved but remains at historically low levels, indicating potential future improvements in the financial situation of some companies [2][10]. Summary by Sections Sales and Construction Data - In July, the adjusted year-on-year growth rate for new housing sales area was -7.8%, continuing a trend of low market activity since May [13][14]. - The total sales area for the first seven months of 2025 was 515.6 million square meters, with a cumulative year-on-year decline of 4.0% [9][14]. - The new construction area in July saw a year-on-year decline of 15.4%, with a cumulative decline of 19.4% for the first seven months [2][39]. Price Trends - The new home price index for 70 cities showed a month-on-month decline of 0.31% in July, with significant drops in second-tier cities [10][11]. - The average price of new homes in July was 9,613 yuan per square meter, reflecting a year-on-year decrease of 2.6% [12][14]. Investment Recommendations - The report suggests that the narrowing gap between net rental yields and mortgage rates is a key observation point for total demand in both new and second-hand housing markets [37]. - It emphasizes the importance of focusing on companies with stable cash flow generation capabilities, such as China Overseas Development and Poly Developments, as potential investment opportunities [37][38].