Core Viewpoint - New World Development has achieved remarkable sales results in various projects in mainland China and Hong Kong at the beginning of the new fiscal year, steadily accelerating cash flow and actively promoting residential project deliveries [1][2][3] Group 1: Mainland Business Performance - Several projects are leading the regional market, with two benchmark projects successfully delivered, including Shanghai Tianhui Xi and Guangzhou Yaosheng New World Plaza [1] - Guangzhou Yaosheng Zunfu has launched the second phase of distinctive units, with areas ranging from approximately 88 to 245 square meters, while Guangzhou New World Guanghui Zunfu has launched duplex units ranging from 92 to 125 square meters [1] - Shenzhen K11 ECOAST has attracted nearly 20 new brands through summer activities, enhancing its business offerings [1] - Shanghai K11 ELYSEA and Ningbo THE PARK by K11 Select have won gold awards at the BETTER FUTURE Hong Kong Design Awards 2025 in their respective categories [1] Group 2: Hong Kong Business Performance - The first round of sales for the South Island Phase 5 "DEEP WATER PAVILIA滶晨II" saw 82 out of 88 units sold, with total sales reaching nearly 8.8 billion HKD as of July 30 [2] - The new landmark luxury residence "THE PAVILIA FOREST柏蔚森" has sold over 600 units, generating sales exceeding 4.2 billion HKD, with the first delivery of units starting in September [2] - The luxury project "STATE PAVILIA皇都" has sold out all "皇都维港珍藏大宅" units, with an average price close to 40 million HKD [2] Group 3: Future Outlook - With ongoing business development and more new projects entering the market, New World is expected to see further performance progress in the new fiscal year [3] - The continuous launch of "滶晨II" and "THE PAVILIA FOREST柏蔚森" in the Hong Kong market is anticipated to maintain recent market momentum [3] - In the mainland market, projects in Guangzhou and Shenyang are continuing their strong sales momentum, with the first K11 Select project in Guangzhou set to debut [3] - The company will continue to adhere to a high-quality development strategy, focusing on its core business and pursuing stable growth in performance [3]

Core Insights - In the first half of 2025, over 120 centralized commercial projects were opened nationwide, indicating a shift towards cautious and steady operations rather than rapid expansion [2][4][6] - The proportion of projects involving stock renovation has increased, with over 30% of new openings being renovations, highlighting a trend towards urban renewal and revitalization of existing assets [6][17] - The emergence of new commercial models such as outlet malls, themed malls, and hybrid commercial spaces is becoming a key strategy for differentiation in a competitive market [19][20] Group 1: New Openings and Market Trends - A total of 120+ centralized commercial projects were opened in the first half of 2025, covering approximately 9 million square meters [2] - The opening peaks occurred in January and May, with 46 and 38 projects respectively, while February saw only one opening due to the Spring Festival [2] - The structure of new openings has shifted, with a 70:30 ratio of new projects to stock renovation projects, and in June, the renovation projects surpassed new openings for the first time [6] Group 2: Regional Distribution and City Performance - The East China region led in new openings, accounting for 34% of the total, followed by South China and Southwest China at 19% and 15% respectively [7][8] - Beijing ranked first in the number of new openings, with 8 projects, while several lower-tier cities also showed significant activity [10][12] - High-tier cities continue to dominate the commercial landscape, but lower-tier cities are increasingly active, with notable openings in fourth and fifth-tier cities [12] Group 3: Leading Companies and Market Dynamics - Sixteen companies opened two or more projects, totaling 43 projects, with Zhuhai Wanda Commercial Management leading with 8 new openings [14] - State-owned enterprise Beijing Xincheng Commercial emerged as a "new dark horse," focusing on stock renovation projects [14][15] - Companies are increasingly utilizing stock renovation as a key strategy for project expansion, with several major players launching new product lines and flagship projects [15] Group 4: Urban Renewal and Stock Renovation - Urban renewal is driving the revitalization of commercial spaces, with nearly 40 stock renovation projects opened in the first half of 2025 [17][18] - The focus of renovations includes transforming old department stores and supermarkets, as well as repurposing vacant properties and historical sites [17][18] - Innovative commercial formats are emerging from urban renewal efforts, such as immersive industrial-style districts and cultural tourism landmarks [18] Group 5: Differentiation Strategies in Commercial Development - Outlet malls are experiencing a counter-cyclical boom, with 9 new outlet projects opened, reflecting a shift towards quality discount retail [19] - Themed malls targeting specific consumer segments, such as female-focused and esports-themed malls, are gaining traction [20] - Hybrid commercial spaces that integrate various elements like parks, art, and cultural heritage are being developed, providing new avenues for consumer engagement [20]

Group 1 - New World Development Company Limited has reached a new bank financing and unified bank financing agreement covering approximately HKD 88.2 billion of existing unsecured financial debt [1] - The company's financial management strategy focuses on reducing liabilities and improving cash flow, while continuing to fulfill existing financial responsibilities [1] - The recovery of the real estate market in Hong Kong and mainland China, along with the growth in demand for high-end residential properties, has led to the successful launch of several "phenomenal" hot-selling projects [1] Group 2 - As of June 25, the company has achieved its contract sales target of HKD 26 billion for the fiscal year 2024/2025 [1] - In the mainland market, projects in Guangzhou and Shenyang have led sales, with Shenyang's project topping the residential sales chart in May [1] - In Hong Kong, the super luxury project "滶晨" has sold over 330 units at a maximum price of over HKD 538,000 per square meter, attracting both local and overseas buyers [2]

Core Viewpoint - K11 ECOAST, a flagship project by K11 Group in Shenzhen, has faced significant public criticism since its soft opening on April 28, 2023, due to experience gaps, leasing controversies, and operational flaws despite being heavily invested in and anticipated as a cultural retail landmark in the Greater Bay Area [1][6][22]. Summary by Sections Project Overview - K11 ECOAST is positioned as a cultural retail landmark in the Greater Bay Area, with an investment of over 10 billion and seven years of development [1]. - The project spans over 220,000 square meters and is strategically located near the Shekou Cruise Homeport and Sea World [22][24]. Consumer Feedback - Many consumers expressed disappointment, stating that the experience did not meet their high expectations, with comments highlighting a lack of shopping and dining options [6][16]. - A resident noted that while the scenery is beautiful, the shopping and dining experiences were underwhelming, leading them to prefer nearby commercial centers [6][18]. Operational Challenges - The soft opening was described as rushed, with inadequate preparation leading to complaints about cleanliness, lighting, and restroom facilities [9][26]. - The layout and directional signage within the complex were criticized for being confusing, with many visitors unsure of how to navigate the space [13][20]. Brand and Leasing Status - The occupancy rate of K11 ECOAST is reported to be below 50%, with many anticipated high-end brands not yet present, leading to a perception of limited shopping options [20][21]. - Current tenants include more mainstream brands like Muji and Fei Dazhu, rather than the luxury brands initially promised [20][21]. Future Developments - K11 ECOAST is still in its initial trial operation phase, with plans for additional brand openings in the coming months and a second phase set to launch in 2026 [27]. - Despite the criticisms, the project has seen daily foot traffic exceeding 100,000, indicating a strong initial interest from the public [26][27].