Core Viewpoint - New World Development has reported a solid performance for the fiscal year 2025, achieving a core operating profit of HKD 6 billion and setting a sales target of HKD 27 billion for fiscal year 2026, indicating a positive outlook for the company's financial health and operational efficiency [1] Financial Performance - The company successfully completed bank refinancing of HKD 88.2 billion, extending the maturity of bank loans to June 30, 2028, which significantly enhances liquidity [2] - Average interest rates and total financing costs have decreased due to interest rate cuts in the US and Hong Kong, alongside a reduction in debt levels [2] - Capital expenditures (CAPEX) decreased by 15% year-on-year, while operating expenditures (OPEX) fell by 16%, reflecting improved operational efficiency [2] Real Estate Business - The core real estate business performed strongly, achieving contract sales of HKD 26 billion, with contributions of HKD 11 billion from Hong Kong and RMB 14 billion from mainland China [3] - Notable projects include the "滶晨" project in Hong Kong, which achieved sales of over HKD 10.7 billion, and the "广粤观邸" project in Guangzhou, which sold RMB 2 billion on opening day [3] Future Development Plans - The company has a robust land bank and plans to launch over 2,100 units in Hong Kong for fiscal year 2026, including projects in Kowloon City and West Kowloon [4] - Collaborative projects with partners such as China Merchants Shekou and China Resources Land are underway, aiming to provide thousands of residential units [4] - The investment property segment is also set for expansion, with new K11 projects opening in Guangzhou and Shanghai, contributing to future revenue growth [4]

Core Insights - Shenzhen is experiencing a surge in the opening of commercial complexes, with 8 already opened and 19 more expected by the end of the year, making it the city with the highest commercial density in China [1][9] - New commercial complexes are attracting significant foot traffic, with Shenzhen Dayuecheng drawing 420,000 visitors on its opening day, surpassing previous records [2][3] - Established commercial projects in Shenzhen continue to outperform new entrants in terms of profitability, with the top five complexes generating sales exceeding 5 billion yuan each [1][6] Group 1: New Commercial Complexes - New commercial complexes are breaking traditional shopping center models by focusing on immersive experiences and unique environments, such as Shenzhen Dayuecheng's curated spaces and K11 ECOAST's integration of art and commerce [3][4] - The introduction of differentiated retail experiences is key, with K11 ECOAST featuring unique attractions like the first NBA-themed venue in Shenzhen and various immersive art installations [3][4] - New complexes are also focusing on specific target demographics, such as families and young consumers, to enhance customer engagement and loyalty [5][10] Group 2: Established Commercial Complexes - Established complexes like Shenzhen MixC and Qianhai Yifang City have maintained strong revenue streams due to their competitive product offerings and brand partnerships [6][7] - These older projects leverage their long-standing brand recognition and customer loyalty to attract high-spending consumers, with average customer spending exceeding 500 yuan [8][11] - The ability to adapt to changing consumer demands and enhance the shopping experience through innovative offerings is crucial for the success of these established complexes [7][8] Group 3: Future Trends and Challenges - Upcoming projects, including community-based commercial complexes and those integrated with public transport, are expected to cater to local consumer needs and enhance foot traffic [9][10] - The commercial landscape in Shenzhen is evolving, with a focus on filling gaps in regional market offerings and addressing the needs of specific consumer segments [10][11] - Challenges remain, including land scarcity and the need for collaboration among developers, operators, and brands to create successful commercial ecosystems [11]

Market Overview - In July, Hong Kong's new property market remained active with over 2,000 transactions, representing a month-on-month increase of over 30% [2] - New World Development reported strong business momentum at the beginning of the new fiscal year, with excellent sales results from various projects in mainland China and Hong Kong, leading to steady cash flow [2] Mainland Business - The high-end residential project Tianhui Xi in Shanghai successfully delivered all 448 units, selling out after two rounds of sales [5] - In Guangzhou, the new landmark project Yaosheng New World Plaza is delivering residential, commercial, and Grade A office spaces, showcasing New World's strong delivery capabilities [5] - The K11 ECOAST in Shenzhen launched multiple summer activities and added nearly 20 new brands, enhancing tenant diversity and customer experience [5] Awards and Recognition - Shanghai K11 ELYSEA and Ningbo THEPARK by K11Select won multiple awards at the BETTER FUTURE Hong Kong Design Awards 2025 for their architectural excellence [6] - New World Development's sustainability efforts were recognized with awards for the Hangzhou New World City Art Center and the "2030+ Sustainable Development Vision" [6] Hong Kong Business - The luxury residential project DEEP WATER PAVILIA滶晨II in Hong Kong sold 82 out of 88 units in its first round, achieving a sales rate of 93% [8] - The new landmark luxury residential project 柏蔚森 in Kai Tak has sold over 600 units since its launch, generating over HKD 4.2 billion in sales [9] - The core cultural landmark luxury project STATE PAVILIA皇都 sold out all units in the "皇都维港珍藏大宅" series, with an average price of nearly HKD 40 million [9] Events and Promotions - New World Development hosted two major international events at K11 MUSEA during the summer, including the "CHIIKAWA DAYS" exhibition and the CR7® LIFE Museum, attracting significant visitor traffic [10]

Core Insights - Shenzhen's first Joy City opened on July 12, marking a significant addition to the commercial landscape of the Guangdong-Hong Kong-Macau Greater Bay Area after 15 years of development and multiple delays [1] - The opening day saw over 420,000 visitors and nearly 20 million yuan in sales, with many brands achieving national and local sales championships [1][3] - The commercial environment in Shenzhen is highly competitive, with 21 new projects expected to open by 2025, adding a total of 1.8625 million square meters of commercial space [1] Group 1: Commercial Performance - Shenzhen Joy City attracted over 420,000 visitors on its opening day, generating sales close to 20 million yuan, excluding Apple and automotive sales [1] - Nearly 100 brands achieved national sales champions, and around 50 brands topped sales in Shenzhen [1] - The shopping center features over 400 quality brands, with more than 50% being first stores and customized stores, focusing on trends like family, trendy toys, and pet economy [3] Group 2: Innovative Offerings - The shopping center includes unique spaces such as an open-style trendy cross street, a 4,000 square meter rooftop garden, and a 30,000 square meter "underground city" [6] - The center hosts several themed pop-up stores, including Disney's Toy Story and other popular IPs, enhancing the social and experiential aspects of shopping [6][7] - The introduction of a Hema Fresh store, which is the first hot pot experience center in the nation, showcases innovative retail strategies [3] Group 3: Competitive Landscape - The commercial real estate market in Shenzhen is intensifying, particularly in Bao'an District, which is projected to have nearly 40 commercial complexes by 2024, totaling over 3.1 million square meters [10] - Major competitors include local developers like Hongrongyuan and established brands like K11, which have been expanding their presence in the region [10][11] - The increasing number of commercial complexes necessitates differentiation through effective brand attraction and a well-curated mix of retail offerings [11]

Core Viewpoint - Shenzhen's first Joy City officially opened on July 12, 2023, after 15 years of development and multiple delays, attracting significant consumer interest and sales on its opening day [1][5]. Group 1: Opening Day Performance - On its opening day, Shenzhen Joy City attracted over 420,000 visitors and achieved nearly 20 million yuan in sales [2]. - The project has a total area exceeding 730,000 square meters, with the shopping center covering approximately 250,000 square meters [5]. Group 2: Market Positioning and Competition - Shenzhen's diverse consumer base includes trend-seeking youth and quality-focused middle-to-high-income groups, leading to different strategies between northern and southern commercial entities [2]. - Northern commercial entities, like Joy City, typically leverage first-store economies and IP events to attract younger consumers, while southern counterparts focus on art exhibitions and immersive experiences to draw high-end clientele [2][10]. Group 3: Development Challenges - The development of Shenzhen Joy City faced significant challenges, including a 7-year negotiation for land acquisition and a lengthy demolition process, with the first phase completed in 2019 [5]. - The project was initiated in 2010 through a framework agreement with the Shenzhen Bao'an District government [5]. Group 4: Future Prospects and Expansion - By the end of 2024, Joy City plans to have 44 commercial projects in China, with 30 being heavy asset projects and 14 light asset projects, totaling a commercial area of 3.75 million square meters [7]. - The opening of Shenzhen Joy City is part of a broader trend, with multiple commercial projects, including K11 and other shopping centers, launching in Shenzhen this year [9]. Group 5: Market Dynamics - The commercial landscape in Shenzhen is becoming increasingly competitive, with nearly 40 commercial complexes in Bao'an District alone, totaling over 3.1 million square meters [9]. - The differentiation in commercial strategies between northern and southern entities reflects deeper corporate philosophies and market approaches [10][12].