China Real Estate Editorial: state-owned enterprises as the reasons for not looting of public resources

Two state-owned real estate company has been a very eye-catching, they have a common interest demands – filling the Gailou.
Gold standard of the building has its construction of a unit by the China Bureau (Group) Investment Co., Ltd. and Hong Kong SuiFeng strong combination in the construction of a joint venture SuiFeng lasted 5 years hard development, dry is a shaking of the intention event – Rewriting “love affair” the most romantic words that the Chinese nation, filled Valentine’s Erhai Lake Villa to sell. Since the villa in the moon is more romantic than a lake full moon, our idiom dictionary, perhaps the emergence of such a term: “Wind Flower Snow villa.”

If the media reveal this scene, I believe that Dali municipal government will not recognize irregularities in the project, compared to East Lake in Wuhan seemed “lucky” more.
OCT same glittering signs its lead to trouble is the history of East Lake has been fishing 59 years, 109 workers have completed the demolition, but “Die Zeit” of a report for the incident swift spread throughout the country, OCT The reaction is denial, and the re-commitment “does not change an inch of East Lake shore line, do not take up an inch of Donghu lake.”

Some lakes have been filled in, and some lakes may not be filled, no intention to go explore them in this whole story, but the need for all people, need government vigilance of state enterprises into profitable real estate industry to compete in the market understandable However, if the influence of its powerful executive invasion looting of public resources while seeking profits, would necessarily lead to social imbalance of resources and fair criteria.

In accordance with the definition of state-owned enterprises, state-owned funds and resources for the state, the State should conduct its business for more answerable to the people. In line with this principle, the same state-owned enterprise, as the main market of the most active options more profits to the industry was not wrong. However, the community and the people most worried about, not the state-owned enterprises with lower financing costs and increased cash flow, but the background of state-owned enterprises due to its inherent advantages and ability to create administrative intervention.

To Erhai day domain, for example, the former Ministry of Construction in 2006, the Office issued the “investigation and handling of the immediate halt and Dali attractions of the region’s business development and construction of acts of notice”, the progress of the project remains; 2007, Dali City stop below the Dali Haidong Area East Coast international ecological garden project, but the domain remains intact Erhai days, this can not but imagination. For OCT the project in Wuhan, according to news media reports, the land cost is only 1.36 million yuan per mu, “to make Wuhan the envy of the industry,” while many land-related, had been cast and the Metro Group, Wuhan City, the construction project funding balance land, OCT As the bargaining power of the super central enterprises is evident.

Has a strong “anti-interference ability” and “bargaining power”, a large state-owned enterprises in obtaining huge profits, has reason to protect the ecological environment for the benefit of local people to afford more responsibility. But if some companies with their own strengths, to seize the public interest should belong to the people, to create so-called “giants nobles exclusive quality”, not only deviates from its corporate mission, are fundamentally contrary to the intention of the government is our livelihood and Tuidong the original intention of the urbanization process. Chinese people today may lose Erhai Lake, East Lake, tomorrow it may lose the West Lake, South Lake, Songhua, the wind does not stop, how to deal with public opinion?

Well as the fast: China’s apparent first-tier cities bubble

China Real Estate News,
Liu Xiaochen reporting from Beijing

April 26, China released in Beijing American Chamber of Commerce in 2010, “U.S. companies in China” White Paper. White Paper shows that U.S. companies generally believe that China remains the bright spot in the global economy, of which 79% of the respondents said their companies would expand investment in China in 2010. Well as the fast, president of American Chamber of Commerce for foreign investment, and property tax and other issues accepted the reporter an exclusive interview.

China Real Estate News: Over the past year, U.S. companies invest in real estate in China, how? What do you think the current Chinese real estate market?

Well as the fast: Overall, the majority of foreign real estate investors are concerned about China’s first line of the real estate market. But the present situation, the Chinese first-tier cities in the prices a bit high, it is obvious there are some asset bubbles. We also note that the Chinese government has started to take measures to reduce the price, I think this is a good thing, by reducing market volatility and curb speculative investment in purchase of such policies will help stabilize the market. We believe that the Chinese government will strive to implement various measures to maintain stable real estate market, to encourage real estate investment and to prevent the bubble, but this is Jin Nianlai other countries, the causes of economic crisis emerged.

China Real Estate News: At present, the Chinese real estate market is very controversial property tax levy, and that the United States has had a relatively mature experience, do you think at this stage in China, the feasibility of the implementation of how much property tax?

Well as the fast: In the U.S., state and local governments have the power to levy property tax. In fact, China’s problem is that local government own revenue is inadequate, not enough, but on the other hand, China’s real estate market now has a lot of hot money in which to control these speculative investments and one of the ways the local government tax revenue is to levy the property tax. Of course, there are simpler methods, such as the central government to local governments as part of the tax multisection. In fact, the issue of levying property tax, depending on the central government to achieve what is the purpose, the property tax on the overall market and what impact, which impact on the bank there. Therefore, the central government is concerned, all factors must be taken into account interests of all parties to reach a balance point, is a mature policy.

China Real Estate News: Foreign investment in Chinese real estate market has high barriers to market access, this, the Chinese government to foreign companies looking forward to how the policy environment?

Well as the fast: We also hope that the Chinese government can set low market entry threshold, allowing foreign investors to play a more active role in promoting the Chinese Government to abolish restrictions on market access, especially the “on Regulating Foreign Investment in Real Estate Market view “of the requirements for foreign companies to streamline the approval process, promote the establishment of a sustainable, mature real estate market.

We recommend a national real estate and related mortgage property rights registration and filing system, and related implementation measures introduced to ensure consistency in the implementation of get around. This is not only good for real estate to foreign investors, domestic investors also benefit real estate. Existing property rights registration system and the priority of security rights provisions are vague, inconsistent implementation across the country, and the limited accuracy of the information provided. American Chamber of Commerce to encourage the implementation of a unified national registration system, can improve the laws and regulations in various provinces and local implementation and the consistency and transparency of property registration in order to improve urban planning, real estate transactions to improve efficiency and improve the construction and quality standards.

On his
60% and 7.5 trillion

Ping Xu from the China Real Estate

China Banking Regulatory Commission seems to be the leading property market regulation. CBRC Chairman Liu Mingkang recently on the “down payment Liu Cheng,” The remarks caused an uproar. If we carefully look at the CBRC to clarify the subsequent presentation, we actually discovered that the previous policy, but was re-declared it.

In the same occasion, Liu there is another position that year was 7.5 trillion yuan of new loans, this indicator is not new, because this is year two of the country the government work report on the identification of down, but this an indicator and the “down payment Liu Cheng,” put together, there will be a fun.

We assume that the CBRC is really mandatory for all “two suites down payment to Liu Cheng,” above, then the commercial banks in China this year could be 7.5 trillion out of total loans is a problem. In the author’s forthright views, down payment mortgage Liu Cheng will support the property market weakened demand for leverage, 7.5 trillion credit line is not completed. The Case of Shanghai, a quarter of new lending, and half of the flock to real estate, indicating that commercial banks and real estate industry is a two-way dependence.

On the other hand, the 7.5 trillion so relaxed policy environment, there are few banks willing to put two suites down payment raised to Liu Cheng and beyond it? We do not know how the target 7.5 trillion cut to the banks, but one thing is certain, cutting credit lines can be divided, but the credit markets, “high-quality customer resources” is not cut by regulators, the commercial banks only himself to compete, competition, magic weapons, is to reduce the down payment percentage. For the banks, the amount 7.5 trillion this year, that is, the coupons valid for one year, or take out a little bit more than others to make a little extra, because the market risk are similar for all of us.

So from further credit to curb property prices rose, or really the latest requirements by the State Council to continue to improve across the board two sets and a number of suites down payment percentage, or compress the overall credit scale this year. The latter is almost impossible, because this is the end of last year’s central economic work conference and this year’s government work report set out two plates.

The former is a choice, that is “differentiated” in real estate lending policies. In fact, real estate, “differentiated credit policy” framework is ready: the policy requires commercial banks and a number of suites will be two sets down payment loans to upgrade Daowu Cheng, Liu Cheng and even seven or eight percent. The reason fail to contain the effect of price increase, but overestimated the risk of commercial banks in the market sense of, or underestimate its profits and market share in the temptation.

Therefore, the future “differentiated credit policy”, based on the bank of the market risk of self-judgment, property prices, or even embarrassing situation. The “differentiated credit policy” Once lost flexibility, as every household bank must comply with the rules and prohibitions, who do not know what is the extent that risk.

Relying on transfer from the various farms and ternary Group real estate asset base and lay the first agricultural groups to undertake a large number of real estate resources. When we find an agricultural processing enterprises a unique path in real estate after a problem has cropped up: whether to develop its land for agricultural land for real estate development?

The first agricultural real estate Pursuit Group

China Real Estate News,
Su Chun-Mei Yang Fan trainee journalist
Beijing reports

Behind a dairy enterprise, looms a huge real estate assets “of a treasure map.”
Within a month of continuous release of two to encroach the notice of real estate so that people are focusing on the Beijing Sanyuan Co., Ltd. (triple share, 600429.SH) body.

April 10, announced that it will participate in the Beijing Sanyuan shares Yinghai Town, Daxing District, an industrial base of industrial land in the auction; Previously, the company also decided to triple its stake in the Beijing Real Estate Development Co., Ltd Devon capital increase.

At the press survey, triple share and controlling shareholder of Capital Agricultural Holdings (the “First Agricultural Group”) and huge amount of real estate assets stealth profile up slowly. For nearly 20 years, through several levels of complexity, a subsidiary, the first agricultural groups not only participate in the capital several well-known real estate project development, the hands hold a large number of hotels, apartments, office buildings and other holding properties, and also involved in the Among industrial park development. In the property involved in a long time, the business covers the breadth of amazing.

Even more remarkable is that the increasing scarcity of land resources in Beijing, the first agricultural groups through holding 10 Yu Jianong field have a lot of “raw land”, with many in the hot zone.

Tailored block

Yinghai Town, Daxing District, on the participation of industrial land in the auction industry base, in fact, triple share and Daxing District Government has the agreement to invest about 6.8 billion to build here daily processing capacity of 1,200 tons of fresh milk industrial park.

It is understood that it will participate in bidding in the D10-2 land planning construction area of about 71,000 square meters with a starting price of 63.24 million yuan. Land transfer sector bidders eligibility requirements include “the introduction of dairy production and processing projects,” “the past two years because of food quality is not affected by food regulatory agency Punishment,” “more than 60% use local milk,” and so on.

“Tailor-made.” Industry insiders, “It is no suspense in a bid.” A dairy industry analyst briefing, the park is completed, the shares will triple in Beijing Xi’erqi of the main plant and several other plants in urban areas to move out. He speculated that the resulting vacant industrial land may be used as a real estate development.

Three shares, but a staff member said that the management has not yet heard of such a decision.
Although the Proton can not be identified out of the land temporarily for the purpose of real estate development, but the other actions are revealed and the first agricultural groups ternary shares of real estate scheme.
March 17, triple share and Beijing Dongfeng Agriculture, announced the company, the southern suburbs of Beijing together on the farm in cash for real estate companies with triple the proportion of capital increase, Devon. The actual control of three companies per capita agricultural groups led.

Three Devon was established in 2005, business scope, including real estate development, commercial housing sales and property management. After the capital increase its registered capital from 10 million yuan to 50 million yuan. The three companies, the rates were 20%, 51%, 29%.

Analysts believe that the capital increase that the first agricultural groups to expand the capital market with the help of more profitable real estate business intentions, these triple the staff shares that currently can not reveal the three yuan capital increase of the movement, Devon, has not disclosed its future possible development projects.

Three groups of assets to undertake

A dairy industry company, why have deep plowing real estate? Coincidence or a necessity?
“Three of shares and the first agricultural groups is Beijing’s very competitive real estate developer.” Said one of the real estate sector.
But the more people do not know the specific circumstances of its real estate business. The number of reporters developers, real estate consultant agencies, industry, and said shares on the triple and the first real estate business without the knowledge of agricultural groups.

However, as the reporters in-depth investigation and found that the two actions relating to real estate is its many real estate movement in microcosm. Many have been deposited on the history.
The first agricultural group is the largest agricultural state-owned capital, is one of Beijing SASAC subordinates. In April 2009 by the Sanyuan Group, Waldorf Group, made big fat livestock corporate restructuring. Total assets of 15 billion yuan after the reorganization, a wholly-owned and state holding enterprises 64, 26 in joint ventures, foreign companies 2; including triple share listed companies.

According to incomplete statistics, at least the business more than 20 businesses involved in real estate, and the vast majority of them belong to triple the original group. In other words, today’s first Group huge amount of real estate assets in agriculture, almost all from the Group Three previous operations. These assets consist of residential properties and industrial parks holding class projects (see table left).

To residential development, for example, since the 80s of last century, the triple Group has been involved in residential development. Visible information, the Three Group involved in dozens of residential projects have reached many, many of whom are Huilongguan Cultural Residential Area, Dongshan villa, Xi’erqi public rental housing projects more representative of the residential project.

In addition, holding properties, the ternary groups are “wading” darker earlier, they hold an apartment in Beijing Chaoyang Foreign apartment early one, the number of foreign holdings of international apartment is relatively well-known, same time, more than triple the Group also owns hotel properties, as well as hundreds of thousands of square meters of office space.

Varco International Property Consultants Rice (Beijing) Co., Ltd. Deputy General Manager Ho Feng description, type of property held in Beijing markets, foreign apartments has always been the highest yielding, most stable type of income. At the same time in the hotel property, in addition to five-star hotel, the yield is the highest three-star hotels and economy hotels.

This means that the first group of existing agricultural holding properties can bring a lot of stability for the company’s cash flow, while groups can reap the benefits of property value.
Strengths and resources through agro-processing, the first agricultural groups also entered the field of industrial property, owns a single area in north China’s largest commercial retail distribution center, an area of 13 hectares, the project will be leased to the Group of poor quality. The farm also has a large number of holding area for lease of industrial park.

Stealth “landlord”

When a large number of real estate assets gradually emerges, this newspaper is more concerned about the real estate giant is the first agricultural groups formed?
Insider, because the subordinate enterprises, including more than ten large state-owned farms, the former Beijing Sanyuan Group once the big “landlord” one.
Three groups have sold a lot of places, but with the rise of real estate, which gradually involved in real estate development.
Was established in 2002 as its exclusive real estate holding company – in the case of ternary home on the site expressed their access path:
“Companies around 1985, use of land resources and geographic advantages of project development. From the land valued shares to operate independently. Product types include Need for affordable housing to luxury villas, from high-end commercial space to the exclusive private clubhouse. Operating in, formed property management, foreign apartments, sports and leisure, retail leasing for the chain on behalf of the business. “In fact, in 2006, Villa Park, an independent development project, all of the Group Three residential projects are cooperation with other developers, land is undoubtedly an important capital.

“In 2004, ’8 * 31 ‘to allow the agreement before the transfer that is exactly the mode of ternary groups such cooperation offers many facilities.” Hopefluent Beijing branch manager of Shang Wensheng said.

Information from public view, ternary Group holding company involved in the development of most projects focus on the 2001 to 2005 this time, since the development of the project are basically the farm in its sphere of influence.

For example, the Cannes villas are still available for sale items, their farm in the Double Bridge Web site describes the group wrote: “The Farm is rich in land resources, and development company called Beijing CBD to develop a back garden of the Cannes villa. “and their entry into office and industrial park would be more simple – after the removal of factories to the suburbs of the city, the Group’s real estate business development company to pay the cost of its demolition, in the urban area on the attribution to the original site development company holding properties of construction; farm or part of the plant ceases production tasks, build industrial parks for lease to “revitalize the assets.”

Variability of agricultural land?

The dairy industry analysts believe that, whether land or into the real estate development, with the original triple Group was the situation in the dairy industry.
Number of securities agency study shows that dairy products over the years although the ternary shares has been Beijing’s “boss”, but its growth capacity and profitability has been less peers. Slow growth in sales revenue over the years, gross margins well below the Mengniu, Yili. Limited room for growth, in Beijing has a lot of land resources has become inevitable Sanyuan Group to develop real estate.

Even if the melamine incident, triple share purchase Sanlu assets, but analysts say that, the dairy industry, the competitive landscape has not changed completely. While the acquisition of Sanlu, has led to triple sales of shares in 2009 advertising costs and greatly increased the amount of initial one-time investment, so the performance loss.

“This could also be the first after the reorganization of agricultural groups are willing to continue to be developed in the real estate business because, after all, to the Chinese re-group and big hair were the company’s main business of livestock agriculture and meat, the profit is room for improvement Restricted. “some analysts say.

Reorganization in March 2009 after the completion of the first agricultural groups are active in the real estate business: the completion of Dragon Crown in Huilongguan area home building, so holding properties increased 60 thousand square meters area; after Beijing won the first race 27 a public rental housing project development rights; completed the largest single distribution center in North China; promote the progress of a number of residential real estate projects … …

Moreover, the original Three groups the advantages of real estate business development – land resources, allocated to the first agricultural groups. The Group’s major land resources are still owned the farm from.
Agriculture Group’s first site inspection found that in nine farms, at least about 8.17 mu of land resources. And a considerable portion of the location of the farm just at the current residential, commercial real estate development hot spot location.

However, the newspaper of the land on these farms could turn into a real estate development and land skeptical.
“Can not say that this land must be denatured way breach.” A property consultants believe that: “the farm there are some agricultural land, there are industrial sites. From industrial sites into new industry development of industrial park land is no problem, and its to commercial land and residential land conversion, and the Beijing Urban Planning, the changes brought about, and then the land transfer policy. “” Although the farm of the land is agricultural land, but with the gradual adjustment of the Beijing Municipal Planning and its the nature of change is likely to land; and these farms belong to Beijing SASAC, the changing nature of state-owned agricultural land than the collective land easily. “Chinese Vice President HE Feng Gao Rice that.

However, some have suggested, according to existing regulations, state-owned agricultural land to be requisitioned before commercial or residential use. The first group may be one of agricultural land compensation, but after the completion of a land development and two development needs in the open market competition in a fair market environment, “the first of these opportunities may be nothing to do with the agricultural Group.”

And Sun Hung Kai “complementary” high-end items have been re-blitz
KWG to future performance, “paving the way”

China Real Estate to the military / text

March so far, and KWG Property Holding Limited (KWG, 1813.HK) have heard the good news. April 7, the company announced the result, including Guangzhou, Chengdu, Beijing and other major cities, strong sales in the first quarter sales amounted to 3.6 billion yuan, up significantly increased 5-fold.

Current performance in achieving the same time, KWG are actively looking for new opportunities. March 17, the company invested 1.63 billion yuan and that Sun Hung Kai Properties (00016.HK) set up the project company, to develop change for the project of Foshan. Will therefore increase the 560,000 square meters of quality land bank. This is the second time the two Hong Kong listed companies together. The last time cooperation is also highly competitive Liede old city reconstruction project. According to localization, the two co-operation “crystallization” are located in prime locations in the flagship city complex will KWG high-end integrated commercial real estate projects in the development of additional chips.

It is reported that some of Liede project will be sold to the market in the fourth quarter. The KWG will also begin to focus on the next round of push plate, the next two years will be launched in 5 cities in the country projects.

Once again join hands with Sun Hung Kai “complementary”

KWG cooperation with Sun Hung Kai “Foshan old change project” means Chancheng Lanshi transformation of the old one and the two plots, land exceeds 8.1 billion yuan, Sun Hung Kai Properties is investing in the Mainland is the largest single project .

By providing funds to 1.63 billion yuan and Sun Hung Kai set up the project company, KWG get 20% interest in the project, in addition, both parties need to pay according to their proportion of shareholder equity loans used for land acquisition cost of the two.

Foshan total construction area of over 2.8 million square meters, which means KWG would add another 560,000 square meters of land quality, land reserves exceed 7.5 million square meters total area.
According to the plan, the project will be hit for up to 10 million people create a new city, “Dongping Town.” As a large urban complex, living, working, playing full-featured, shopping, Central Park, residential communities, apartment and office building in which the ranging. The new landmark in the next 5 to 10 years to improve the appearance of Foshan, and become an important node in the same city Guang – Project is located in the Guangzhou-Foshan Subway extension line, Guangzhou, Shunde, Foshan, leading to even the Western Pearl River Delta gateway to the city.

“China’s cooperation with Sun Hung Kai Company and the Shareholders as a whole will benefit.” KWG, said that this is the group also participate in property development opportunities, Foshan, China’s cooperation with Sun Hung Kai will bring valuable experience and expertise.

In fact, this is the KWG and Double hand in hand with Sun Hung Kai, the last time cooperation is in the village of Guangzhou Pearl River New City Liede change for the project.
September 2007, KWG and R & F Properties to 4.6 billion yuan jointly won the Liede change for the village land, setting the auction in the history of Pearl River New City’s largest commercial land, the largest record of building area, and become involved in city real estate Nakamura transformation of the first breakthrough. Way to joining Sun Hung Kai shares then, three each holding 1 / 3 stake.

Liede total construction area of 570,000 square meters, total investment reached 10 billion yuan, the State Council approved major development in the central financial business areas – Pearl River New City axis. Foshan project with the same orientation as the urban complex, including the Grade A office space, together diverse brands famous shopping malls, as well as provide a comfortable and luxurious world-class hotels and service apartments.

Cooperation is seen as two of Sun Hung Kai and KWG’s “complementary”: SHK is to take part in reconstruction projects, master, and accumulated a lot of relevant experience, together Jingtai new city full of good project development experience and familiar with the Chinese mainland market . Therefore, complementary partnership will achieve one plus one is greater than two results.

High-end projects into the market, “paving the way for” future performance

Early efforts will be made gradually return. KWG held in the March 25 conference on the 2009 results revealed no change Liede village project will be the second half of the market, the first sale of a residential project.

Industry that are usually located in urban redevelopment projects downtown, the demand for high-quality property is very large, which reduces the company’s operational risk and costs. Meanwhile, the lot where such projects have very high appreciation potential.

“Then that the market Liede project will be KWG next two years, the strong performance of power.” KWG said.
In fact, including Liede project included KWG push this year to enter another round of disc key, the next two years will be in Guangzhou, Beijing, Suzhou, Chengdu, Hainan launched five regional projects. Report shows that, at the end, the company a total of 18 development projects, is expected in 12 to 18 months were pre-sale.

“In view of the strong pre-2009 results, we expect better growth in 2010.” KWG said the group plans to achieve 2010 sales of 10 billion yuan contract.

In 2009, KWG revenue growth of 1.71 times in 2008, reaching 4.3 billion yuan. KWG CFO Xujin Tian explained that the revenue increase was mainly increased the pay floor last year area. In addition, pre-2009 amounted to 7.6 billion yuan, 3 times in 2008, exceeding the original goal of 50%.

Year to date, KWG announced projects are still good sales momentum. Introduced this year, “head shot” – Guangzhou Zengcheng “Yu Shan international” part of an integrated project villa “Yue Four Seasons” in the March 21 sale, have made impressive sales performance.

View projects in other regions combined performance of the same eye-catching. April 7, the company announced the result, including Guangzhou, Chengdu, Beijing and other major cities, strong sales in the first quarter sales amounted to 3.6 billion yuan, up significantly increased 5-fold, has completed the full year sales target of 36%.

Group also said in the second quarter will continue to introduce the four cities of new phases of existing projects, including Beijing, Hong Yue Four Seasons, Suzhou Peak Health International, Chengdu, Vision City, and Yu Feng, Yu Guangzhou, Hill International.

Credit Suisse research report, KWG in the second quarter sale of the new order will bring short-term momentum for the company’s stock rating remains “outperform the market.”
Credit Suisse has been present as the Year of the Tiger KWG recommended 8 “lai stocks,” one, and is one of the only unit within the room.
The industry believes that, including “reputation of Hill International,” including high-end property Liede project step by step into the market, not only will bring KWG performance increase will also consolidate the company’s profitability.

This view has also received recognition from professional bodies, had, in the China Real Estate Association, the State Council Development Research Center of enterprises, Tsinghua University Real Estate Institute and the China Index Academy of four agencies jointly Award, won the 2010 KWG hundred Chinese real estate enterprises, while profit jumped to one of the top 10.