The exhibition on the north of the merger and acquisition of the first-line suburbs
Link Exhibition (00823) has been pointing to the mainland. Chief Executive Wang Guolong announced in November last year that he would raise the upper limit of China’s investment ratio from 12.5% to 20%. He then announced the purchase of Beijing Jingtong Roosevelt Square for RMB 2.56 billion at the end of the month. The mall is located outside the Fifth Ring Road in Beijing. Some analysts believe that it is not easy to find a target for acquisition in the center of the first-tier city. Therefore, it is believed that the future of the exhibition will be higher in the future away from the city center.
Wang Guolong once said that he will continue to look for projects in the first-tier cities in the Mainland. Beijing Jingtong Roosevelt Plaza, which was purchased by this consortium, has 6 floors of retail floors and 576 parking spaces. It is located in Tongzhou District of Beijing, outside Beijing’s Fifth Ring Road. It is the second acquisition of the second exhibition in Beijing and the mainland. . Tongzhou, Beijing is known as the city’s sub-center. In 2017, the mainland announced that several departments, including the Beijing Municipal Committee, the Municipal People’s Congress, and the Municipal Association, have taken the lead in moving in, hoping to channel the crowds for the crowded Beijing. In addition, Beijing Universal Studios is also located in Tongzhou and is expected to open in 2020.
Good management track record, high rental adjustment rate
Hong Kong real estate industry analyst Qiu Zhuowen of DBS Research believes that it is not easy to find acquisitions in the first and second ring of the first-tier city center. It is necessary to ensure the quality of the project and to meet reasonable returns. The chances of a central location acquisition are higher. He said that in the past, the exhibition has a good track record in the operation of the shopping malls in the Mainland. The lease cycle is about three years. Upon expiration, the tenant mix and rent increase can be adjusted. According to the information, more than 52% of the retail leases in Jingtong Roosevelt Square will expire this year and next. The Lecture also stated in the notice that after the expiration of the retail tenancy, there was an opportunity to upgrade the rent renewal and enhance the performance of the tenants by upgrading the tenant mix.
In 2015, the company purchased the Beijing Ouhuihui Shopping Center, Shanghai Lingzhan Enterprise Plaza 1 and 2 (formerly known as Enterprise Tiandi No. 1 and No. 2), and purchased the Guangzhou Xicheng Duhui Plaza in 2017. According to the results of the full year of the past three years, the rental renewal rate of the retail malls in the Mainland has ranged from 32.6% to 39.1%, the rental renewal rate of office renewals has exceeded 10%, and the occupancy rate at the end of the year exceeded 99%. The rent adjustment rate for renewal of rents ranged from 23.4% to 31.2%.
However, Wen Xuansen, executive director of CMB International Research Department, reminded that it is not easy to operate shopping malls in the Mainland. Even mainland developers can only operate successfully, such as Vanke (02202), Rundi (01109) and Longhu (00960). ), etc., the public opinion has crossed Jianglong, but he agreed to lead the exhibition with good track record. He continued that whether a shopping mall is operating well, it is best to personally inspect the flow of people in the mall and check the occupancy rate. “I have tried to use the wallpaper in the Mainland to seal up the Kyrgyz shop and install it into a wall to make it look like a small shop." Also, we must also pay attention to the e-commerce challenge nowadays. Many customers have to sell instead of the restaurant. For meals, it is necessary to try to introduce facilities that are difficult to replace with e-commerce, such as facilities or venues that are related to children. In addition, some retailers will also be transformed. Shops are mainly used to display products more than sales to attract people.