Three cities seized land in one week, but faced with different markets, it also reflected C&D’s different land acquisition strategies.
Viewpoint Network Among the multiple-choice questions of “conservative wait and see” and “scale expansion”, the “C&D Department” continues to favor the latter.
Within a week from April 3 to April 9, C&D acquired 4 land parcels in Xiamen, Quanzhou, Fujian, and Lishui, Zhejiang, with a land acquisition amount of 3.873 billion yuan.
Specifically, on April 3, C&D Real Estate won two residential lands at a base price in Nan’an, Quanzhou. The total area of the land is about 60,300 square meters, and the total transaction price is 662 million yuan.
Among them, Nan’an 2023P01 plot in Pengmei Community, Ximei Street has an area of 21,700 square meters, a plot ratio of 1.0-2.5, a total construction area of about 54,200 square meters, and a starting price of 244 million yuan; Pengmei Community, Ximei Street Nan’an 2023P02 plot has an area of 38,600 square meters for transfer, a plot ratio of 1.0-2.4, a total construction area of about 92,800 square meters, and a starting price of 418 million yuan.
The next day, C&D International, the main real estate listing platform of C&D, participated in the bidding, auction and listing of land in Lishui, Zhejiang through its subsidiary Hangzhou Zhaohui Real Estate Co., Ltd., and acquired a plot of land for 973 million yuan. This land acquisition is also the first time for C&D to enter the Lishui market.
The land is for urban residential land, urban community service facility land, retail and commercial land, and catering land. -1,000 square meters, and the supporting housing for the community shall not be less than 1,380 square meters.
On April 7, C&D Real Estate appeared in Xiamen. On that day, Huli District publicly sold the 2023 Zhixie No. 001 plot. The land area of the plot is 57,100 square meters. The set of units was finally bid for 2.238 billion yuan.
Three cities seized land in one week, but faced with different markets, it also reflected C&D’s different land acquisition strategies.
Xiamen is the headquarters of the C&D Department, and has maintained the number one market share in the local area for many years. According to public information on the Internet, in 2022, the full-scale sales of C&D real estate in Xiamen will reach 21 billion yuan, and 5 of the top 10 commercial housing sales projects belong to C&D.
In terms of land, C&D participated in the first, second and fourth batches of centralized land supply in Xiamen last year except for the third batch, spending 9.44 billion yuan, 5.09 billion yuan, and 2.1 billion yuan respectively, and harvested 6 land parcels in total. It was the most active real estate company in the city that year.
Like Xiamen, Quanzhou is also a traditional advantageous market for C&D. It is understood that C&D entered the “Great Quanzhou” market in 2013, which includes 4 districts, 3 cities, and 5 counties, and will occupy the second place in the market with a sales amount of 6.1 billion yuan by 2022.
Through its strong market position in Xiamen and Quanzhou, C&D can therefore maintain a low land acquisition cost, but the follow-up profit performance of the same land may also be limited.
Of course, a large part of the reason is that C&D acquired Anshangfang this time. According to the data, the full name of Anshangfang is resettlement-type commercial housing, that is, a project includes two attributes of commercial housing and resettlement housing. Unlike resettlement housing, Anshang housing is not subject to the 5-year restriction, and can be listed for trading after obtaining a real estate certificate, but the price is usually 30% off the price of ordinary commercial housing.
In 2021, Xiamen will issue a specific plan for Anshangfang, announcing that 7 Anshangfang communities will be built, 6 in Huli District and 1 in Jimei District. The 2023 Zhixie No. 001 land plot won by C&D this time belongs to the C20C23 commercial housing project of the second phase of Huli Zhongzhai Beiyuan.
In Quanzhou, since 2017, the local government has introduced control measures for the overheated land auction market. The two residential land in Nan’an that C&D won this time were also sold through the method of “restricting house prices, land prices, and competition for construction”, although they were at the reserve price. Obtain, but also accept the transfer condition that the highest average sales price of the residential part after the project is completed is limited to 12,000 yuan/square meter.
C&D previously landed three projects in Nan’an: C&D·Yingyue, C&D·Hexi and C&D·Manyun. Among them, Jianfa·Manyun, which is close to the newly acquired land, is also a project with restricted housing prices. There is a difference of 8,059 yuan between the land acquisition project of 3,941 yuan per square meter and the price of 12,000 yuan.
On the other hand, for the 2023P01 and 2023P02 plots in Nan’an, Pengmei Community, Ximei Street, the land acquisition cost has increased to about 4,500 yuan per square meter.
As for the newly entered city of Lishui, C&D is caught in a fierce battle for land. Due to its location in the city center, the plot was finally sold after 133 rounds of bidding under the circumstances of many real estate companies hunting for it.
As one of the most active real estate developers in domestic land acquisition at present, according to the data, C&D has won a total of 62 land parcels in 2022. Compared with 2020 and 2021, the intensity has decreased, but it still ranks among the top 5 in the industry.
In the first quarter of 2023, the market has entered an adjustment period after the release of prevention and control policies. Developers are taking a more wait-and-see attitude towards the land market. C&D is also one of the few real estate companies that have taken land expansion actions.
The desire for sales scale means a strong desire to acquire land. According to C&D Hong Kong-listed platform C&D International’s statement at the performance meeting, the company will strive for 10%-20% sales growth in 2023, which emphasizes more efficient investment. expand ability.
In the past, C&D was famous for its heavy warehouses in first- and second-tier cities. However, due to the gradual recovery of the land market in these top cities and the rising competition, C&D has been promoted to enter the low-tier cities in the developed regions of the Yangtze River Delta in addition to consolidating the basic market of Xiamen and Quanzhou. Lishui.
“In addition to obtaining good first- and second-tier city land plots, we will also strengthen the expansion of third- and fourth-tier land that meets the improvement needs, especially the more familiar and secure areas of Fujian Province and even the Yangtze River Delta.” C&D International management said at the performance meeting.
However, it is worth noting that during the rising market period, how to control the cost of land acquisition in the process of rapid expansion is the key to C&D’s next investment and development work. At the beginning of 2021, C&D was interviewed by relevant government departments for acquiring land at a high premium in Shanghai.
At the same time, this is also a kind of damage to C&D’s profit margin. According to the data, according to the 2022 annual report, the gross profit margin of C&D’s real estate business is only 14.6%, while the gross profit margin of C&D’s real estate business has dropped from 28.69% and 20.89% to about 16.76% in 2019, 2020 and 2021. In addition, the gross profit margin of C&D International in the same period of 2022 was recorded at 15.28%, a year-on-year decrease of 1.36 percentage points from 2021.
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