2014-06-17

Ye Tan: Real Estate Needs a New Engine

She mentions hive cities at the start, more on those here. This is the plan by some developers to go vertical. Not only will they build homes, they will build the entire city infrastructure around the housing as well: retail, medical, education, travel, water, sewage, electric etc.

She criticizes Chinese cities, where every little city is engaged in the same strategy of attracting population, digging lakes, erecting tall buildings and paving new streets. They're all competing in the same areas, destroying their competitiveness in the process. What is needed are schools and elder care services, if they can combine with real estate developers it will be a wonderful rare sight.

In Shanghai, a dilapidated house in a good school district goes for ¥80-100,000 per sqm. In Beijing, homes in the Beijing Second Experimental Primary School district go for ¥300,000 per sqm. The biggest threat to these home values would be from the government changing admissions rules. Nursing homes are similar; government subsudized quality facilities have a 10-year waiting list; others charge more than ¥10,000 per sqm.

叶檀:房地产需要新引擎
 Home Builders is a large-scale transformation, winners win, the losers out of the market. Different from previous management and the market value of cash flow management, the transformation is a fundamental change in the intrinsic gene.

  Fosun Group CEO Liang Xinjun said the real estate in the next 6-8 years to reverse, even if the local government is trying to maintain a stable land prices to repay high debt, but the next three to five years after land prices will continue to reach equilibrium point reversal. Xinjun consider doing hive city, in order to follow the traditional model of real estate development distance.

  The so-called hive cities, the first difference is that the functionality provided by the project for the city, not a simple function of living, office functions, but should be the core functions of the city. Xinjun said bluntly, "If you touch the past has been the real estate, why not bumper major health, from training and education, research and development, pharmaceutical manufacturing, pharmaceutical wholesale to retail, hospitals downstream to the pension, to health care, to pay the whole big health industry , insurance, payment channels, and so on throughout the session, a lot of people can do. "

  People living alone, people shopping, residential real estate, commercial real estate to show weakness, rigid demand and needs to improve residential glass ceiling looming, the rigid requirements for the system over the attractiveness of urban housing; while a large number of new residents into the city, require a long-term wealth accumulation process, in order to form a new purchasing power. Commercial properties are subject to tremendous impact electricity suppliers, competition, and build new district offices everywhere, companies frequently self-built enclosure small cities, simply set the bullet to the neck. Local government is not maintaining premium Dinghaishenzhen, land revenue to finance are important, but in the monetary tightening, corporate debt rate is high, residents are expected not clear when the local government can not directly took out his wallet and stable land residents.
 
 Real estate needs a new engine, the new engine is the combination of scarce resources.

  Indeed, serious excess manufacturing capacity, but on the back of excess, many serious resource scarcity.

  A small population of the city continue to absorb and spend great effort and capital filled lakes, built high-rise Avenue, blocking traffic, that this is a symbol of modern, not knowing handedly destroying their environment in competitiveness, his other cities placed on the same platform competition, this behavior got overconfident GDP and high debt, so that these cities are in total defeat of the competition. China does not need a city dotted with financial need is based on the sound of the local financial services sector, it is precisely in this regard over the weak, and basically in the same competition embarrassment.

  The so-called tourism, real estate, that is beyond the everyday life at home to open a window, the window is usually offered a rare metropolis leisure experience, is complains Manwu, bridges, trees, is looking upward That landscape, to friends, family get together the rest of the space, meticulous service is reflected in all the nuances of the Internet, transportation, etc., can be a little domestic scale, looks like some tourism real estate is not much.

  Both now and in the coming decades, China's most scarce education, pension and other services, combined with the scarcity of real estate services sector, bursting out wonderful. Housing turnover in the doldrums, the city school district room contrarian firm: Shanghai Jing'an District, a dilapidated school district used small apartment house price up to 80,000 to 100,000 yuan / square meter. More exaggerated Beijing, set close to the Beijing Second Experimental Primary school district room offer even more than 300,000 yuan / square meter. Property quality is not high, prices are very strong, not the old house itself has any advantage, but these properties enjoy a high-quality education resources scarcity premium. Housing for the school district's most significant blow, the local government to change admission rules.

The same room with the school district's real estate is scarce endowment real estate, government-subsidized high-quality nursing homes need to queue for more than 10 years, while other high-end places nursing home insurance, bonds, etc., in the absence of property rights cases enjoying more than 10,000 yuan per square meter high prices. Community nursing home is not easy to maintain breakeven, and a large pension estate recovery rolling cash flow, another 10 years more scarce resource endowment, pension estate will enjoy a high premium pension services.
 
 Other scarce resources, including commercial real estate experience, and has extensive experience in industrial clusters industrial park real estate, etc., real estate restructuring process is combined with society's scarce resources, developers featured service providers transition process.

  Home Builders transformation, they not only have to build a house, build the city, and even provide some government functions, set up schools, hospitals, the environment, etc., across this step, real estate developers will be invincible.


失信、欺诈是债务危机根源 (Dishonesty, fraud is the root cause of the debt crisis )
叶檀:信用体制不建立 金融市场化将是庞氏骗局 (Credit System Not Built Financial Market Is A Ponzi Scheme)

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