Author | Cao Anxun
Editor | Zhou Zhiyu
Property companies were once the darlings of the capital market. Now, as the industry tide recedes, they need to start afresh and find a breakthrough to navigate through the industry cycle.
Zhu Baoquan, Chairman of Wanwu Cloud, believes that now is a good time for property companies to break away from the independent market trend.
At the shareholders' annual meeting on May 10th, Zhu Baoquan stated that in the current Chinese real estate market, transitioning from basic property operations to deepening asset management (AM) presents a great opportunity for property managers and building administrators.
Zhu Baoquan pointed out that for a light-asset property company to reach where it is today, its future development requires iterative upgrading.
During his research trip to Japan, Daiwa House left a deep impression on him. Daiwa House transitioned from apartment operations to customized land development for landowners, designing investment returns, and providing a comprehensive range of services. &#34;In other words, if later operations can involve the same parties in the earlier transformation, it will make these heavy asset investments more efficient.&#34;
In Zhu Baoquan's view, if property companies can extend upwards and customize real estate and facility investments, it will create a completely different landscape. Similar to Daiwa House, it can ensure that leased apartments achieve a 90% accounts receivable ratio, while also strengthening its own investment capabilities.
Now, after mastering the most basic property operations management, how to extend towards higher-level asset management and fund management is what Wanwu Cloud is currently contemplating and practicing. This also determines whether Wanwu Cloud can lead the way in breaking through the current industry challenges and stepping out into an independent market.
Zhu Baoquan proposed that the years 2023-2025 will be a watershed for the industry. For property enterprises to cross this watershed and move from the downstream of the real estate development industry chain to a new era based on holding real estate for consumption, they must break free from path dependence.
This is also an important way for property enterprises to step out of the shadow of real estate development cycle adjustments and achieve a return to value.
From 2018 to 2020, as the real estate industry surged for many years and leading real estate companies grew rapidly, the value of property management sectors of real estate companies soared, and the property industry witnessed a wave of IPOs and mergers.
However, as the real estate development industry entered a downturn, property companies saw significant decreases in revenue and gross profit from related entities, leading to a decline in their stock prices.
For present-day property enterprises to survive and thrive, expanding solely through residential property operations, repurchasing shares, or executives increasing holdings to save stock prices is not enough. It is urgent to start from the root, transform the business model, and establish a completely new value evaluation model in the capital market.
China Index Research Institute pointed out that in recent years, innovative services represented by urban services, IFM (Integrated Facility Management), and commercial operations have risen strongly, opening up greater imagination space for the property management industry. With the enhanced independence of listed property enterprises and the gradual elimination of related party risks, property stock values are expected to return.
Zhang Hongxi, Secretary-General of the Shenzhen Property Management Industry Association, also predicts that in the future, among the top property enterprises, businesses strongly cyclical and highly related to real estate development will gradually fade out. Instead, they will lean towards businesses with strong sustainability, such as group dining, facility equipment services, and asset services related to existing housing, gradually forming differentiated competitiveness in segmented markets
Waking up from the capital frenzy of wealth creation, one can see the true core value of enterprises, and change is imperative.
After the property sector was spun off from the real estate parent company, reducing dependence and independent growth is only natural. However, the cyclical adjustment in the real estate industry has accelerated this process.
As the top property enterprise without bank loans, with 15.6 billion cash on hand and achieving both revenue and core net profit growth for the first time since its listing last year, Wanwu Cloud is indeed a pioneer in exploring new paths.
Now, breaking free from the saturated market of basic property management and entering the vast blue ocean of asset management, Wanwu Cloud aims to boldly break through. This poses an unprecedented challenge for the industry, and although the road ahead is long, it has already set off, leading this industry revolution

Wanwu Cloud launched an industry revolution