The negative impact of commercial real estate in the future will exceed or exceed the residential market.

First-and second-tier cities are seriously oversupplied, and third-and fourth-tier cities are facing investment risks.

The first half of the year has passed, and news of loss, closure and closure of stores often appears, which makes people more worried about shopping centers and department stores that are sparsely populated and deteriorating.

It is an indisputable fact that commercial real estate is saturated. However, this has not stopped the rapid development of commercial real estate projects, and a large number of shopping malls are still springing up like mushrooms after rain. Dalian Wanda, for example, claims to build a 100 wanda plaza a year. People can't help asking, are real estate companies keen on developing commercial projects because of market needs or other reasons?

Experts remind that in the next few years, the adjustment of commercial real estate in second-and third-tier cities will be inevitable. How do enterprises cope with this challenge? We must pay enough attention to mitigating the impact of adjustment on the market and economy.

Total accumulation fund

"I believe that at present, the supply of commercial real estate in China has generally exceeded demand, and there is a serious surplus in first-and second-tier cities, and some third-and fourth-tier cities still have demand." Huang Hai, former assistant minister of the Ministry of Commerce and director of the domestic trade expert committee, said in an interview with China Business Daily.

According to statistics of relevant departments, the total number of non-residential complexes in 50 key cities in China has reached 564 million square meters in 20 15, an increase of 77% over 20 13. In 20 14, the newly opened area of global shopping center110.4 million square meters was higher than that in 20 13/0.06 million square meters. Among the 20 most active new shopping centers in the world, China accounts for half of the country and contributes 5.7 million square meters of completed area. China Shopping Center Industry Consulting Center predicts that 7,000 shopping centers will be completed and opened in 2025, and there will be more than 10000 shopping centers in China.

"The total amount of commercial real estate in first-tier cities has reached saturation, and even some areas have been surplus." Lai Yang, president of Beijing Jingshang Circulation Strategy Research Institute, also expressed the same view when interviewed by Huashang Daily reporter. He believes that the oversupply of commercial real estate, coupled with poor management, has led to a decline in retail performance and has to be transformed or closed down.

In a recent interview, the reporter found that the tide of retail enterprises closing down since last year has not slowed down. Due to the surplus of shopping centers and other formats, department stores have closed down or transformed. According to the survey, Parkson Commercial has closed eight stores, Huatang closed four stores in Beijing in the past year, and Wanda Department Store closed 10 stores. According to the data of Ruiyide China Commercial Real Estate Research Center, 38 large chain department stores have closed since last year. The department store brands with the largest number of closed stores are Parkson and Martha Spencer, each with five; Followed by Ito Yokado, closing four stores. The phenomenon of closing stores in cities such as Beijing, Hangzhou, Qingdao and Tianjin is serious.

From Wangfujing, Xidan and Guo Mao in Beijing to Nanjing Road and Huaihai Road in Shanghai, today's big department stores are sparsely populated and few people care about them. Many internationally renowned brands have disappeared, and second-tier brands are competing to sell goods at a discount. From first-tier cities to second-and third-tier cities, from the eastern coast to the inland of the central and western regions, the sales of a large number of physical stores are declining.

It is difficult to attract commercial real estate investment in big cities in Guangdong. Huang Wenjie, president of Guangdong Commercial Real Estate Investment Association, said that the supply of commercial real estate has exploded in recent years, and the competition for excellent commercial resources has become increasingly fierce. At the same time, the commercial real estate industry generally faces difficulties in attracting investment.

Huang Hai told the Huashang Daily reporter that "the rent of domestic commercial real estate is too high, and the rent has entered the top two in the cost of commercial enterprises, which is unbearable. Commercial profit margins are inherently low. In recent years, the decline in sales growth has aggravated the difficulties. After the leases of many shopping malls expired, landlords could not renew their contracts because of rising rents, and some even closed their doors during the lease period. "

Huang Hai believes that "the saturation of commercial real estate is relative, not absolute. The real estate market in first-tier cities is gradually maturing, and urban land resources are already very rich, but some new residential areas still need to build commercial real estate. " There will be a supply peak in the second, third and fourth lines, and most of the total supply of urban complexes will be concentrated in the second and third tier cities in 20 15 years.

"I don't think it can be said that the supply is in short supply and needs to be subdivided." Zhang Jing, senior manager of RET Ruiyide Strategy Consulting Department, said in an interview with China Business Daily that from the perspective of area and volume alone, commercial real estate has experienced explosive growth this year, with a supply of one million square meters in Beijing, and many individual units have reached the level of10,000 square meters. This trend will not stabilize until 2020.

Surround the city with the countryside

The reporter learned that because the commercial real estate market in first-and second-tier cities is basically saturated, housing enterprises have begun to turn their attention to the centers of third-and fourth-tier cities and even fifth-tier cities. Some developers also choose to lay out commercial real estate through the strategy of "rural encircling the city".

More and more housing enterprises are beginning to focus on the "fat" of commercial real estate. Recently, Vanke is also developing commercial real estate on a large scale. According to public data, Vanke's commercial real estate development has been rolled out in more than 60 cities across the country, and more than 20 urban commercial complex projects have been planned in the central business district of first-and second-tier cities across the country. There are also large-scale community businesses and regional shopping centers, such as Vanke Red Plaza and Vanke Life Plaza. According to Vanke's latest development plan, this enterprise determined to transform is seeking to rapidly increase commercial real estate assets, and Vanke has promoted commercial real estate to the development direction and strategic height of the Group.

The supply of commercial real estate has seriously exceeded the demand. Why are there still so many real estate developers flocking?

"I think the internal reason is that big developers want to occupy the market quickly." Lai Yang, dean of Beijing Jingshang Circulation Strategy Research Institute, said, "At present, the commercial format structure of third-and fourth-tier cities is not reasonable, with low-end small commodity wholesale markets as the mainstay, combined with wholesale and retail, and retail as the mainstay. This kind of market is composed of various businesses, with low product quality, chaotic management and potential safety hazards. This gives a big developer like Wanda an opportunity. Big developers like Wanda and China Resources have no competitors in third-and fourth-tier cities. They seized the fence. On the one hand, they can enhance the local land value, develop the real estate market, and make up for the losses in commercial real estate with real estate profits. On the other hand, in the long run, we can crowd out other competitors and achieve the goal of dominating one side. "

According to Ke Rui, at present, commercial real estate has entered the second wave. At the present stage when various exit mechanisms are gradually established and improved, it may be a good time to enter commercial real estate. However, many real estate developers regard the huge potential value in the future as an important criterion for site selection, which is bound to face a longer business support period. Whether it is self-sustaining or leaseback, it will bear a greater degree of financial pressure. In order to cope with the financial pressure, it will be passed on to investors or the mainstream.

"The wanda plaza model will have great room for development in third-and fourth-tier cities." Zhang Jing, senior manager of RET Ruiyide Strategic Consulting Department, has his own unique views. She believes that in third-and fourth-tier cities, people's consumption level and consumption habits still remain in the brand recognition of first-tier cities 10 years ago. For example, KFC and McDonald's are still very popular in the local area, but they are no longer sought after in first-tier cities. Therefore, commercial real estate like wanda plaza has entered a period of rapid growth.

"There are still many market opportunities in third-and fourth-tier cities. There are no shopping centers in many cities, including prefecture-level cities and county-level cities, where the economy is developed. There are still opportunities to enter these cities. " Ouyang Jie, senior vice president of Xincheng Holdings, recently said, "Only 1600 shopping centers can be built in third-and fourth-tier cities in the future. Judging from the speed of shopping center construction in recent years, the number of shopping centers built every year is around 400, and the era of national shopping centers in the past decade is coming to an end. "

The change of management thought

Although the market prospect is promising, some insiders still point out that there are many potential problems and risks. Although these third-and fourth-tier cities do not have a good commercial complex at present, the Wanda model may not be advanced. In the future, with more and more housing enterprises joining, "hand-to-hand combat" may be inevitable.

At present, the homogenization of commercial real estate is serious. Lai Yang pointed out that the core of housing enterprises to seize this market is to make differentiated products, otherwise homogenization competition is prone to risks. At present, shopping centers mainly focus on shopping and catering, and few really regard shopping centers as a way of life.

"Because of homogenization, attracting investment is difficult to become a common problem under the new economic normal." Huang Hai believes that the current market growth is declining and the demand for commercial facilities is declining; The supply of commercial real estate exceeds demand, and the competition is fierce; The construction and decoration standards of commercial real estate projects are too high, and the rent cannot be reduced; E-commerce has diverted a large number of commodity demand, making physical stores worse.

From the external environment, with the change of consumers' consumption habits, traditional department stores are diverted from shopping centers that focus on experience formats. This complex focuses on eating, drinking and having fun. Consumers want to enjoy this experience, such as watching art exhibitions, watching movies, swimming and playing games. In the original shopping center model, such consumer services are not provided. Therefore, Lai Yang proposed that the old model must be improved. Commercial operation should not be divided by format, specialty and category, but should integrate goods and services around the lifestyle of a group of consumers. The lifestyle center that has sprung up in recent years reflects this change in business philosophy.

In Lai Yang's view, the business development under the new normal is mainly divided into two major trends. The business in the city is mainly transformed into a "lifestyle center", and the business in the suburbs is gradually developing into a "leisure and entertainment destination". For example, Oriental Xintiandi and Xidan Joy City have a strong ability to attract customers. Many traditional department stores are facing transformation, adjusting brand structure, adding new formats such as catering, leisure, entertainment and education, and adding more fun experiences to meet different levels of consumer demand. Jinyuan New Yansha Mall has been constantly adjusting its brand structure, focusing on life and leisure, creating the concept of family mall, and combining with new media marketing, it has successfully attracted a large number of young family consumers. Beijing SKP (Guangxin Tiandi) has made great achievements in succession. Last year, it ranked first in the national key shopping malls/shopping centers with sales of 7.5 billion yuan, and held the top spot in the "Money Department Store".

"Innovation and transformation is the only way". Lai Yang said that as long as physical stores are close to the market demand for innovation, the sooner enterprises innovate and transform, the easier it is to seize the opportunities. In the face of the rapid rise of e-commerce, the urgent task for the surviving traditional department stores is to speed up the transformation.

Zhang Jing, senior manager of RET Ruiyide Strategy Consulting Department, believes that although there is an overall surplus of commercial real estate, there are still some truly distinctive and differentiated physical stores. "If the shops are the same, there will be surplus without any difference. If they are unique, they will stand out." Beijing Chaoyang Joy City highlights the characteristics of play. Last year, its sales jumped to 2 billion yuan, an increase of 30% over the previous year. Blue harbor attracts handsome men and beautiful women in love with its rich exotic customs; The unique design of Fangcaodi Shopping Center is unique with its elegant artistic atmosphere. "The emergence of new commercial projects is also a good thing and a challenge to those rigid traditional old projects. After the competition law of survival of the fittest, the rest is the essence. "

The old format that has not got rid of the commercial real estate operation mode will be eliminated. Experts predict that if the business format represented by traditional shopping malls is not adjusted, transformed and upgraded, it will face enormous pressure for survival, so a scuffle is inevitable.

Enclosure has great risks.

"Although commercial real estate in third-and fourth-tier cities still has room for development, due to the declining population and limited demand space in third-and fourth-tier cities, developers eager to occupy land in third-and fourth-tier cities may face investment risks." Lai Yang said.

Zhu Haibin, chief economist of JPMorgan Chase China, pointed out that commercial real estate will face greater risks in the next year or two, and its adjustment range and speed will exceed that of the residential market, so we should be alert to the possible negative impact on the economy as soon as possible.

At present, the phenomenon of oversupply of commercial real estate is very obvious in many second-tier cities. In some cities, the planned new supply even exceeds the current total inventory. On the demand side, the demand for commercial real estate may shrink. Zhu Haibin is more worried that "once the commercial real estate falls sharply, it is difficult to adjust the policy." In addition, the development and financing mode of commercial real estate is relatively easy to lead to drastic adjustment of the market. Once the market is depressed or there is a problem with the capital chain, it will easily lead to the phenomenon of the whole project going bad. In fact, data in recent years show that the fluctuation range of commercial real estate investment far exceeds that of residential investment.

Judging from the macroeconomic impact, although commercial real estate investment accounts for about 30% of all real estate investment, it is far lower than residential investment. However, from the impact on the upstream and downstream industries, the impact of commercial real estate can not be ignored. For example, Zhu Haibin said that taking the demand for steel as an example, real estate and construction contributed about 60% of the demand, but the demand from residential and commercial real estate was basically the same. In other words, the demand for investment steel in commercial real estate units is almost twice that of residential buildings.

How to face the risks that commercial real estate may face? Judging from the relationship between supply and demand, the adjustment of second-and third-tier cities will be inevitable in the next few years. What is more realistic is how to deal with this challenge and how to slow down the impact of adjustment on the market and economy.

Zhu Haibin believes that "from the perspective of developers, commercial real estate development should pay more attention to the changes in market supply and demand and improve the characteristics of the project. From the financing way, we can develop innovative financing means based on the capital market, such as real estate investment trust REIT and commercial real estate mortgage-backed securities CMBS. From the perspective of economic policy, we must strive to find a reasonable balance between steady growth and structural adjustment, and avoid the consequences of interfering with the normal adjustment of the market under the pretext of stability. "