Business recovery presses the "acceleration button" Foreign capital is optimistic about the second half of the year

China News Network, 5 May Topic: Business Recovery Presses the "Acceleration Key" Foreign capital is optimistic about the second half of the year

Zhongxin financial reporter Pang Wuji

Since the beginning of this year, the trend of consumption recovery is clearly visible. According to data released by the National Bureau of Statistics, the year-on-year growth rate of China's total retail sales of consumer goods accelerated to 4.18% in April. As an important commercial facility in urban services, shopping malls play an important role in accelerating consumption recovery and boosting market confidence. With shopping malls as windows, how is business recovering?

Wang Yongping, chairman of the Commercial Real Estate Working Committee of the All-Union Real Estate Chamber of Commerce, recently said at the 2023 "CapitaLand New Gathering" series salon that the trend of business recovery this year is very obvious. However, this recovery has structural characteristics: passenger flow recovers faster than sales, catering and experience formats recover faster than retail, and leading enterprises recover faster than small and medium-sized enterprises.

Wang Yongping believes that the current recovery of consumption is within the normal range. Previously, some people were overly optimistic, believing that there would be retaliatory consumption after the epidemic, but in fact, retaliatory consumption did not appear, and it is still dominated by recovery consumption.

Foreign-funded enterprises have revealed their confidence in business development this year, especially in the second half of the year. Yang Qinfu, Chief Executive Officer of CapitaLand Investment (China) Commercial Management, revealed that overall, CapitaLand's passenger flow and sales recovery have been largely consistent. Economic recovery is not like "driving flat" and stepping on the gas pedal to get off immediately, it is more like "plane takeoff" and it takes a while to climb.

He said that CapitaLand's business in China is extensive, and although the recovery situation varies from city to city and business format, the current occupancy rate and occupancy rate are gradually improving, and the second half of the year will be better. Among them, Yang Qinfu revealed that the fastest recovery Suzhou Central Shopping Mall, the passenger flow during this year's "May Day" period increased by nearly 2019% compared with the same period in 25, and sales increased by nearly 60%, of which there were more than 48,<> passengers on May Day.

According to reports, after the transformation and restructuring in 2021, CapitaLand Investment will focus more on investment management and fund management. CapitaLand's global assets have reached S$1330 billion. CapitaLand is one of CapitaLand's core markets, and CapitaLand is optimistic about the Chinese market for a long time, actively looking for opportunities to expand investment and asset management, especially high-quality assets in China's first- and second-tier cities, from traditional shopping malls and office buildings, to new economy assets such as industrial parks, logistics and data centers, and diversify its portfolio. Mr Yang revealed that CapitaLand's new investment in China reached RMB200 billion last year.

The warehouse membership giant Opener is also rapidly expanding its business in China. According to reports, in 2023, in addition to the trial operation of the Costco Pudong store in March, three new stores in Ningbo, Hangzhou and Shenzhen will also open within the year, and plan to enter the Nanjing market next year. In addition, McDonald's, Starbucks, Tempeschi, Ralph Lauren and other brands have said this year that they will increase investment in the Chinese market.

From the perspective of the transformation trend of China's commercial development, Wang Yongping believes that in recent years, commercial real estate has shown three changes - from quantity to quality, from development to operation, and from increment to stock. Looking ahead, he believes that the period of rapid development of commercial real estate has passed, the era of large-scale increments is gone, and in the future, enterprises will return more to the operational level, that is, to the essence of commercial real estate.

Chen Fangyong, Secretary-General of the China Urban Renewal Forum, believes that the past few years have actually been a big test for all physical business operators, and those who are still eligible to play football are either survivors or new entrants, and their survival status will determine the trend of "post-epidemic" business development. For example, from "O2O" to "OAO", from "new retail" to "new consumption", from "cultural and business tourism" to "cultural and commercial tourism production", etc.

How to better release consumption potential? A number of industry insiders talked about new consumption.

Lili Qian, Regional General Manager of North China Commercial Management of CapitaLand Investment (China), said that from the perspective of North China, most commercial real estate operators are targeting young and fashionable customers, which is also the concentration of most shopping malls in China. In addition to product classification, she said that CapitaLand will have some ingenious actions in the experience of new consumption scenarios. For example, Qingdao CapitaMall Xinduxin Project pioneered an IP honeypot bear story.

However, Wang Yongping also cautioned that new consumption may not mean blindly pursuing experience. He said that in recent years, talking about new consumption and business innovation, there is an important idea is "to retail, change experience", it seems that the lower the retail ratio, the better (20-30%), but is this really the only way to be right? COSTCO, SAM'S CLUB, AND SKP BASICALLY HAVE NO EXPERIENCE FORMAT, AND THEY SELL VERY WELL JUST BY SELLING THINGS.

Therefore, he believes that new consumption may need more new goods, Chinese now it is not consumption downgrade, but the lack of good goods that can make them have the impulse to upgrade consumption. On the one hand, developed e-commerce has mastered massive consumption data; On the other hand, Made in China has the strongest product production capacity. He believes that in the future, China will create more and better innovative brands and truly get out of the industry dilemma of "more shopping malls and fewer brands". (End)