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The depression haunting Europe and America made companies from developed economies pay more attention to emerging markets. It is the same for the Chinese real estate market. Though the Chinese real estate market met great fall because of regulation and control the pessimistic opinion prevails thus year, some foreign property companies are still bullish on the Chinese market and speed up their distribution in the second- and third-tier cities of China against the trend.
“Now there is an opportunity. We’ve been bullish on the Chinese market for long and hope to further increase the weight of our business in this Chinese,” said Erez Applerot, CEO of GTC Real Estate China, the largest real estate company in Middle and East Europe. He showed his confidence in investing in China and established their presence in Chengdu, Dalian and other second- and third-tier cities of China. In Applerot’s opinion, China is already a part of the company’s development plan and its unusual path in China is to develop in the second- and third-tier cities of this country.
Seven Years’ Development
GTC Real Estate China is a subsidiary company of Holland-headquartered Kardan Group. It began to get engaged in the real estate development business from 1994 and is the largest real estate developer in Middle and East Europe. Presently GTC Real Estate China has business in more than ten countries around the globe. It has over 130 property projects in the world and 7 of them are located in Shanghai.
Then how does this European property development giants get to know China? Applerot remembered that GTC Real Estate China was always looking for proper markets in the world and fixed its eyes on China in 2004 after making surveys. At that time, the property market in the major cities of China have already been full with a little space left for GTC Real Estate China, which quick-wittedly sensed the great potential in the second- and third-tier cities of China. In 2005, GTC Real Estate China made an official entry into China.
From then on, GTC Real Estate China began its investment in the second- and third-tier cities of China and fortunately, had a harvest– it had acquired 9 slots of land in Shenyang, Xianyang, Chengdu, Changzhou, Hangzhou and Dalian.
Three Ways of Doing Business
What made a foreign property company like GTC Real Estate China get into China, establish itself and had the development of that size in as short as seven years. Applerot recounted its“method of doing business” in China.
GTC Real Estate China’s boom in China is not accomplished within one night; instead, it was divided into three phases, each of which is featured with the firm control of the company and marvelous gains. “In the initial phase, we worked with local property developers. They taught us about how to get familiar with local working procedure, how to maintain the relationship with the government and so on. The cooperation with them also provided us with a lot of new opportunities,” Applerot thought back.“The second phase was featured with some of our self-operated projects, such as the Galleria Chengdu, our first independent commercial center in 2007. High-end European brands, theatres and other stores were opened in this building, which was awarded with the ‘Best Retail Project of China’ in 2011.” Speaking of that, Applerot did not even try to hide his excitement and pride.
Now GTC Real Estate China is in the third phase, in which it needs to operate the commercial projects it developed. “Presently our projects are only for lease instead of sale. This operation pattern gives us the revenue that increases year by year,” Applerot said.
In Applerot’s opinion, the company’s success in China is attributed to the adherence to three principles of doing business. “The first one is to attach importance to the long-term plans. Different from other listed companies which oversee the returns on a quarterly basis, we see our returns every five or ten years. We think that the commercial property is our advantage and we only choose land slot with commercial features. The value of these projects will increase year by year and gives shareholders a long-term revenue. The second one is the mere investment in emerging markets, i.e. the second- and thirdtier cities. These markets are mostly empty and with great development potential. The third one is that our identity as a foreign company requires us to hunt down both international senior executives and local Chinese employees so we can combine the international management experiences with the familiarity with local markets, culture and policies to lower the risk.”
Anti-trend Investment with Good Prospect
Due to the current depression of China’s property market, many foreign developers chose to quit with the cash. But GTC Real Estate China chose a different path – its investment strategy in China was not affected at all; instead, it increased its investment amount and force. Even the international financial crisis in 2008 and the earthquake in Wenchuan could not scare GTC Real Estate China away.
Applerot remembered that many foreign investors stopped their investment in Sichuan after the earthquake in Wenchuan. GTC Real Estate China was not one of them. With the belief that the real estate project would thrive again, it increased its investment in this area. Again, when the international financial crisis swept the world, GTC Real Estate China successfully stepped into Dalian, which had a rising fame as an investment destination at that time. In addition, when the Chinese property market waned in 2008, it intensified its investment in this country and bought four land slots in that year.
Applerot never wavered in the investment in China. The confidence is not only shown in property business, but also reflected by another business it is engaged in – the water conversancy projects. In 2007, Kardan Water International Group under Kardan Group stepped into China and has already established 12 water disposal and operating projects in the drainage areas of Huai River and Yangtze River. “These projects helped local governments a lot in solving the water problems and also gave us some opportunities to get land,” said Applerot.
Applerot confirmed that GTC Real Estate China will not leave the Chinese market. “GTC Real Estate China is the fastest growing company under Kardan Group and it is mainly based on the business in China.” Though Applerot never disclosed the detailed data, but he said firmly that the proportion of its Chinese business in the global business will be bigger and bigger. Against the European debt crisis, the company will consider placing more projects in China as its development strategy emphasizes on.
GTC Real Estate China is still increasing its presence in the second- and third-tier cities in China. Applerot said: “GTC Real Estate China’s team began to visit the second- and third-tier cities of China on a weekly basis to look for cities with potential like Dalian and Chengdu that can provide more opportunities.”
“Now there is an opportunity. We’ve been bullish on the Chinese market for long and hope to further increase the weight of our business in this Chinese,” said Erez Applerot, CEO of GTC Real Estate China, the largest real estate company in Middle and East Europe. He showed his confidence in investing in China and established their presence in Chengdu, Dalian and other second- and third-tier cities of China. In Applerot’s opinion, China is already a part of the company’s development plan and its unusual path in China is to develop in the second- and third-tier cities of this country.
Seven Years’ Development
GTC Real Estate China is a subsidiary company of Holland-headquartered Kardan Group. It began to get engaged in the real estate development business from 1994 and is the largest real estate developer in Middle and East Europe. Presently GTC Real Estate China has business in more than ten countries around the globe. It has over 130 property projects in the world and 7 of them are located in Shanghai.
Then how does this European property development giants get to know China? Applerot remembered that GTC Real Estate China was always looking for proper markets in the world and fixed its eyes on China in 2004 after making surveys. At that time, the property market in the major cities of China have already been full with a little space left for GTC Real Estate China, which quick-wittedly sensed the great potential in the second- and third-tier cities of China. In 2005, GTC Real Estate China made an official entry into China.
From then on, GTC Real Estate China began its investment in the second- and third-tier cities of China and fortunately, had a harvest– it had acquired 9 slots of land in Shenyang, Xianyang, Chengdu, Changzhou, Hangzhou and Dalian.
Three Ways of Doing Business
What made a foreign property company like GTC Real Estate China get into China, establish itself and had the development of that size in as short as seven years. Applerot recounted its“method of doing business” in China.
GTC Real Estate China’s boom in China is not accomplished within one night; instead, it was divided into three phases, each of which is featured with the firm control of the company and marvelous gains. “In the initial phase, we worked with local property developers. They taught us about how to get familiar with local working procedure, how to maintain the relationship with the government and so on. The cooperation with them also provided us with a lot of new opportunities,” Applerot thought back.“The second phase was featured with some of our self-operated projects, such as the Galleria Chengdu, our first independent commercial center in 2007. High-end European brands, theatres and other stores were opened in this building, which was awarded with the ‘Best Retail Project of China’ in 2011.” Speaking of that, Applerot did not even try to hide his excitement and pride.
Now GTC Real Estate China is in the third phase, in which it needs to operate the commercial projects it developed. “Presently our projects are only for lease instead of sale. This operation pattern gives us the revenue that increases year by year,” Applerot said.
In Applerot’s opinion, the company’s success in China is attributed to the adherence to three principles of doing business. “The first one is to attach importance to the long-term plans. Different from other listed companies which oversee the returns on a quarterly basis, we see our returns every five or ten years. We think that the commercial property is our advantage and we only choose land slot with commercial features. The value of these projects will increase year by year and gives shareholders a long-term revenue. The second one is the mere investment in emerging markets, i.e. the second- and thirdtier cities. These markets are mostly empty and with great development potential. The third one is that our identity as a foreign company requires us to hunt down both international senior executives and local Chinese employees so we can combine the international management experiences with the familiarity with local markets, culture and policies to lower the risk.”
Anti-trend Investment with Good Prospect
Due to the current depression of China’s property market, many foreign developers chose to quit with the cash. But GTC Real Estate China chose a different path – its investment strategy in China was not affected at all; instead, it increased its investment amount and force. Even the international financial crisis in 2008 and the earthquake in Wenchuan could not scare GTC Real Estate China away.
Applerot remembered that many foreign investors stopped their investment in Sichuan after the earthquake in Wenchuan. GTC Real Estate China was not one of them. With the belief that the real estate project would thrive again, it increased its investment in this area. Again, when the international financial crisis swept the world, GTC Real Estate China successfully stepped into Dalian, which had a rising fame as an investment destination at that time. In addition, when the Chinese property market waned in 2008, it intensified its investment in this country and bought four land slots in that year.
Applerot never wavered in the investment in China. The confidence is not only shown in property business, but also reflected by another business it is engaged in – the water conversancy projects. In 2007, Kardan Water International Group under Kardan Group stepped into China and has already established 12 water disposal and operating projects in the drainage areas of Huai River and Yangtze River. “These projects helped local governments a lot in solving the water problems and also gave us some opportunities to get land,” said Applerot.
Applerot confirmed that GTC Real Estate China will not leave the Chinese market. “GTC Real Estate China is the fastest growing company under Kardan Group and it is mainly based on the business in China.” Though Applerot never disclosed the detailed data, but he said firmly that the proportion of its Chinese business in the global business will be bigger and bigger. Against the European debt crisis, the company will consider placing more projects in China as its development strategy emphasizes on.
GTC Real Estate China is still increasing its presence in the second- and third-tier cities in China. Applerot said: “GTC Real Estate China’s team began to visit the second- and third-tier cities of China on a weekly basis to look for cities with potential like Dalian and Chengdu that can provide more opportunities.”