In the past year, the property management industry as a whole has been in a period of adjustment.
In the process of actively seeking change, property management enterprises are still facing many problems such as the capital market has not bottomed out, the revenue growth rate of listed property enterprises has continued to slow down, the overall satisfaction of property management has declined, and the optimization and streamlining of enterprise organizations have been faced.
In the future, the property management industry will enter an era of low-speed growth, and some new changes may occur in the industry's business model, enterprise competition pattern, and capital market valuation. On the whole, the scale of the property management industry will be stable in the next three years, and the industry will return to the "meager profit + cash flow" model.
In the next three years, the overall scale of the property management industry will be stable.
From 2023 to 2026, it is estimated that the revenue scale of the property management industry will steadily increase from 3,839.6 billion yuan to 4,337.3 billion yuan, and the revenue increase of the property management industry in the next three years will be about 500 billion yuan, with an average annual growth rate of between 3% and 5%.
Among them, the revenue scale of basic services increased by about 256.5 billion yuan, and the revenue scale of value-added services increased by about 241.2 billion yuan.
Basic Service Increment**New Increment and Stock Socialization. In the next three years, the revenue of basic services in the property management industry will increase by about 256.5 billion yuan. Among them, the revenue increase of basic services driven by new industrial parks, residential projects and other business projects was about 148.1 billion yuan, accounting for 58%.
With the continuous improvement of the socialization rate of property services in urban services, public construction and other formats, the revenue of basic services may increase by 108.5 billion yuan, accounting for 42%.
In 2020, the property sector ushered in a highlight moment, and the capital market gave a high valuation, but due to the involvement of the real estate industry, the overall valuation level of the property sector fell sharply, and the strategic focus of property enterprises shifted to quality growth, while the industry entered the "meager profit" mode.
The net profit margin of typical head and third-party property enterprises is between 5% and 10%. In the first half of 2023, the gross profit margin of typical head and third-party property companies will generally be less than 20%, and the net profit margin will be mostly between 5% and 10%, which also means that the property management industry has entered the "meager profit" mode.
With the decline in the collection rate of property fees, the increase in labor costs, and the increase in the age of the project, the net profit margin may continue to decline.
There is a significant gap between the waist and the head enterprises.
First, focus on the scale base reflected by the area of the tube. In the first half of 2023, the average area under management of leading property enterprises will be as high as 5100 million square meters, the average area of waist property enterprises under management is 1800 million square meters, the gap between the scale base of the waist and the head property enterprise is obvious.
Secondly, from the perspective of reserve transformation capacity reflected by the reserve area. In the first half of 2023, the average reserve area of leading property enterprises will be as high as 3100 million square meters, the average reserve area of waist property enterprises is 0700 million square meters, indicating that there is also a significant gap between the waist and the reserve transformation capacity of the head property enterprises.
Finally, the expansion ability of enterprises is measured based on the area under management of new third parties and the remaining M&A amount. In the first half of 2023, the average area of new third-party under management of leading property enterprises will be 26.81 million square meters, and the average area of new third-party under management of waist property enterprises will be as low as 3.38 million square meters; The average remaining M&A amount of the head property enterprises was 1.9 billion yuan, and the average remaining M&A amount of waist property enterprises was 5900 million yuan, which intuitively reflects that there is a large gap between the waist and the head of the property enterprise investment and expansion capabilities.
The long tail persists.
According to the classification standards of the property management industry, micro, small and medium-sized enterprises with less than 1,000 employees or operating income of less than 50 million yuan are micro, small and medium-sized enterprises, and micro, small and medium-sized enterprises happen to highly overlap with non-top 500 property enterprises.
Focusing on this kind of tail enterprises, there are many typical characteristics in the following three aspects: First, cost advantage, that is, small and high-quality third-party property enterprises that entered the market earlier. Second, it is relational, involving unit restructuring property enterprises, village-run property enterprises, small and medium-sized developer-related property enterprises, logistics socialized property enterprises, etc. Third, professional services, including schools, hospitals and other professional line small property enterprises, as well as special subcontracting business undertakers.
The competition pattern of head and tail property enterprises is relatively stable.
In the property management industry, the revenue scale of 5 billion yuan seems to be a relatively difficult gap to cross, only more than ten property enterprises can reach the range of 50-10 billion yuan, and the revenue scale of more than 10 billion yuan is very few.
In stark contrast, there are more than 100,000 mosquito-type property enterprises with a revenue scale of less than 20 million yuan, and the projects under management are generally in single digits, and there are also many property companies with only 1-2 projects under management.
There is still an opportunity for waist property enterprises to jump. In the policy environment of deepening the reform of state-owned assets and state-owned enterprises, state-owned enterprises are expected to become stronger, better and bigger through integration. Based on different levels of integration, those state-owned enterprises with revenue scale of 1-1 billion yuan may enter different levels, and the revenue scale will also reach a new level.
Under the guidance of the policy baton of deepening the reform of state-owned assets and state-owned enterprises, more state-owned enterprises may accelerate their integration, and the proposed integration path in the future will focus on the following two forms: First, the integration of affordable housing and housing reform property enterprises. Second, central enterprises integrate urban companies scattered across the country.
Invest effectively, grasp the "feeling service", and keep an eye on blind spots, pain points, and itchy points.
For property enterprises, improving satisfaction is not to take care of all property services, but to focus on the blind spots, pain points and itching points of property services, and provide targeted solutions.
The property management company implements routine services to a high standard, and the blind spot area must also maintain the frequency of cleaning operations and meet the corresponding cleanliness standards. In view of the pain points related to the vital interests of property owners, such as personal safety, property safety, housing problems, and neighborhood relations, it is recommended that property management companies pay close attention to the "three degrees", that is, attitude, speed and progress. In response to itching, property companies mobilize more owners to participate in community activities and create a peak itching experience in order to stimulate the enthusiasm of owners to spread.
Affected by various factors such as the continuous thunderstorm of real estate related parties, the difficulty in recovering accounts receivable, and the large amount of impairment provisions, in 2023, the property management industry will be reorganized, and the average PE of listed property enterprises will be about 113 times.
It is expected that 2024 will still be a consolidation year, and the average valuation of listed property companies may fluctuate in a narrow range within a certain range. With the orderly clearance of unfavorable factors in the industry, the average valuation of listed property enterprises is expected to recover slowly.
From a micro point of view, the capital market is more positive than negative.
First of all, 85% of the stock prices of property companies have undergone a round of relatively large adjustments, and there is limited room for further downward adjustment. Secondly, the operational independence of some property enterprises has been enhanced. Third, the strategic focus of property enterprises has shifted from focusing on scale to focusing on cash flow and profitability, and has taken measures such as eliminating some inferior projects and reducing the proportion of related party business, and the high-quality cash flow attributes of the property management industry itself are favored by capital. Fourth, the listing of state-owned enterprises may increase the overall valuation level of the property sector.
The pattern of the property management industry has stabilized, and in the future, under the policy environment of deepening the reform of state-owned assets and state-owned enterprises, the revenue scale of the industry will reach a new level, and the valuation will also be consolidated and slowly rebound. For the property management industry, it is still the key to development to meet the blind spots, pain points and itching points of all owners through effective investment, and to improve satisfaction. (*Ding Zuyu commented on the property market).
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