Author: Song Xi Location Selection 960

1422 words in full text, about 3 minutes to read

Recently, market rumors spread that "the first stock of urban renewal," Jinhe Commercial Management, acquired the Chuangyi MIX·Anbo Road commercial project under Shanghai Chuangyi at a price of 460 million yuan.

It is reported that the project is located at No. 439 Anbo Road, Yangpu District, Shanghai, with an area of 6,000 square meters and a gross floor area of 18,000 square meters. It is positioned as a community-based commercial and office complex, including two major functional formats: community commerce and quality office space.

Project Information Image source: Baidu Map

Chuangyi MIX·Anbo Road is an urban renewal property initiated and constructed by Shanghai Chuangyi Industrial Co., Ltd. It is also Chuangyi's first planned product positioned as a mixed-use development, aiming to create a new model of the "15-minute living circle." Currently, the project is shown as "under renovation" on Baidu Map.

Shanghai Chuangyi Industrial Co., Ltd. is an urban renewal operator that has been promoting the commercial operation of old building renovation projects since its establishment in 2007. The company's slogan is: "Centered on urban renewal, reshape and optimize the value of existing assets." In 2021, Chuangyi launched three major urban renewal projects: Chuangyi MIX·Anbo Road, Xiansuo·Chuangyi MIX, and Chuangyi MIX·Luoxiu Road. According to the official website, both Xiansuo·Chuangyi MIX and Chuangyi MIX·Luoxiu Road are already open, while Chuangyi MIX·Anbo Road is not yet introduced.

Image source: Shanghai Chuangyi Industrial Co., Ltd. official website

Data shows that Chuangyi has successfully developed 30 projects in Shanghai's core urban areas to date, with a total volume of 410,000 square meters.

According to online rumors, the buyer of the Chuangyi MIX·Anbo Road project in this transaction is Jinhe Commercial Management.

Founded in 2007, Jinhe Commercial Management is a company primarily engaged in asset-light operational services. Its main business includes the positioning, design, renovation, leasing, operation, and service of urban aging properties and inefficient existing commercial properties. In 2020, Jinhe Commercial Management was listed on the Shanghai Stock Exchange and is known in the industry as "the first stock of urban renewal" and "the first stock of asset-light operations." Financial data shows that in the first half of this year, Jinhe Commercial Management achieved operating revenue of 518 million yuan, an increase of 4.01% year-on-year; net profit attributable to shareholders was 23.22 million yuan, a decrease of 72.83% year-on-year. As an asset-light operation company, the news of this transaction immediately attracted widespread attention and discussion in the industry as soon as it was released.

However, soon afterward, the relevant person in charge of Jinhe Commercial Management refuted this rumor to the media. The person in charge stated that the Chuangyi MIX·Anbo Road project, which was rumored to be acquired, was actually acquired jointly by Jinhe Asset Management and other institutions.

Public information shows that Jinhe Asset Management is an asset management company jointly established by Warburg Pincus, a leading global private equity investment institution, and Jinhe Group. The company focuses on investing in existing properties in core locations such as Shanghai and Beijing. By tailoring investments, development, renovations, ownership operations, and full-cycle asset management to local conditions, it aims to become a leading platform in the field of urban renewal. It belongs to the same Jinhe Group subsidiary as Jinhe Commercial Management. Currently, Jinhe Asset Management owns 19 self-owned properties with an asset management scale exceeding 15 billion yuan and plans to reach a scale of 50 billion yuan within the next three years.

It is also worth mentioning that the person in charge revealed that Warburg Pincus, a private equity investment group, has not only invested in Chuangyi but also partnered with Jinhe Group to establish Jinhe Asset Management. Nowadays, urban renewal is gaining increasing popularity. In recent years, as growth has slowed, commercial real estate players have turned their attention to urban renewal, and favorable policies have also opened up new opportunities for urban renewal.

Against this backdrop, many renovation-and-upgrade projects have gained popularity in the market.

For example, earlier this year, chip company Fengtao Technology acquired a small yet beautiful standalone building in Shanghai Hongqiao International Business District for 130 million yuan, which is a benchmark urban renewal project managed by Landsea Properties. In the Beijing market, Great Wall Life Insurance acquired Xinjie Gaohe Property for 1.02 billion yuan, which is also a typical urban renewal project. Policy-wise, in June this year, the Ministry of Finance of China announced a list of cities that will soon launch urban renewal initiatives, including Shanghai, Hangzhou, Chengdu, and 12 other cities. Subsequently, urban renewal has frequently appeared in official statements from different ministries and commissions.

On July 31, the State Council issued the "Five-Year Action Plan for In-Depth Implementation of the People-Oriented New Urbanization Strategy" (Guo Fa [2024] No. 17), further outlining specific requirements for urban renewal.

Zheshang Securities estimates that urban renewal is expected to drive over 15 trillion yuan in investment during the 14th Five-Year Plan period.