Long-term rental apartment: I don't make money, but I want to go public

Apartment long-termrentalapartment

touzhongwang· 2019-10-31 09:26:17

The long-term rental capital city's capital market debut, was the first in the industry.

文| 银昕

The long-term rental apartment capital market debut, was the first in the industry.

Overtaking and eggshells, Tsinger Apartment took the lead in submitting a prospectus in the United States on October 7. If there is no accident, the Greenhouse Apartment will be listed on Nasdaq on November 5th. Listed, the stock code is "QK", and plans to raise $100 million.

After the Qingke Apartment "running", the long-rental apartment boss, Xiong Lin, was conservative about the listing. "The first priority for the current and future period of time must be to deepen the company's products, services, technology, and team to enhance the user experience and make life better. So we will not rush to start an IPO, and there is no clear timetable."

The head of the Rubik's Cube apartment, another long-term rental agency in China, also said to the investment network-PropTech Institute, "We chose a calm route and don't talk about listing." p>

Although the IPO is successful, Qingke Apartment will be the first to list the top two giants in the long-term rental apartment, but the prospectus of Qingke Apartment allows practitioners to see a little worry: this industry The first share, the road to profit is still very long.


industry third Prospectus

Each rent is 4,000 yuan per rent

Since its establishment in Shanghai in 2012, Qingke Apartment has experienced four financings.

According to CV Source data, Qingke Apartment Angel Wheel Investment was completed by Newport Venture Capital, and the investment amount was not disclosed. After three rounds of financing from A, B and C, the total financing of Qingke Apartment has been More than 100 million US dollars, in addition to New Zealand Venture Capital, there are Morgan Stanley, Safran Investment and Dachen Venture Capital.

After receiving capital support, Qingke Apartment began to expand rapidly and has entered six cities by the end of 2018. The rentable houses of Qingke Apartment also expanded from 940 at the beginning of 2012 to 91,234 rooms at the end of 2018, and nearly 100 times expanded in 6 years.

In addition to the speed of expansion, there are several figures in the Greencomer's prospectus that deserve attention.

The first is 65.2% of the rental loan frequency, which contributed 790 million yuan to the rent pool.

The Tsinghua Apartment prospectus shows that by the end of June 2019, 65.2% of the Tsinghua apartment tenants had used rental loans. If all tenants are prepaid for a full year of rent, according to the average monthly rent of 1,100 yuan, the 65.2% of the tenants will contribute a total of more than 1 billion yuan to the rent pool. According to the prospectus of Qingke, by the end of June 2019, the total prepaid rent of Qingke Apartment was 790 million yuan.

Second, the prospectus shows that Qingke has lost more than 4,000 yuan per house.

The net income of Tsingke Apartment in FY 2018 was 890 million yuan, with a loss of 500 million yuan; the first 9 months of FY 2019 (ending on June 30) had a net income of 900 million yuan and a loss of 370 million yuan.

Investing in the article "Every time I rent a room, loss of 3,800 yuan long-term apartment IPO, the speed of life and death" has been analyzed in this article: according to the end of 2018, the number of Qingke has a total of 91,234 houses, each rented one Greenhouse customers have to lose more than 4,000 yuan. According to a total of 97,621 tenants as of June 30, 2019, Qingke has an average loss of more than 3,790 yuan per tenant; compared with 2018, More, each home has a loss of more than 5,000 yuan.

It is worth noting that a loss of 4,000 yuan per house was generated at a low vacancy rate, which made people have to question the rigor of the overall business logic of the Tsinghua apartment.

The average monthly occupancy rate of Qingke Apartment in 2017 and 18 years is 91.6% and 92.4%, 90% is the target occupancy rate set by Qingke Apartment, which is between 2017 and 2018. The indicators have exceeded their target occupancy rate, and the goal of exceeding 90% of the target is still losing so much. What should I do in the future? .

The third notable number is the renewal rate.

The Greencomer Prospectus shows that for the first 9 months of FY 2019 (until June 30, 2019), the contract period between the tenant and the Green Guest Apartment is an average of 11.7 months. 47.3% of tenants retired in advance, and the renewal rate was only 5.1%.

One side is the aura of the long-term rental apartment, and the other side is the embarrassing performance of financial data. It is no wonder that the industry boss second quietly pressed the listing suspension button. The problems in front of the Green Apartment are not limited to these, and there are deeper obstacles that make these long-term apartment players feel like they are in the throat.


Rent rights are not Stable

"Second landlord" Legal status 尴尬

It is only the end result that it is difficult to make a profit. Another problem with long-term rent apartments is that their legal "two-host" status leads to their rent. Hard to stabilize.

Chen Fangyong, Dean of Chengzhi Renewal Research Institute, told the Investment Network-PropTech Institute that after the advent of the “stock” era of the real estate industry, the real estate market has changed from “incremental economy” to “the current era”. The stock economy has become the consensus reached by most practitioners. The era of building a house to sell a house and getting sufficient cash flow in the short term has passed. Nowadays, it can only earn low money and earn small money with the support of refined operational capabilities. .

" Our thinking must be changed from building a house to selling a house. This is the living space of the so-called 'two-room east'." Chen Fangyong said.

However, the process of this transformation is bound to be tortuous. In the previous market, when the market was booming at the huge profit of "ownership", in the operation right of "two landlords", neither the legal status nor its commercial status received sufficient attention and protection. "Second Fangdong" was always in a small position. The status of a daughter-in-law. "The right to oppress the right to operate, the 'two landlord' rental rights are unstable" has been accompanied by the development of long-term rental apartments.

There is no lack of policy to use the leasing business including long-term rental apartments to revitalize existing stocks. One example is the "commercial change".

The reference to allow "business to rent" begins in May 2016. On July 17, 2017, the General Office of the Guangzhou Municipal Government issued the “Work Plan for Accelerating the Development of the Housing Leasing Market in Guangzhou”. At that time, the public opinion focused on the “rental purchase and the same right” and ignored the “business reform” proposed at the same time. Renting, that is, allowing commercial houses to be converted into leased houses according to regulations, the houses that have been rebuilt after approval by the planning administrative department, the land use period remains unchanged, and the adjusted water, electricity and gas prices are implemented in accordance with resident standards.

After Guangzhou, Shanghai, Nanjing, Foshan and other places also issued a document to allow "business to rent", and Nanjing also proposed to convert idle and inefficient use of state-owned factories into rental use.

The direct result of this policy is that the "two-room owner", including the long-term rental apartment and the joint office model, has the opportunity to rent more stock assets and lower rental costs. However, after careful analysis, the industry believes that this matter is not so simple.

The head of a long-term rental brand in the background of a developer once told the reporter of the Investment Network-PropTech Institute that the stock property will be transferred to the "two-room owner" for the purpose of holding the stock property. The "big landlord" of ownership is not the best choice. Around 2017, projects in the construction and commercial offices of Beijing and Shanghai were affected by the purchase restriction order, but their early development investment was based on the cost of normal commercial projects, even if long-term rental institutions were willing to rent and convert them into residential forms. That means paying another part of the cost. These costs are exchanged for the long-term lease, which cannot effectively and quickly form a stable cash flow. It is not a cost-effective business to change from "making big money" to "making fast money" to "making small money" and "slowing money".

In addition, in the disputes of the right to operate and ownership, the game between "big landlord" and "two-roomlord" has always existed, and both are working hard to maximize their commercial interests.

The long-term rental agency may indeed have some fine-grained operations. This part of the chip called "professional ability" seems to be worthy of the "big landlord" in the long-term rental agency, and it is also the "big landlord". "The ability to access is not easy. However, for the "big landlord", in the case that the legal status of the "second landlord" has not been stabilized, once it is found that "the second landlord" can obtain considerable profits at the level of operation rights after renting the property, it is motivated. And the conditions to take the means to recover the property or renegotiate the rental price, increase the cost of "two landlords."

The head of a long-term rental agency in China confirmed to the investment network-PropTech that it had indeed been driven out of the property by the "big landlord" after the lease was not expired. The situation, "The reason is not clear, but such incidents are not the first time in the peers. Dealing with the relationship with the big landlord is indeed a problem."

But he also said that with the rule of law The level is more clearly defined by the rights and obligations of both the property rights and the tenancy rights. He believes that such things will be less and less, and the stability of the tenancy will become stronger.


Long rent is A normal business

is not financial

The tenancy of legal status is unstable, and the long-term position of the right to operate has made some long-term apartments financially "reluctant" The breakthrough of growth. In addition, due to the stable and long-term profit rhythm, the long-term rental industry seems to have been “cast” from a birth to a strong financial attribute.

A head of a long-term domestic long-term rental agency once said to the investment network-PropTech Institute that if the long-term rental industry can obtain stable rental income, stable customers and stable leases Very suitable for using financial instruments.

The head of the long-term rental brand in the above-mentioned developer background told the Investment Network-PropTech Institute: "Real estate developers are very interested in the liquidity of cash and are reluctant to lock large amounts of cash for a long time. On several fixed projects, this conflicts with the rapid return of funds pursued by real estate developers."

This is the true attitude of Chinese real estate developers to long-term rental apartments: on the one hand, they know that they are future industry trends. On the other hand, because there is no exit mechanism that is given by effective financial instruments, it is unwilling to invest too much in the long-term rental industry and affect the speed of withdrawing funds.

In this context, financial instruments are even more important.

In terms of asset securitization, two ABSs that have been released so far, Rubik's Apartments have also issued two ABSs, and New Apartments and Poly also issued "Class REITs" in 2017. China has not yet launched public offerings of REITs, and REITs that can be sold in the public securities market, CITIC, Singapore and Poly “REITs” are only available for sale to specific financial and investment institutions.

There has been a call for "true REITs" since 2017, but no loose policy has been seen so far. Some analysts believe that the current national policy is so tight for the influx of cash into real estate, "true REITs" are far from infinite.

However, this does not affect other financial instruments such as rent lending for long-term rental apartments that are interested in rapidly expanding their territory. Nanjing Lejia, Hangzhou Dingjia, and the apartment are not the victims of financial means.

The financial play of long-term rental apartments is mainly "time mismatch" and mortgages of tenants' credits to financial institutions to lend to financial institutions. The monthly rents are essentially in the future. Financial institutions pay back.

The wishfulness of the "period mismatch" is to allow the tenant to pay the rent for half a year or one year through lending, and the long-term renter pays the landlord only three months or half a year. A steady stream of tenants can rent, and the vacancy rate is low and the tenant's liquidity is large enough to make a profit.

The "permanent" of mortgage lenders to financial institutions is that tenants have no other physical objects or property to pledge, and only personal credit can be placed.

The situation of long-rental apartments has been repeatedly thundering. For example, in the case of Lega Apartment, which was declared bankrupt in August 2019 and caused tens of thousands of tenants to have no room to live in, in addition to the "mismatch of maturity", the house was realized by "high buy and low sell". Rapid expansion, once the "term mismatch" is still unable to obtain a stable source of customers, the vacancy rate can not be controlled at a very low level, and its income can not fill the gap caused by "high buy and low sell", and thunderstorms are logical.

"High buy and low sell" has given the industry a particularly profound lesson. In the announcement issued by Lejia Apartment at the time of bankruptcy, it was said that after careful reflection, the company’s "high-in and low-out" was deeply recognized. There are huge shortcomings in the form of operation, which has brought great danger to the long-term rental market.

Tianjin Vanke spokesperson Zhao Wei is on the net -PropTech Institute said that Vanke never considered financial means when it came to do the housing project. The rent loan was a negative list that was firmly touched. The apartment also never thought that the long-term rental apartment was a financial business. "We feel that using financial means is extremely dangerous. Long-term rent is a normal business, not financial."

Zhao Wei said that "low buy and sell high" "time mismatch" will not It is a way of thinking about parking. "The first thing we consider is cost, especially the cost of getting the property and the cost of the decoration, and only do centralized, not decentralized. After the model is measured, if a project is almost fully rented. If we still can't make a profit, we won't do such a business." Zhao Wei also revealed that the only thing that Po Yu can do is to make renovation loans in the decoration, but not to rent loans.

After the listing of Wework, the originator of the joint office industry, the other runners in the track were affected, and the business logic of the joint office format was also suspected. If the prospectus of Qingke Apartment cannot be exchanged for recognition in the capital market, does it have a significant impact on the long-term rental industry?

"The long-term rental industry has not found a stable profit point so far. The release of the prospectus by Qingke only means that the matter has just started, and it is still unknown whether it will be successfully listed. Now it is judged that it is for the long-term rental industry. The overall impact is still too early." Guo Yi, chief analyst of Heshuo, analyzed this.

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