The Zhitong Finance App learned that the China Index Research Institute recently released “Top 50 New Contract Areas for Chinese Property Service Companies in March 2024", “Top 50 Third-Party Market Expansion for Chinese Property Service Companies in March 2024", and “Top 50 Property Service Companies Undertake Related Areas in March 2024". In March 2024, TOP50 companies added a total contract area of about 112.48 million square meters; the average new contract area was 2.25 million square meters. Among them, China Resources Vientiane Life Co., Ltd. (01209), Yuexiu Service Group Co., Ltd. (06626), and Longhu Property Service Group Co., Ltd. expanded rapidly, adding more than 6.5 million square meters of contract area.

1. Third-party market expansion analysis of property service enterprises in March 2024

In March 2024, the total third-party market expansion area of TOP50 property service companies was 95.89 million square meters, with an average value of 1.92 million square meters. Among them, the top two companies are China Resources Vientiane Life Co., Ltd. and Yuexiu Service Group Co., Ltd., with third-party market expansion areas of 7.09 million square meters and 6.85 million square meters respectively.

In terms of hierarchy, the average third-party market expansion area of TOP10 companies is 4.76 million square meters, and the average third-party market expansion area of TOP11 to TOP30 companies is 1.85 million square meters.

2. Analysis of the area of property service enterprises undertaking related areas in March 2024

As China's “security and handover” work continues to advance steadily, the results are showing. The sales area of related parties of a property service enterprise is generally converted into the contract area of the property service enterprise, thus forming an endogenous increase in scale. Based on the sales area of commercial housing added by property companies to undertake related development companies in March 2024, the China Index Property Research analyzes the volume situation of property service companies undertaking related areas.

In March 2024, the TOP50 companies undertook a total of about 20.43 million square meters in related areas. Among them, the average management area of the TOP50 enterprises added to the relevant parties reached 410,000 square meters, and the threshold value of the TOP10 enterprise area to be converted was 620,000 square meters.

Undertaking projects from brother companies is an important means of expanding the scale of property management companies. Leading companies such as CNOOC Property Management Co., Ltd. and Poly Property Service Co., Ltd. will add more than 1.7 million square meters of management area with the support of parent companies and related parties. Relying on the development of related housing enterprises, the stability of the growth in the management area of property service enterprises is strongly guaranteed.

3. Analysis of the property service enterprise merger and acquisition market in March 2024

The strategic development of property service enterprises has become more prudent and pragmatic

According to data monitoring by the China Index, no mergers and acquisitions were detected in March 2024. Since 2023, the industry's M&A market has cooled down further. Typical mergers and acquisitions that disclose relevant information involve a transaction amount of about 1.9 billion yuan, a sharp drop of about 74.67% compared to 2022. After taking stock, we found that the first, most intuitive change is that the amount of mergers and acquisitions cases is generally small, with the vast majority not exceeding 100 million yuan, indicating that enterprises are more cautious in dealing with mergers and acquisitions. Some listed companies changed the original use of listed capital for mergers and acquisitions, and proposed clear standards for mergers and acquisitions to ensure the quality of mergers and acquisitions and control the risks of mergers and acquisitions. Second, “large-scale” mergers and acquisitions have declined, and “business-type” mergers and acquisitions are popular and target mainly focus on sanitation, catering, and technology companies.