Municipal services

Shimao Services implements major strategies and launches municipal service manager to improve quality and efficiency

In October 2020, Shimao Services Holdings Limited (“Shimao Services” or the “Company”; stock code HKEX: 873.HK), one of the leading providers of comprehensive property management and community life services in China, was listed on the Hong Kong Stock Exchange and successfully embarked on a new journey in the capital market. By developing its comprehensive property management services, its diversified value-added services and its smart city services, the Group has achieved quality growth.

Shimao Services is positioned as one of the leading providers of comprehensive property management and community life services in China. With its brand concept focused on “better smart living”, Shimao Services is committed to becoming one of the leading comprehensive city living service scenario providers in China. In addition to continuing to develop its activities in comprehensive property management, diversified value-added services, smart city services and digital technologies, it also aims to become one of the main players in the real estate services industry. ‘by 2023.

Implements five major strategies, including “1 + 1 + X”
The resources and market shares of the real estate services industry are gradually focusing on market leaders, with competition within the industry becoming increasingly intense. Based on the current situation of the Company, as well as the evolution of the market, Shimao Services has meticulously developed its roadmap and implemented five strategies, including “1 + 1 + X” (associated diversification), integration horizontal, vertical integration, centralization and updates. .

Take “1 + 1 + X” as an example. The first “1” refers to global properties, including residential buildings, college campuses, and other types of global businesses. The second “1” refers to value-added community services and “X” to city services. However, there might be more opportunities available in the future. Shimao Services follows a clear value investing philosophy and expands its reach through cooperation as part of its horizontal integration strategies. Priority will be given to cooperation agreements with regional leaders and niche market leaders. “We are covering one platform with another platform, to achieve the ‘1 + 1> 2’ effect through the cooperation of both parties,” said Ye Mingjie, executive director and chairman of Shimao Services.

The vertical integration strategy, on the other hand, opens up multiple types of services, such as housing, schools, hospitals, “SUNIT” and educational establishments. While developing several activities simultaneously, Shimao Services proposed a centralized strategy to strengthen the development of its businesses in five key cities: Hangzhou, Wuhan, Xi’an, Tianjin and Fuzhou. Take the example of Hangzhou. After cooperating with Zheda Sinew and Jinhu Property, the company again partnered with Yefeng Property to further increase the market density and concentration of Hangzhou and improve the overall capabilities of a single market.

As for the update strategy, this is the final stage of Shimao Services’ post-investment integrated management plan and focuses on further upgrades of its organizational capacities and management mechanism; continuing to improve the capabilities of its professional segment; and strengthening of the coordination mechanism for the expansion of the project. In August 2020, Shimao Services worked with Zheda Sinew and then implemented their renewal strategy within the company. On May 9, Zheda Sinew improved its brand image and launched the “Yulin Campus Service Ecology”. Shimao Services has positioned it as the leading provider of college campus services in China, reflecting the Group’s strategies of vertically developing the college campus market, consolidating its superior resources, and enhancing business growth.

A municipal service manager focused on promoting four core businesses
Municipal Services, an ideal area for exploring the scope of services and demonstrating full service capabilities, is seen as a new blue ocean in the realm of property management. By leveraging its strong and comprehensive service capabilities, Shimao Services expanded into municipal services and quickly made inroads. In this year’s interim report, municipal services for the first time became one of the four main business segments of Shimao Services and began to demonstrate their outstanding potential, bearing fruit in many parts of China. In the first half of 2021, the revenue from the municipal service activities of Shimao Services reached 134 million RMB.

Shimao Services sees municipal services as a new strategic engine for the growth of its business and therefore positions itself as a manager of municipal services to focus on promoting four main activities, namely municipal environmental management, urban space management, municipal renovation management and smart urban management. Building on the basis of its existing property management business, the company has extended its range of services, ranging from service to residents to service “residents + citizens”, and from “service within the framework of the service” to “service within the framework of the service”. the framework of service + service beyond the scope of the service “, and went from a single real estate service to a full spectrum service, helping to improve the scientific, precise and intelligent management of each city and participating in creating a better future for every city.

Since May 2021, Shimao Services has cooperated with Shenzhen Shenxiong Environment Co., Ltd. (“Shenxiong Environment”) and Wuxi Jinshatian Technology Co., Ltd. (“Jinshatian Technology”) to establish its arrangement in two key regions, namely the Grand Bay Area and the Yangtze River Delta region, and in strengthening its overall core capacities in municipal services. Shenxiong Environment ranked among the top 10 environmental remediation companies in the Great Bay region, and Jinshatian Technology ranked sixth in the municipal environmental remediation industry in China. Both companies are national high-tech enterprises and have national level 1 qualification for cleaning services.

In addition, Shimao Services has started cooperation with local governments in nine regions, including Jiangsu, Fujian, Guizhou, Sichuan and Heilongjiang. In addition, he recently implemented two projects in Sucheng District of Suqian City and Acheng District of Harbin City, respectively. It should be noted that in the future, Shimao Services plans to invest in its second national headquarters in Wenjiang District, Chengdu City, with the aim of expanding into the urban service area. Ye Mingjie said, “We will focus on harnessing our resources and advantages in community governance and municipal services to provide quality services such as management of municipal public property, exploitation of urban spaces. and the development and operation of intelligent communities, in order to help the central and western regions develop a new concept of dynamic and intelligent life. “

Strive to achieve five-fold growth over the next three years
The state has introduced a series of favorable policies intensively in recent years. Shimao Services believes that the introduction of these policies has created favorable conditions for the standardized operation of real estate companies and the long-term positive development of the industry. “The policies are conducive to the healthy development of the real estate services industry, especially for real estate service companies that insist on a long-term development approach. Shimao Services has always been firmly optimistic about real estate services and is confident in its future development of quality and high growth potential, ”said Ye Mingjie.

In the long term, Shimao Group and Shimao Services are optimistic about the real estate services industry. As an important part of Shimao Group’s one-body, two-wing, airplane strategy, Shimao Services has quintupled over the past three years. Over the next three years, the Shimao Group will continue to redouble its efforts to support the rapid and continued growth of the real estate services segment of Shimao Services, operating on the thin asset model.

Looking to the future, Shimao Services will move forward by implementing its defined strategies and positioning itself as one of the leading providers of comprehensive property management and community life services in China based on the brand concept ” Better Smart Life ”. It will also strive to become one of the leading comprehensive city life service scenario providers in China. In addition, the Group will insist on the achievement of short and long term objectives, seizing opportunities to establish a presence and further develop the four main business segments of comprehensive property management, diversified value-added services, smart city and digital services. technology, accelerate the implementation of its strategies, accelerate the expansion of its business and build new value-added engines. These efforts will enable the Group to achieve lasting competitiveness that will enable it to achieve the objective of quintuple its growth over the next three years.

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