More than half of the schedule of the Beijing Winter Olympic Games, the ice and snow romance performed by the Chinese people continues to attract the attention of the world.
On the morning of February 15, Chinese contestant Gu ailing won the silver medal in the final of women’s slope obstacle skills of freestyle skiing in the Winter Olympic Games. Yunding Ski Park, the competition venue of Gu ailing on that day, is located in Miyuan Yunding Park in Chongli District, Zhangjiakou City. It undertakes 20 sub items of freestyle skiing and snowboarding in the Beijing Winter Olympic Games. It is also the competition venue with the largest number of gold medals.
As one of the three major competition areas of the Beijing Winter Olympic Games, Zhangjiakou Chongli will undertake all snow sports except snowmobile, sledge and alpine skiing. Under the influence of the upsurge of the Winter Olympic Games, Chongli has also attracted many ski lovers. A report from Chongli district government shows that in 2020, Chongli district received 2.815 million tourists with a total revenue of 2.005 billion yuan.
At the same time, Chongli has also become a “deer market” for ice and snow business of many real estate development enterprises. In addition to Miyuan Yunding Park, the “Chongli Prince city town” built by Zhonghe group with an investment of about 25.6 billion yuan is also arranged here. The project covers the Winter Olympic awards square, landscape lake, four seasons business street, International Conference and Exhibition Center, international resort hotel group, ice and snow characteristic supporting area, ecological residential area, etc.
In fact, before the Beijing Winter Olympics, many provinces and cities, including Jilin, Liaoning and Heilongjiang, had built and operated many ski resorts.
According to the big data from the same trip, driven by the Beijing Winter Olympics, the orders of ice and snow scenic spots in China increased by 68% year-on-year during the Spring Festival holiday in 2022; The snow melting world in Guangzhou, Chengdu and Wuxi, Jilin Vanke Songhua Lake Resort, Changbai Mountain Tourism Co.Ltd(603099) Wanda International Resort and other ice and snow sites are “full”. Vanke Songhua Lake project received 39200 passengers from New Year’s Eve to the sixth day of the new year, with a year-on-year increase of 72% and a year-on-year increase of 126% in operating revenue.
Ice and snow sports development plan (2016-2025)
In November 2016, the ice and snow sports development plan (2016-2025), jointly issued by the State General Administration of sports and other four departments, pointed out that in 2025, more than 50 million people will directly participate in ice and snow sports and “drive 300 million people to participate in ice and snow sports”; The total scale of ice and snow industry will reach 600 billion yuan in 2020 and 100 billion yuan in 2025.
In the face of trillion ice and snow blue ocean market, anyone wants a share, and real estate enterprises are no exception. Many real estate enterprises, including rongchuang, Vanke, Aoshan and Rongsheng, have already made layout in the field of ice and snow industry. From Wanda, which was the first to join the board, to Vanke, Shimao, Rongsheng, and rongchuang, which has been developing rapidly in recent years, the ice and snow industry is becoming another track for real estate enterprises.
Chinese player Gu Ailing in the competition on February 15
Source: Xinhua News Agency
real estate enterprises accelerate the layout of ice and snow industry
On July 31, 2015, the 128th plenary session of the International Olympic Committee voted in Kuala Lumpur, Malaysia to hand over the right to host the 2022 Winter Olympic Games to Beijing.
Driven by the Beijing Winter Olympic Games, the construction of China’s ice and snow tourism city has begun to make full efforts. In order to achieve the goal of “300 million people on ice and snow” proposed during the Olympic bid and prepare for the Winter Olympic Games, China has issued a series of policies in the planning and construction of ice and snow venues and facilities and the training of ice and snow sports talents, so as to promote the prosperity and development of the ice and snow industry.
According to the white paper on China’s ski industry, the number of ski venues in China has reached 770 in 2019 and is expected to exceed 800 in 2022. According to the China ice and snow tourism development report (2022) released by the China Tourism Research Institute, the number of ice and snow leisure tourists in China increased from 170 million in the ice and snow season from 2016 to 2017 to 254 million in the ice and snow season from 2020 to 2021; It is estimated that in the ice and snow season from 2021 to 2022, the number of ice and snow leisure tourists will reach 305 million, and the income of ice and snow leisure tourism is expected to reach 323.3 billion yuan.
Data source: General Administration of sport of the people’s Republic of China, Quantuo data, Zhiyan consulting and sorting
As for the real estate industry, the layout of real estate enterprises in the ice and snow industry can be traced back to 2009.
As the first real estate enterprise to set foot in the ski industry in China, Wanda Group invested 23 billion yuan to build its first ski resort in Changbai Mountain Tourism Co.Ltd(603099) international resort as early as 2009 and opened in 2012; Although since then, due to financial problems, Wanda was forced to transfer its four ice and snow projects to rongchuang, Wanda’s layout in the ice and snow industry has not stopped. In July 2021, Wanda started to build a mountain indoor ski resort with a fall of about 200m and a length of about 1000m in Zhaoqing, Guangdong. It is planned that the fall and length of the snow track will be the first in the world.
In 2011, just two years after Wanda laid out the ice and snow industry in Jilin, Vanke also built its first Songhua Lake Resort with ice and snow as the theme in Jilin, and officially opened in 2015. Since then, Vanke also announced the establishment of the ice and snow business department to integrate the resources of Songhua Lake Resort, Shijinglong ski resort and Beidahu ski resort (not self-supporting).
Rongchuang China officially entered the ice and snow industry after acquiring Harbin Wanda cultural tourism city in 2017.
On January 18 this year, rongchuang official wechat announced that rongchuang cultural tourism group reached a strategic contract with Beijing beiwen assets and the Management Committee of Jilin Changbai Mountain Tourism Co.Ltd(603099) conservation and Development Zone, and the three parties will carry out in-depth cooperation around Changbai Mountain Tourism Co.Ltd(603099) Heping snow field, Nanshan snow field and other projects. As of January 2022, the total area of the indoor ski resort operated by rongchuang cultural tourism has reached 422000 square meters, and the annual passenger flow of the operating project has reached 2.49 million person times.
Rongchuang once evaluated the ice and snow business segment as “one of the departments with the highest profitability”. In September 2021, it was rumored that rongchuang was considering to spin off the ice and snow business and listed in Hong Kong as early as 2022.
Rongshengkang tourism has successively invested in the development of Yesanpo ski resort and longjiangping international ski resort. According to rongshengkang tourism, during the Spring Festival holiday this year, the number of people received by Shennongjia ski resort is estimated to be 1340, and the actual turnover is 350000 yuan, double that of last year; In 2021, the passenger flow will reach 22000 person times and the operating revenue will be 1.6 million yuan.
Skiers in Hebei Yesanpo Ski Resort
Source: visited enterprise
Not only is the head real estate enterprises stepping up the layout of ice and snow industry, but also some regional real estate enterprises are no exception.
Taking Wuhan local real estate enterprise Aoshan holdings as an example, Aoshan opened its first real ice rink in Wuhan in 2013. Since then, the two wheel drive development strategy of “ice and snow + housing” has been established nationwide. Therefore, Aoshan has also been labeled with the characteristics of ice and snow, becoming the regulator of its diversified layout.
According to the reporter, the special ice and snow industry chain of Aoshan includes ice and snow training, ice and snow events, ice and snow equipment, ice and snow manufacturing, ice and snow tourism, ice and snow performing arts and other sectors. The three main theme product lines of Aoshan ice and snow characteristic industrial chain are ice and snow town, ice and snow complex and ice and snow sports mall.
Chongli, located in Zhangjiakou, is the main position of the snow project of the 2022 Winter Olympic Games and the “deer race” for the ice and snow business of many real estate enterprises. The “Chongli Prince City ice and snow town” project, located in Chongli center, is expected to be developed and built by Zhonghe group with a total investment of 25.6 billion yuan. The town covers the Winter Olympic awards square, landscape lake, four seasons business street, International Conference and Exhibition Center, international resort hotel group, ice and snow characteristic supporting area, ecological residential area, etc.
Zhangjiakou Olympic awards square
Source: visited enterprise
Insiders said that the active entry of real estate enterprises into the cultural tourism or ice and snow business is not just a pure commercial behavior. As an industrial cooperative land acquisition, the indoor ice and snow field is also a good solution for the stock removal project of real estate enterprises. At the same time, it can also play the role of endorsement and publicity.
“China’s initiative of ‘300 million people on ice and snow’ has brought great opportunities to the ice and snow sports and ski resort industry, which is expected to become a highlight of consumption growth in the future.” Jian Ke, head of China Market Research Department of Savills, said that more consumers appreciate the extreme charm of outdoor sports and nature, which will surely prompt more owners to think about how to improve their competitiveness, so as to compete with internationally famous ski resorts.
diversified participation methods
The ice and snow industry mainly includes ice and snow service industry, ice and snow site facilities construction industry, ice and snow supplies and related products manufacturing industry. Although there are many real estate enterprises in the ice and snow industry, most of them are concentrated in the real estate fields such as ice and snow site development and operation, ice and snow tourism and so on.
Kerry research pointed out that the current destination resort ski resort is still the first choice for most real estate enterprises to layout ice and snow tracks. For example, the core of rongchuang ski industry is to operate ski resorts and do ski resort management output. It will also cooperate with other enterprises to expand its territory. In recent years, rongchuang has arranged ice and snow business in many cities and tried to expand indoor ice and snow projects by taking advantage of the east wind of the Winter Olympics. Typical projects include “the largest indoor ice and snow field in South China” of Guangzhou Cultural Tourism City and “the world’s largest indoor ice and snow field” of Chengdu cultural tourism city.
In addition, focusing on the ski resort, rongchuang also focuses on the layout of ski schools and ski clubs, and develops new scene products, such as youth camp products suitable for winter and summer vacation, characteristic training camps to meet the needs of skilful snow friends, and will launch more competitive event products and participant themed activity products in the future.
Changchun Lianhuashan Shimao ski resort funded by Shimao Group is a medium-sized experience ski resort integrating mass tourism skiing and competitive competition. The aerial skill platform jumping in the ski resort is a professional preparation site for the Winter Olympic Games. Meanwhile, in 2020, Shimao Group also donated 20 million yuan to participate in the construction of the “overseas Chinese Winter Olympic ice and snow Museum”.
Data source: State General Administration of sports, Zhiyan consulting and sorting
However, Kerry also said that in addition to multiple realization channels such as hotels, commercial rents and ski resorts, obtaining low-cost land and selling houses are the main ways for real estate enterprises to revitalize their assets.
Taking Miyuan Yunding Park in Chongli, Zhangjiakou as an example, within the planning scope, in addition to the ski resort, Miyuan Prince ski Town, a commercial and residential apartment project with external sales, and Yunding Liyuan, a residential project, are also developed and constructed.
According to the website of fangtianxia, at present, the house types listed in Miyuan Prince ski town are one bedroom and two bedroom with an area of 44-56 square meters. Since its opening in 2018, the average sales price of the town has been maintained at about 27000 yuan / m2, with a total construction area of about 160000 square meters. Based on this, the overall marketable value of the project is expected to exceed 3 billion yuan.
Source: fangtianxia website
The average sales price of the residential project Yunding Liyuan, which opened for the first time in 2016, has exceeded 30000 yuan / m2. At present, it has further increased to about 34000 yuan / m2. These sales properties distributed in Miyuan Yunding Park helped the Lin family, the developer of the park, return a lot of funds.
In addition, the real estate development income of Jilin Vanke Songhua Lake resort ski resort in 2016-2017 was 139 million yuan and 252 million yuan, accounting for 55.38% and 67.74% of the total revenue. Vanke subsidized the investment and operation of ski resorts, hotels, commercial streets and other assets in the resort by “selling, maintaining and renting”.
In fact, in addition to developing cultural and tourism projects related to ice and snow, some enterprises also get a share by participating in the construction of Winter Olympic venues and infrastructure, but most of these real estate enterprises have a “national team” background.
For example, in early 2018, the first consortium that won the bid for the “ice ribbon” project of the national speed skating Hall signed a framework agreement with Beijing major project office to invest in the establishment of “Beijing national speed skating hall Operation Co., Ltd.”. The shareholders’ agreement of the company was signed by five shareholders of Beijing state owned assets Corporation, Beijing Capital Development Co.Ltd(600376) , Beijing Urban Construction Group, Beijing housing group and huati group.
It is reported that the national speed skating hall will undertake the competition and training of Avenue speed skating during the Winter Olympic Games. After the competition, it will also be built into the first ice activity center that can be operated in four seasons in Beijing. It can not only hold international top events such as skating, hockey and curling, but also for the public to carry out ice activities.
In addition, Beijing Zhuzong group has also undertaken projects such as Yanchong expressway, Beijing Ice project training base complex hall and so on.
telling the “ice and snow story” is not easy
Although the ice and snow industry is highly expected by many real estate enterprises, it is not easy to tell a good ice and snow story.
Although Zhang Jin, vice president of Aoshan holdings, once proposed the goal of 50 ice and snow projects to be launched nationwide in 2023, from the perspective of public information, as of May 13, 2019, Aoshan holdings had only one ice rink in operation, the other three ice rinks were still under development and construction, and training fees and admission tickets were the main sources of its income.
The income it brings is meager, even less than a fraction of the total income of Aoshan holdings. From 2016 to 2018, the revenue of Aoshan ice and snow sports and entertainment business was 2.255 million yuan, 8.684 million yuan and 2.954 million yuan respectively. In the current period, the income of Aoshan holdings was 1.321 billion yuan, 1.551.5 billion yuan and 1.891 billion yuan respectively, accounting for only 0.17%, 0.56% and 0.16%.
Aoshan holdings, which wants to use the “housing + ice and snow” strategy to open the door of the Hong Kong stock exchange, finally did not have any further listing news after two table deliveries and two failures. Previously, the relevant person in charge of Aoshan holdings also admitted in an interview with the reporter of the daily economic news that “the failure of the two IPOs has certain external objective factors. In the short term, we should not take the initiative to apply for listing again.”
Not only Aoshan but also Vanke suffered setbacks.
At the end of 2020, the ice and snow Business Department of Vanke, which has been established for less than four years, was revoked, and the ice and snow business and team were incorporated into the hotel and resort business department.
The key reason for the cancellation of the ice and snow business unit is that it doesn’t make money. In the first half of 2021, Vanke achieved a revenue of 167.11 billion yuan. In the revenue composition, in addition to real estate and property, including commercial real estate, logistics, ice and snow vacation, overseas, long-term apartment rental and education, Vanke called them “other businesses”, with a total revenue of only 1.01 billion yuan.
In the view of insiders, the ice and snow industry has the characteristics of large investment, long cycle and long tail effect. If developers burn money through blood transfusion for a long time, it may be difficult to promote the profit and “return to capital” in the growth period only by relying on business income such as tickets. For real estate enterprises with relatively difficult capital chain, it is worth paying attention to how much financial resources they can have to support the ice and snow industry in the future.
The operating cost of the snow farm usually includes personnel wages and welfare expenses, fuel expenses, raw material expenses, maintenance expenses and others. According to media reports, the annual operating cost of Guangzhou rongchuang snow world is 40 million yuan, of which more than 60% is fuel.
“The early investment amount of ski resorts is generally high, and long-term capital needs to be introduced. If it is only short-term funds such as trust and AMC, it may bring high financial risks to the enterprise.
”Kerry said.
From the past experience of other industries, in order to expand consumer heavy asset projects, we must first have a complete chain of “investment, financing, management and retreat”. According to incomplete statistics, up to now, there are no ice and snow related projects with ABS or other capital instruments.
The only ABS in the field of ice and snow projects can be traced back to 2018. Vanke Songhua Lake trust usufruct asset support special plan was successfully issued, with a total scale of 1.059 billion yuan, including priority scale of 1.006 billion yuan, AAA rating, product term of 8 years and weighted issuance interest rate of 5.26%. It is reported that the underlying assets of the ABS are ski resort income and hotel income.
However, the ABS of this period was terminated in advance on April 27, 2020 and then liquidated.
At the same time, as a small and dangerous ice and snow sport, it has high requirements for the economic consumption level of the customer group, and the target customer group is also relatively limited.
The reporter of “daily economic news” found that the price of a snowboard is basically more than 2000 yuan. After the purchase of a full set of equipment (including snow boots, snow clothes, snowboards, snow glasses, helmets, etc.), the entry-level is close to 6000 yuan.
Let’s look at the coach fees in the entry-level period. Taking Chengdu rongchuang snow world as an example, Ctrip app shows that the price of 3-hour skiing (including teaching) in the primary track night field is 258 yuan, including 1 pair of 10 double board teaching once for 1 hour; On other apps, the price of a ski experience class is generally about 200 yuan.
Ski price on an online shopping platform
“From the current consumption of the whole market, the consumption of ice and snow is increasing. To some extent, consumption is constantly promoting enterprises to layout the ice and snow industry; from the supply side, the supply of ice and snow industry is still relatively small, leading to the positive layout of real estate enterprises.”
Yan Yuejin, research director of the think tank center of E-House Research Institute, told reporters that the national layout of ice and snow projects is difficult, which has a lot to do with the natural conditions and traffic location that the ice and snow industry depends on; Secondly, it also has a certain relationship with the industry itself. Different from the traditional tourism consumption demand, the consumption demand of ice and snow industry is too single and needs to be cultivated.
“To tell a good story of ice and snow, I think the key is to make brand influence. At present, the ice and snow industry is in the stage of shaping brands. At this time, enterprises should deeply investigate market consumption, activate consumption demand, and combine the ice and snow industry with various tourism consumption and consumer groups of all ages. I think this is a very key content.” Yan Yuejin continued.
How to continue to operate in the post Olympic era {123567}
However, it should be noted that with the holding of the Beijing Winter Olympics, the development of the ice and snow industry may usher in new development opportunities.
A special survey on ice and snow tourism from China Tourism Research Institute shows that 90.1% of the respondents have experienced ice and snow tourism in different forms, 63.3% have experienced ice and snow tourism 1 ~ 2 times and 24.8% have experienced ice and snow tourism 3 ~ 4 times every year, indicating that China is entering the rigid demand stage of ice and snow tourism from the experience stage of ice and snow tourism.
Xu Hejian, director of the Beijing Information Center and spokesman of the Beijing Municipal People’s government, also said earlier that hosting the Winter Olympics had a positive effect on Beijing’s economic growth, especially on the development of ice and snow industry, infrastructure construction and the improvement of people’s livelihood. “In the process of preparing for the Winter Olympics, the coordinated development of ice and snow tourism, sports events, education and training and other fields has created more employment and development opportunities for the society.”
Data source: State General Administration of sports, Zhiyan consulting and sorting
On the other hand, some real estate enterprises have considered more long-term in the layout of the ice and snow industry. For example, the town of Chongli Prince city can not only play a role during the Winter Olympics, but actually Zhonghe wants to do more, “we want to build it into a world-class all-time four-season resort destination, build new consumption scenes and help the development of the new economy.”
At the beginning of construction, Zhonghe considered the follow-up operation here: “in order to take into account the sustainable operation in the post Olympic era, the town has signed a contract with partners such as intercontinental hotel group, a top hotel management group, to benchmark the International Winter Olympic town and world-class conference and exhibition platform from planning and design to operation.”
According to the relevant staff of the project, “there is not only ice and snow, but also Chongli in summer is a good place for leisure. This is a natural oxygen bar with appropriate temperature, which is very suitable for tourists around.”
At the same time, some enterprises, such as Fosun lvwen and rongchuang, are testing asset light models such as entrusted management. Among them, among the 65 Clubmed resorts located in the world in 2020, 41 adopted the leasing mode, 10 obtained the Commission through the management mode, and only 14 were self-sustaining with heavy assets; The three outdoor ski resorts operated by rongchuang also adopt the asset light operation mode.
In addition, Kerry also believes that standing above the trillion scale of the ice and snow industry, most real estate enterprises are still difficult to find a profit balance in the ice and snow real estate. In terms of type selection, the cash flow of vacation ski resort is better than that of learning ski resort and experience ski resort.
Specifically, in the future, a small number of real estate enterprises, such as state-owned enterprises, can expand diversified income by undertaking the construction of government related ice and snow hardware facilities. Private enterprises with rich experience in ice and snow tracks can consider cooperating with local state-owned enterprises in asset light operation. In terms of revitalizing assets, we can choose to issue asset securitization products with high-quality ice and snow projects as the underlying assets to revitalize the projects.
reporter’s notes | real estate enterprises “play” with ice and snow and become a problem
Gu Ailing and Su Yiming won gold and silver, the Chinese delegation won the best record in the history of the Winter Olympics, and the whole network “one trick is hard to find”… Since the opening of the Beijing Winter Olympics on February 4, the Beijing Winter Olympics has set off a new upsurge throughout the country.
Since Beijing successfully won the right to host the Winter Olympics in 2015, driven by multiple positive factors, the ice and snow economy has risen rapidly in China. The increasing market scale year by year has also made the ice and snow industry a new outlet for competition.
In the field of real estate, although Vanke, Wanda, rongchuang and other real estate enterprises have successively poured into the “ice and snow track”. However, under the trillion wind outlet, even if it is rubbed with the heat of “ice and snow”, it is not easy for “new and old players” to “consolidate and improve the basic market” and share a share of the ice and snow industry: the seasonality of ice and snow business, heavy assets and long return cycle are all problems that enterprises have to face.
How can we make the ice and snow become the “golden mountain and silver mountain” of real estate enterprises? This is a problem worthy of long-term thinking. Perhaps only finding a market breakthrough, solving the problems existing in the ice and snow business and finding a profit model are the core weights for the take-off of the ice and snow economy.
Under the ice and snow wave, real estate enterprises still have a long way to go.
