Over recent years, the property management industry in the PRC has shown a vigorous development trend. With the promulgation and enforcement of a series of property management regulations and systems within recent years, the market environment of property management is becoming mature.
Commercial properties include various kinds of shopping malls, shopping centers, shopping plazas and various specialized markets, amongst which large-scale shopping malls that integrate a variety of service functions such as shopping, dining, recreation and finance are also known as “public commercial building”. Commercial properties are relatively profitable and are attractive to the market. However, services in relation to commercial properties have higher demand on human resources. Presently, commercial property management companies in the PRC aim at providing high-quality security, cleaning and other services in order to ensure proper and good operations of their customers’ premises. Provision of these high quality services can bring long-term and stable revenue to the property management companies.
PRC’s economic growth and strategies
According to the National Bureau of Statistics of PRC, as at the end of 2014, China’s nominal annual GDP reached RMB 63.6463 trillion (around A$14.2858 trillion*), achieving GDP growth of 7.4%.
*Based on the spot rate of A$1 = RMB 4.4552 issued by the Reserve Bank of Australia at 30 September 2015.
Data source: National Bureau of Statistics of PRC
In March 2014, the Government of PRC approved the implementation of the National New-Type Urbanization Plan (2014 – 2020), which explicitly seeks to focus on the urbanization of the population by encouraging eligible farmers from rural districts to move into urbanised areas. The Plan advances the implementation of the “Three 100 Million People” urbanization plan, which is to settle 100 million of the agricultural population in urban areas, to locally urbanise 100 million people in the central and western regions, and re-develop urban shantytowns and villages in which a total of 100 million people live .It is estimated that every 1 percentage point of increase in PRC’s urbanization rate could bring an increase in demand for investment and consumption of RMB 7(around A$1.57trillion*). By 2020, PRC’s urbanization rate is estimated to reach around 60%, thus the demand for capital will reach RMB 40 trillion (around A$8.98 trillion*).