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Provide Chinese companies with integrated service approach to expand abroad

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​As Chinese companies are aggressively expanding their businesses overseas, they are facing a number of challenges such as lack of understanding of local market practice and are unfamiliar with the environment and rules.

China Global offers a global platform which provide real estate consultancy services across different countries and sectors. Our global solutions and focused local expertise have delivered corporate real estate best practices to help our client to achieve their goals.

China Global aims at to serve as the single point of contact for our clients. We have good understanding of the Chinese companies’ culture as well as their unique needs. We provide tailor-made and comprehensive solutions through JLL’s integrated approach across countries and markets. We help Chinese companies to expand their businesses outside of China in the most cost efficient way.

China Global not only help you to find suitable projects in various markets but also support you in terms of transaction management, project management, property management and facility management, etc.

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Asset Securitization Expected to Become Key Financing Models in China’s Real Estate Sector/china/en-gb/news/597/property-finacing-reportAsset Securitization Expected to Become Key Financing Models in China’s Real Estate Sector<p>​<em style="line-height:1.6;font-size:16px;">​​According to the latest whitepaper from JLL</em></p><p><strong>Shanghai, 27 April 2017</strong> - China's rapid-developing <a href="/china/en-gb/services/investors-and-developers/private-investor-advisory" target="_blank">real estate ​</a>finance sector stands at a crossroads. JL​L has released a detailed report on the topic titled <Financing China's Real Estate: Pragmatism and Creativity Will Prevail>. The report gives a comprehensive picture of the various financing models currently used by China's real estate developers, including bank loans, domestic and foreign corporate bonds, senior debt, perpetual bonds, trust firms, P2P lending, crowd-funding, and joint ventures. In addition, the report conducts in-depth studies of the opportunities and challenges faced in China by emerging financing models such as CMBS and REITs.</p><p>According to JLL China's Head of Capital Markets Research <strong>Dave Chiou</strong>, the Federal Reserve's efforts to taper off Quantitative Easing and raise interest rates mean that the days of easy financing or re-financing for Chinese developers and assets holders may be ending. In particular, China's central government may introduce a new wave of tightening policies, which will further increase financing difficulties for businesses. "In order to obtain necessary funding and reduce financing costs, developers and asset holders must rely on a combination of traditional financing models (such as bank loans or corporate bonds) as well as other financing channels."</p><p>"Although asset securitization is still in its infancy in China, it has vast potential and is expected to become a major financing model for Chinese developers and asset holders. This model is likely to influence the overall development pattern of China's real estate finance sector," said <strong>Joe Zhou</strong>, Head of Research for JLL China.</p><h3><strong>Diversified financing</strong></h3><p>Bank loans, corporate bonds and senior notes are the traditional primary funding sources for Chinese developers. Corporate bonds and senior notes in particular are characterized by easy access of capital and low interest rates.</p><p>These financing models alone are insufficient to satisfy the ever-growing financing needs of real estate developers, however. Rising land prices in particular have led many developers into a state of high leverage. In addition, China's rapidly-changing policy environment heightens the risk for firms relying on a narrow range of financing models.</p><p>As a result, developers are expected to actively seek more diversified financial channels. In recent years firms already have begun to favour relatively new funding sources such as perpetual bonds, trust firms, P2P lending, crowd-funding, and joint ventures.</p><p> </p><h3><strong>Opportunities and challenges for asset securitization</strong></h3><p>Asset securitization – which already has reached a state of maturity in the US and other countries - remains in its infancy in China.</p><p>The forms of asset securitization most relevant for Chinese developers include commercial mortgage-backed securities (CMBS), residential mortgage-backed securities (RMBS) and asset-backed securities (ABS). All three typ​​​es help asset holders release value while retaining the underlying assets' future growth potential.</p><p>After the People's Bank of China relaxed its rules for the sales of such structured products in 2015, their popularity in China has grown. That said, the scale of China's mortgage and asset-backed securities market remains a drop in the bucket compared to developed markets su​​​​ch as the US. Statistics show that the total issuance of CMBS in the US hit USD 76 billion in 2016, accounting for 98% of the world's total. Since the 2008 financial crisis, annual issuance of CMBS in the US has held steady in the USD 50-100 billion range.</p><p>Asset securitization still has vast potential for development in China. "Considering the huge scale of China's real estate market and the needs of banks and developers for alternative financing channels, CMBS, RMBS and AB​S will become increasingly popular, and their issuance will grow in the years to come," said Chiou.</p><p>The trend towards greater use of mortgage and asset-backed securities in China is ev​​​idenced by innovative recent examples. In December 2016, Asia Pulp & Paper launched its first CMBS product in China, with a total deal size of RMB 7.8 billion. In August 2016, Everbright Real Estate Investment Consulting Limited launched its first ABS product in China in partnership with its investment affiliate, with a total transaction volume of RMB 1.6 billion.</p><p> </p><h3><strong>REITs: The next big thing in China?​</strong></h3><p>Real Estate Investment Trusts (REITs) are another relatively new financing ​​model with vast potential in China. REITs differ from CMBS, RMBS and ABS in that they securitize on the equity of underlying properties ra​​ther than the debt of assets. They help asset holders realize their asset value, and provide retail investors with relatively a low-risk option for real estate investment. From the perspective of developers and asset holders, REITs are a means to reduce debt leverage ratios and obtain long-term financing.</p><p>REITs have been welcomed by investors for their advantages in diversification, affordability, l​​iquidity, tax benefits, and transparency. In 2016, the US REIT market exceeded USD 1 trillion in market capitalization. REITs remain a new type of asset in Asian markets, however, with only Japan, Hong Kong, and Singapore having established REIT markets. Legal and procedural barriers so far have prevented China from launching true REIT products.  </p><p>"Over the short-to-mid-term, REITs are unlikely to develop in China, even if policy makers loosen regulations or provide tax preferences to investors," observed Zhou. "Low rental yields are the biggest barrier. At present, yield​​s for many assets are only 4% or even lower. In addition, and lack of professional management talent for REITs and property assets also have restricted the development of REITs in China."</p><p>In spite of many difficulties, REITs are still regarded as a promising alternative approach for China's real estate financing sector. "Further relaxing of policy and evolving mindsets from investors, developers and asset owners​​ could allow REITs to emerge as a major funding solution in China over the long term. REITs' ability to offer stability, returns and diversification that no other asset class can mimic ensures that they will continue to receive consideration in the years ahead," said Zhou.​</p><div><br></div><div><p style="text-align:center;">​– ends –​​</p><br><p><em style="line-height:1.6;">>>>Read more about </em><em style="line-height:1.6;"><a target="_blank" href="http://www.joneslanglasalle.com.cn/china/en-gb/news" style="line-height:1.6;">JLL News</a><br></em><em style="line-height:1.6;">>>>Read more about​ </em><a target="_blank" href="http://www.joneslanglasalle.com.cn/china/en-gb/research" style="line-height:1.6;"><em>JLL Research</em></a>​</p><span class="ms-rteFontSize-1 ms-rteThemeForeColor-5-0"><strong><em><br>About JLL</em></strong></span><p><span class="ms-rteFontSize-1">JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. A Fortune 500 company with annual fee revenue of $5.2 billion and gross revenue of $6.0 billion, JLL has more than 280 corporate offices, operates in more than 80 countries and has a global workforce of more than 60,000. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 4.0 billion square feet, or 372 million square meters, and completed $138 billion in sales, acquisitions and finance transactions in 2015. Its investment management business, LaSalle Investment Management, has $59.1 billion of real estate assets under management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, <a target="_blank" href="http://www.joneslanglasalle.com.cn/" rel="nofollow" style="line-height:19.2px;">www.jll.com</a><span style="line-height:19.2px;">. </span></span></p><p><span class="ms-rteFontSize-1">JLL has over 50 years of experience in Asia Pacific, with over 34,000 employees operating in 92 offices in 16 countries across the region. The firm won 15 awards at the International Property Awards Asia Pacific in 2016 and was named number one real estate advisor in Asia at the 2015 Euromoney Real Estate Awards. <a target="_blank" rel="nofollow" href="http://www.joneslanglasalle.com.cn/asiapacific" style="line-height:19.2px;">www.jll.com/asiapacific</a><span style="line-height:19.2px;">  </span></span></p><p><span class="ms-rteFontSize-1">​In Greater China, the firm was named ‘Best Property Consultancy in China’ at the International Property Awards Asia Pacific 2016, and has more than 2,200 professionals and 14,000 on-site staff providing quality real estate advice and services in over 80 cities across the country. <span style="line-height:19.2px;"> </span><a target="_blank" rel="nofollow" href="http://www.joneslanglasalle.com.cn/china/en-gb" style="line-height:19.2px;">www.joneslanglasalle.com.cn</a>​​​​</span></p></div>0x0100E81015D9D08198458B498FF948D658F90052B0972AFC77B94093C478C1B5B47C88
Upgraders has taken up spaces in Tianjin Grade A office market and vacancy rate declined slightly 49.8% /china/en-gb/news/596/jll-tianjin-q1-real-estate-reviewUpgraders has taken up spaces in Tianjin Grade A office market and vacancy rate declined slightly 49.8% <p>​<span style="line-height:1.6;font-size:16px;"><em>​​​According to JLL Tianjin's 1Q17 Property Review</em></span></p><p><strong>Tianjin, 17 April 2017 </strong>– JLL's 1​​Q17 property review revealed the following:</p><p></p><ul><li><span style="line-height:1.6;">High vacancy rates in the office market pushed rents down</span><br></li><li><span style="line-height:1.6;">Warehouse demand from 3P​L firms continued to grow</span><br></li><li><span style="line-height:1.6;">Global Mall Tianjin opened in a suburban area</span><br></li><li><span style="line-height:1.6;">High-end residential prices declined after four consecutive quarters of increase</span><br></li></ul><h3><span lang="EN-GB"><strong>Office</strong></span></h3><p style="text-align:justify;"><strong>Total net absorption was 49,000 sqm in 1Q17, an increase of 94.2% q-o-q and a decrease of 63.8% y-o-y.</strong></p><p style="text-align:justify;"><strong></strong>There was strong demand in the first quarter as tenants moved into buildings that were completed in 2016 such as Vantone Center and Yanlord Riverside Plaza.  Nearly half (43%) of the total net absorption in the quarter was in Grade A stock.  Leasing demand of Grade A came mainly from the real estate and finance sectors. For example, Hong Kun Wei Ye, a domestic real estate developer, leased 700 sqm in Tianjin World Financial Centre, and Rong Tai Real Estate Company, another domestic real estate developer, leased 870 sqm in Yanlord Riverside Plaza. One of the most notable leasing transaction in finance sector was Home Credit, a MNC's consumer finance company, leased another 2,400 sqm for expansion in Modern City Office Tower.</p><p style="text-align:justify;"><strong>No new supply entered the market in 1Q17</strong><strong> and total stock remained unchanged at 2.7 million sqm.</strong> Due to the positive net absorption and no new completions in the <a href="/china/en-gb/services/property-types/office" target="_blank">office ​</a>market, vacancy rates in both Grade A and Grade B projects declined slightly. The Grade A vacancy rate declined 2.5 percentage points q-o-q to 49.8% and the Grade B rate fell 1.5 of a percentage point q-o-q to 31.7%.</p><p style="text-align:justify;"><strong>Net effective rents continued to decline, falling 0.6% q-o-q and 4.4% y-o-y, to RMB 93 per sqm per month. </strong>Grade A rents fell 0.7% q-o-q and 10.6% y-o-y to RMB 104 per sqm per month. The sustained high vacancy rate in the Grade A market caused landlords to lower rents to absorb vacant space. Grade B rents declined 0.6% q-o-q and 2.3% y-o-y to RMB 88 per sqm per month. </p><p style="text-align:justify;"><strong>Another eight projects are expected to complete in 2017, which will add 481,000 sqm and push the overall vacancy rate up by end-2017.</strong> "While two new Grade A buildings that are located outside the traditional business area will enter the market, the largest contributors to the Grade A demand will be the newer, centrally located Grade A projects, such as Vantone Center and Yanlord Riverside Plaza," noted Lv Weiran, Head of Markets for JLL Tianjin.​</p><h3><span lang="EN-GB"><strong>Logistics</strong></span></h3><p style="text-align:justify;"><strong>In 1Q17, there was a​​ negative net absorption of space (of 58,000 sqm) as lease expirations combined with a slowdown in new set up to create more empty space in Tianjin's warehouses.</strong> The main demand drivers of the market were 3PLs. Two examples were FineEx.com, a domestic 3PL company, leasing 20,000 sqm in GLP Park Beichen Phase I, and DTW Logistics leasing 6,000 sqm in GLP Park Tianjin Puling and Pujin Phase I. </p><p style="text-align:justify;"><strong>While no new supply entered the market in 1Q17, the non-bonded vacancy rate grew 2.3 percentage points q-o-q and declined 2.4 percentage points y-o-y to 21.9%. </strong>The lease expirations and the limited leasing transactions this quarter drove the vacancy rate in the Wuqing submarket up 5.8 percentage points q-o-q and down 5.9 percentage points y-o-y to 8.1%.</p><p style="text-align:justify;"><strong>Net effective rents reached RMB 0.91 per sqm per day, an increase of 0.3% q-o-q, and 1.0% y-o-y on a like-for-like basis. </strong>Rental movement this quarter varied by submarket with those with relatively low vacancy rates and strong demand, such as Beichen, continuing to see rental growth. However, this growth was offset by submarkets with high vacancy rates, such as Jinnan, which saw landlords reducing rents to attract tenants.​</p><p style="text-align:justify;">Michael Hart, Managing Director of JLL Tianjin commented, "The <a href="/china/en-gb/services/property-types/industrial-and-logistics" target="_blank">logistics ​</a>market is one of Tianjin's bright spots, despite the fact that we expect to see seven new logistics projects (including five expansions of current projects) completed in 2017, we expect the vacancy rate will decline slightly by year end. We expect strong leasing demand to continue from both 3PLs and retailers located in the greater Beijing area."</p><h3><span lang="EN-GB"><strong>Retail</strong></span></h3><p style="text-align:justify;"><strong>Leasing d</strong><strong>emand increased at a slower pace in 1Q17, with net absorption at 88,000 sqm, a decrease of 37.0% q-o-q and 48.0% y-o-y. </strong>New leasing continued to come mainly from F&B and the children-related sectors. F&B retailers prefer to open in the core retail area when they first enter Tianjin, whereas children-related operators focus on community malls that cater to families in non-core areas. For example, Roast Fish and several Chinese cuisine restaurants from Beijing leased space in Heping Joy City for their first outlets in Tianjin. My Gym leased about 800 sqm of space and Helen Doron English leased about 500 sqm in InCity Mall, located in the Meijiang area. Many fashion retailers slowed down their expansion although Me & City and Urban Revivo were still opening new outlets.</p><p style="text-align:justify;"><strong>Global Mall Tianjin opened in the non-core area, Zhongbeizhen, adding 90,000 sqm of shopping space and was the only new high-quality shopping mall of 1Q17. </strong>It entered the market as a community mall with a large proportion of its space delegated to the F&B, entertainment and service retailers that contributed 36.0% of net absorption in the quarter. With high absorption in other community malls such as InCity Mall and Delight City, the market vacancy rate saw a decline of 0.2 percentage point q-o-q and 2.3 percentage points y-o-y to 14.6%.</p><p style="text-align:justify;"><strong>Along with the moderate leasing increase in this quarter, rents remained little changed. Net effective rents reached RMB 11.2 per sqm per day, an increase of 0.1% q-o-q and 1.1% y-o-y on a like-for-like basis. </strong>Rents in the majority of the projects remained unchanged due to growing regional competition. However, malls with clear positioning and unique retailer mixes still enjoyed rental growth, such as Tianjin International Trade Center in the Xiaobailou Area and Aeon Shopping Center in Zhongbeizhen. </p><p style="text-align:justify;"><strong>Looking forward, four new malls are expected to enter the market by end-2017. </strong>A large shopping mall, TeeMall, is expected to open in 2Q17, adding another 190,000 sqm of space in core <a href="/china/en-gb/services/property-types/retail" target="_blank">retail</a> submarket, Heping Road submarket. Sunny Yin, Head of Retail for JLL Tianjin, commented, "Benefiting from access to Metro Line 3 and with a large number of F&B and experiential retailers, the mall is forecast to become a destination mall and attract shoppers from the entire central Tianjin area. This is likely to increase the competition in the core area, especially in Heping Road and Binjiang Avenue submarket."​</p><h3><span lang="EN-GB"><strong>High-end </strong></span><span lang="EN-GB"><strong>R</strong></span><span lang="EN-GB"><strong>esidential</strong> </span></h3><p style="text-align:justify;"><strong>High-end residential market sales volume decelerated to 1,754 units, a decline of 24.9% q-o-q and 39.6% y-o-y. </strong>The decline was mainly driven by the tightening housing measures that came into force in late 2016 and the seasonal effect of the Chinese New Year holiday. Unsold stock in the high-end market stood at 634 units by end-quarter, its lowest level since 2005.</p><p style="text-align:justify;"><strong>A total of 1,079 new units were launched in 1Q17, a decrease of 45.6% q-o-q and 29.2% y-o-y. </strong>Vanke Dongdi Meijiang Highrise Phase I, in one of the main <a href="/china/en-gb/services/property-types/residential" target="_blank">high-end residential</a> area of Meijiang, was launched with 503 units of which 482 were sold at an average price of RMB 26,894 per sqm. The relatively low price of this project attracted both first-home buyers and upgraders.</p><p style="text-align:justify;"><strong>High-end residential capital values declined after four quarters' increase, declining 2.4% q-o-q but still rising 38.6% y-o-y.</strong> The tightening policies introduced in late 2016 started to restrict housing demand and dragged down market prices. Rents saw a marginal increase in the quarter, rising 0.3% q-o-q and 1.2% y-o-y.</p><p style="text-align:justify;">Further housing restrictions were announced in Tianjin starting from April 1<sup>st</sup> 2017, including the prohibition of local unmarried and non-local residents from buying a second home and raising the down payment for second-time home-buyers from 40% to 60%. Chelsea Cai, Head of Research for JLL Tianjin, remarked, "The new round of housing restrictions is aimed to cool down the speculator demand in Tianjin. Therefore, we forecast the sales volume and market average price are going down, and the impact to continue to end-2017."</p><div><br></div><div><p style="text-align:center;">​– ends –​​</p><br><p><em style="line-height:1.6;">>>>Read more about </em><em style="line-height:1.6;"><a target="_blank" href="http://www.joneslanglasalle.com.cn/china/en-gb/news" style="line-height:1.6;">JLL News</a><br></em><em style="line-height:1.6;">>>>Read more about​ </em><a target="_blank" href="http://www.joneslanglasalle.com.cn/china/en-gb/research" style="line-height:1.6;"><em>JLL Research</em></a></p><p>​​</p><span class="ms-rteFontSize-1 ms-rteThemeForeColor-5-0"><strong><em><br>About JLL</em></strong></span><p><span class="ms-rteFontSize-1">JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. A Fortune 500 company with annual fee revenue of $5.2 billion and gross revenue of $6.0 billion, JLL has more than 280 corporate offices, operates in more than 80 countries and has a global workforce of more than 60,000. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 4.0 billion square feet, or 372 million square meters, and completed $138 billion in sales, acquisitions and finance transactions in 2015. Its investment management business, LaSalle Investment Management, has $59.1 billion of real estate assets under management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, <a target="_blank" href="http://www.joneslanglasalle.com.cn/" rel="nofollow" style="line-height:19.2px;">www.jll.com</a><span style="line-height:19.2px;">. </span></span></p><p><span class="ms-rteFontSize-1">JLL has over 50 years of experience in Asia Pacific, with over 34,000 employees operating in 92 offices in 16 countries across the region. The firm won 15 awards at the International Property Awards Asia Pacific in 2016 and was named number one real estate advisor in Asia at the 2015 Euromoney Real Estate Awards. <a target="_blank" rel="nofollow" href="http://www.joneslanglasalle.com.cn/asiapacific" style="line-height:19.2px;">www.jll.com/asiapacific</a><span style="line-height:19.2px;">  </span></span></p><p><span class="ms-rteFontSize-1">​In Greater China, the firm was named ‘Best Property Consultancy in China’ at the International Property Awards Asia Pacific 2016, and has more than 2,200 professionals and 14,000 on-site staff providing quality real estate advice and services in over 80 cities across the country. <span style="line-height:19.2px;"> </span><a target="_blank" rel="nofollow" href="http://www.joneslanglasalle.com.cn/china/en-gb" style="line-height:19.2px;">www.joneslanglasalle.com.cn</a>​​​​</span></p></div>0x0100E81015D9D08198458B498FF948D658F90052B0972AFC77B94093C478C1B5B47C88

 

 

China Corporate Real Estate Trends 2015/china/en-gb/research/211/china-corporate-real-estate-trends-2015China Corporate Real Estate Trends 2015We are delighted to present the China edition of JLL's biennial Corporate Real Estate Trends report, a data-driven exploration of the current state and future direction of the corporate real estate profession specific to companies operating in China.0x01010063443623C9F9004FA21AA8EABD6132C80096456DD4F4AF204EB9DD2C24B361B045