A partner secretly engages in a price war, and China Construction Smart City Development demands that Yuexiu hand over the operation rights of a project in Beijing.

This year, the most attention - grabbing real - estate segment in Beijing might be Huangshanmudian in Chaoyang.

On April 28th this year, China Construction Intelligence Land, a subsidiary of China Construction First Group, jointly with China Jinmao, Yuexiu Property, and Chaoyang Real Estate Development Company, won the bid for the land parcels in Huangshanmudian and Sunhe Group in Chaoyang District, Beijing, with a total price of 12.6 billion yuan.

This group of residential land is divided into two parcels, north and south. The south parcel is operated by China Construction Intelligence Land, and the north parcel is operated by Yuexiu Property. Jinmao is responsible for the product. All four companies hold shares in both projects, with cross - shareholding. The names of these two projects are Zijin Chenyuan and Puyue respectively. Both are positioned as high - end improvement projects and are also the key projects of the operating companies in the Beijing market this year.

As an area adjacent to Star River Bay with a large number of improvement - oriented customer groups, initially, these two projects received high market attention and high expectations. Moreover, there has been no new residential land in the Chaoqing area for about 10 years. So, both the industry and the real - estate companies involved in the operation believed that these two projects would sell well.

Everything was harmonious until the early stage of the project launch.

Originally, the cross - shareholding was also to avoid direct competition and achieve shared benefits. Fundamentally, there was no problem, right?

However, recently, there have been rumors of disharmony among the shareholders of the two projects.

Yesterday, Beijing Xingding Real Estate Development Co., Ltd. sent a report letter to the State - owned Assets Supervision and Administration Commission of Guangzhou, "accusing" Yuexiu Property of not following the unified pricing standard for the housing sources of the two land parcels agreed upon in the previous meeting of the project shareholders. It secretly adjusted the prices of some housing sources, resulting in a loss of over 300 million yuan in the value of the goods. At the same time, by adjusting the prices, it made some housing sources in the south parcel (Zijin Chenyuan) lose their competitive edge, leading to the loss of customers and affecting the signing of housing sources worth over 2.2 billion yuan.

The total amount of over 2.5 billion yuan is quite huge.

Before this, Beijing Xingding Real Estate Development Co., Ltd. also directly sent a letter to Yuexiu Property, demanding that Yuexiu "immediately stop malicious attacks" and hand over the operation right of the north parcel (Puyue) before noon on November 17th.

While sending the letter, China Construction Intelligence Land has stopped all approval, contract, seal - using, and financial work for the north parcel.

China Construction Intelligence Land stated that if Yuexiu fails to complete the handover of the operation right within the time limit, it will permanently launch an all - out and undifferentiated attack on all of Yuexiu's projects in Beijing; permanently raise the prices of all the land parcels that Yuexiu is tracking in Beijing without discrimination; and continue to report to higher - level relevant departments.

It's like a complete breakdown of relations.

Beijing Xingding Real Estate Development Co., Ltd. is a subsidiary of China Construction Intelligence Land, holding 97% of the shares. Xingding holds 50.1% of the shares of Beijing Xingchang Real Estate Development Co., Ltd., which is the project company of Zijin Chenyuan.

Source: Tianyancha

The project company of Puyue (north parcel) is called Beijing Maoyue Real Estate Co., Ltd. Although China Construction Intelligence Land holds 49.9% of the shares, the operating party is Yuexiu, which holds 17% of the shares. The operating party has the marketing decision - making power.

Source: Tianyancha

This equity structure design was originally a strategy to balance the interests of all parties. Although Yuexiu holds a small proportion of shares, it can get more dividends through operation. All parties comprehensively consider the capital contribution and the actual workload, reducing the capital cost while obtaining benefits.

However, as long as it is a business, there will be different interest considerations. Moreover, after these two projects were launched in September this year, the market declined, and the sales were below expectations. Cracks appeared among the shareholders.

As of now, only 115 out of the 308 housing sources in Puyue that obtained the sales permit on September 27th have been signed for online contracts.

As of now, only 111 out of the 559 housing sources in Zijin Chenyuan that obtained the sales permit on September 26th have been signed for online contracts.

Moreover, these two projects are very close to each other. There is not much difference in the unit price and the area of the housing types. The customer sources are in direct competition. Zijin Chenyuan is a little closer to Chaoyang North Road, with a slightly less favorable location, so it is very sensitive to the "price war".

Location map of Puyue and Zijin Chenyuan

Originally, the product strength of these three companies, China Construction Intelligence Land, Yuexiu, and Jinmao, is very strong, and the products of the two projects are also quite good. Now that they are having disputes, it can only be said that the market pressure is too great.