New World Development Limited announced that its residential projects in mainland China have achieved impressive sales growth despite the market downtrend. Total contracted sales in July and August exceeded RMB 4.1 billion, representing a year-on-year increase of 138.5%. Cumulative residential sales for the first eight months of this year is over RMB 10 billion. These impressive results have positioned New World China Land (“NWCL”) among the top 100 developers in mainland China, according to three major real estate research institutions: the CRIC Research Center, the China Index Academy and EH Consulting. With the recent stimulus measures proving favourable to the mainland China real estate market, major investment banks have released reported affirming their positive effects. The Group believes that these measures will have a positive effect on the upcoming projects and contribute to its sustained profit growth.
Greater Bay Area and Yangtze River Delta Market Contributed 91% of Sales Revenue
Among residential sales across the country, the Guangdong-Hong Kong-Macao Greater Bay Area and Yangtze River Delta market contributed 91% of NWCL’s revenue. Projects such as the Guangzhou NEW METROPOLIS MANSION, which was launched in March this year, and Guangzhou PARK PARADISE, have seen excellent market performance. THE CO-CENTRAL MANSION, in Zengcheng, Guangzhou achieved an average transaction price of RMB 36,000 per square meter, setting a new record in the area. In the eastern China market, the second phase of the CITY GATHER in Shanghai sold out immediately. In the northern market, THE PARKSVILLE held the top position in residential sales amount from July to August in Shenyang. Overall, NWCL maintains a high level of profitability with a gross profit margin of approximately 60% for projects in the Greater Bay Area.
NEW METROPOLIS MANSION Exceeded RMB 2.5 Billion in Sales
The impressive sales performance is a result of the Group's forward-looking strategy in the core cities of the Greater Bay Area and the Yangtze River Delta. These regions have favorable conditions for continued industrial development and population structure, with higher consumer power and market resilience. The group has leveraged its ecosystem advantages to create flagship projects. NEW METROPOLIS MANSION in Guangzhou, for example, is a transit-oriented development (TOD) project, in collaboration with Guangzhou Metro. Located above the Hanxi Changlong Station, it is a relatively scarce TOD project in the Guangzhou market. It seamlessly integrates rail transportation, K11 Select, residential areas, communities, and urban green space. It is also connected to the Changlong-Wanbo CBD and Chimelong Safari Park, showcasing its prime location. Since its sales began in March this year, the cumulative sales have exceeded RMB 2.5 billion.
Echo Huang, Executive Director of New World Development and Director & CEO of New World China, said, "Benefiting from the group's forward-looking strategy, high-quality developments and brand advantages, our projects have gained strong market recognition and achieved steady growth. With a sufficient supply of projects in the GBA and the Yangtze River Delta, the group is confident in maintaining sustained future growth."
Sufficient Supply of Projects, with Plans to Continue to Launch New Projects This Year
A number of stimulus measures that favour the mainland China real estate market have been announced recently, including preferential mortgage rates enjoyed by first-time homebuyers in several first-tier cities, regardless of their previous credit records; minimum down payment ratio set at no less than 20% for the first home nationwide; and minimum down payment ratio for the second home set at no less than 30%. Major investment banks such as Morgan Stanley, JPMorgan, and UBS have issued reports stating that these measures have short-term positive effects, particularly in the home prices of first-tier cities, which are expected to rebound.
The group believes that developers focusing on high-quality projects, such as NWCL, will benefit from new opportunities under the new market conditions. The group is currently preparing to launch several significant projects, including the upcoming launch of the Baietan project in Guangzhou, which is expected to be released in the market by the end of this year. The first phase of commercial portion of Hangzhou’s New World Arts Centre is also set to sell by the end of this year. NEW METROPOLIS, in Guangzhou, is scheduled for full opening in May 2025. NWCL also plans to launch a large number of projects next year, contributing to the sustained growth of NWCL.