China Vanke embraces the internet with Baidu partnership
Deal paves way for era where developers will make extensive use of internet technologies
China Vanke, the mainland's biggest developer by sales revenue, announced a strategic partnership agreement with internet search giant Baidu to aggressively use internet technology by expanding the services it offers while speeding up its entry into the mainland industrial property sector.
"The internet will change the world and those that cannot adapt to such a change will be washed out," said Vanke chief executive Yu Liang.
Vanke will use location-based service technology in its projects and usher in an era where property operators will make extensive use of internet technologies to analyse the activities of their clients to improve services.
Last year and earlier this year, Yu led his team to visit leading domestic internet firms including Alibaba, Xiaomi and Tencent, to learn how they can use the internet in the traditional property business.
The announcement also unveiled Vanke's quickened foray into the commercial property business in which it has lagged behind many peers including China Resources Land and Longfor Properties.
Another developer, Fantasia Holdings Group, has even attempted to spin off its property management subsidiary Colour Life for a separate listing in Hong Kong.
Vanke said it planned to open about 20 new projects in the next three years in cities such as Beijing, Shanghai, Shenzhen, Wuhan, Ningbo and Chongqing.
The move was a step towards its ambition to become a service provider for city development and it has also announced a plan to invest in industrial properties.
"Vanke aims to rank No2 in modern logistics space [after GLP] in three to five years in this new strategic focus for the next decade," Citi analyst Oscar Choi wrote in a note after attending Vanke's investors' day in Sanya last month.
To prepare for such a quick expansion, Vanke formed strategic alliances yesterday with more than 40 retail brand operators including China Resources Group and CJ Corp.
The company set up its commercial property management division in January last year and now owns almost 20 million square metres of commercial properties as well as a combined floor space of several million square metres in offices, hotels and serviced apartments.