Research On Transformation Of Business Model And Its Performance In Wanda Commercial Properties

Since the reform and opening up,China's real estate industry,especially the residential real estate sector has experienced a period of rapid development,has gradually become the backbone of the national economy.Due to limited by the macro policy of the purchase,a lot of residential real estate-based real estate companies began to layout commercial real estate,in the future,commercial real estate will usher in a period of rapid development.However,nowadays,real estate enterprises in China are operated in "re-asset" mode,in which the real estate enterprises not only participate in the whole real estate projects including in buying land,developing real estate projects,and selling real estate projects and other aspects of the specific work,but also they should afford all costs,as a result,real estate companies have to be faced with debt pressure,profit pressure and cash flow pressure and other financial risks and the real estate industry competition risk and e-commerce under the competitive risk and other operational risks.In addition,compared with residential real estate,commercial real estate has longer investment development cycle and more investment costs,as a result,real estate business will be face with more serious risks when they layout of commercial real estate Therefore,if real estate enterprises want to keep the dominant position in the fierce competition and increased risk of the real estate market,they should transform the business model,for example,they could transform “heavy assets” model of operation to “light assets “model of operation to solve the problem.Firstly this paper summarizes the "heavy asset" mode of operation of traditional commercial real estate enterprises in China,its' reasons of business model transformation and the commercial real estate enterprises currently adopt the "light assets" business model,so as to get an initial understanding of the business model of commercial real estate enterprises.Then combined with the transformation experiences of commercial real estate giant-Wanda commercial properties,this paper analyzes its business model transforming in detail,including why it want to transforming,what is the goal of transformation and how to transform.Then in order to draw the performance of its transformation,this paper also analyzes its reasons of transformation from the financial point of view and the transition angle,and finds out that after the transformation,Wanda commercial properties can just achieve its transformation goals and can also ease the financial risks and operational risks when it is in "re-asset" business model.So we believe that Wanda commercial properties has achieved good results by transforming its' business model.Finally,combined with the successful experience of Wanda commercial properties,it provides three transformation strategies for those enterprises being transformed or to be transformed,the first is to improve corporate financing channels,the second is to improve the commercial occupancy rate and rental recovery rate,the third is to enhance the enterprise light asset management capabilities.