An Empirical Study On Corporate Performance Of Diversified Real Estate Enterprises

China’s real estate industry has experienced rapid development for more than 30 years,and a number of Fortune 500 companies have emerged.However,in recent years,with the tightening of real estate regulation,the slowdown of market size growth,tightening of financing,and other reasons,the real estate industry’s operating risks have continued to increase,profit margins have continued to shrink,and a large number of real estate companies have opened up a diversified layout.During the competition,some real estate companies also gained high market share and strong influence in their diversified fields,which enriched the company’s product line and profit model.Some real estate companies expanded too fast due to blind expansion or diversified business.Towards bankruptcy and reorganization.So what effect does diversification have on company performance? Aiming at this core problem,this paper studies the impact of real estate business diversification and cross-regional diversification on company performance through research methods such as thesis investigation,theoretical analysis and empirical test.The main conclusions drawn from the research are that between 2016 and 2018,about 70% of housing companies have diversified.The diversified business mainly focuses on related industries within the real estate industry,as well as upstream and downstream industries,as well as businesses outside the real estate industry chain.The diversification of housing enterprises will adversely affect the performance of the company as a whole,and this adverse effect is mainly reflected in the damage to the company’s performance caused by non-relevant diversification.The company that implements related diversification has a more discrete impact on performance,which is related to the company’s management capabilities and the related industry’s inteleveragen capabilities.Related diversification behaviors have no significant impact on performance overall.Cross-regional diversification significantly contributes to the improvement of company performance.Finally,the paper puts forward some policy recommendations for the implementation of diversification of real estate companies,mainly on the internal and external conditions to be met for business and cross-regional diversification implementation,and the need for institutional guarantee to reduce agency costs in the process of diversification.