An internet leader suddenly throws hundreds of billions of investment plans

To understand the billions of investment plans that an Internet leader has suddenly thrown out, you need to mobilize enough imagination or leave his words behind.

Jack Ma, the CEO of Alibaba Group, announced at the end of May this year that it plans to use 8-10 years to build a "China intelligent Logistics Backbone Network" (CSN), which can support daily retail sales of 30 billion yuan per day. A company owned by Alibaba Group 43%, called "Rookie Network" came into being, undertook the task of realizing this plan.

Using the "rookie" this self-deprecating company name, Ma Yun wants to express some degree of humility to the community, but the National Logistics Backbone Network plan itself, so that its inflated commercial ambitions revealed no doubt.

According to Ma said, the establishment of China's intelligent logistics backbone network, the first phase will cost 100 billion, two will continue to invest 200 billion yuan. A total of 300 billion of the huge investment plans turned out, the rookie network did not disclose to outsiders the source of billions of funds and use.

Rookie network CEO Shen said, rookie network is not a logistics company or express company, but in the logistics based on a set of open, shared, socialized infrastructure platform.

But no matter how the novice network describes itself, from the field of logistics real estate industry to try to make the "First financial daily" reporter believe that rookie network has or will do, and the general logistics real estate developers engaged in the business does not have the essence of the difference, that is: financing, take the land, self-built warehousing, and then external leasing, Whether it is e-commerce-oriented enterprises, logistics companies, warehousing enterprises, third-party logistics providers.

There is only one question that interests these real estate developers: How much land can we eat to fill this rookie's appetite?

Tax change Land

"We are an internet company," a rookie insider told reporters, "In fact, we do not want to do industrial real estate, we just hope that through the use of large online data and offline warehousing layout, to build a harmonious logistics eco-industrial chain." ”

Although the rookie network tries to create some kind of abstract concept to avoid leaving behind the impression that they are engaged in the development of logistics real estate, but in fact it shows the coveted land reserves, and any expansion of the Logistics property developers are no difference, at least at this stage.

Rookie network refused to disclose to reporters the current land area and different stages of planning, but the public report still roughly outlines the tip of its "gongchenglvede".

November 27, rookie network and the Henan provincial government signed a series of investment agreements, will be in Zhengzhou Airport economic comprehensive experimental zone to create a new type of logistics warehousing and electric business Cluster Park, multimodal transport base, bonded Logistics Base, electric Business park four projects. In addition, according to the Chongqing Daily Report, in November, the rookie network also decided to establish a hub node in the airport function area of the bonded port in the Chongqing Liang Jiang New zone. That means Zhengzhou and Chongqing will enter a list of cities that provide the newest land reserves for the rookie network.

If you consider rookie network recently completed on the former Alibaba Group Logistics Division of Integration, the latter since 2011, the original project seized the bag, rookie network has a large scale of land reserves of cities in addition to Zhengzhou, Chongqing, but also including Tianjin, Hangzhou, Guangzhou, Wuhan and so on. Alibaba Group previously planned to deploy 8 large storage nodes in northeast, north, east, south, Central, southwest and northwest regions.

"If the network really can achieve 300 billion investment, it is like putting a big stone into a bucket filled with water, will bring impact on the entire industrial land market." "said an international logistics real estate developer in China.

Large-scale land into the field of logistics real estate development, has actually let the rookie network and occupy the domestic market a major share of the international logistics developers to compete business rivals. The ability of the novice to acquire land has put pressure on some international logistics real estate developers operating in China.

Logistics land is now becoming the object of competition for all enterprises engaged in logistics real estate development in China. Pengfeili, Director general of the Greater China region of the group, introduced, on the one hand, China's per capita storage supply is only 7.5% of the United States, the market potential is huge, on the other hand, the market is extremely short of supply and dispersed, available for logistics use of land supply is scarce.

"In the one or two-line mature market, high-end logistics warehousing is now facing the situation of demand, in Shanghai, for example, high-end logistics and warehousing supply currently only accounted for One-fourth of the demand, which is a lot of international and domestic developers are still keen on the one or two-line cities ' crazy ' to take the ground reason. DTZ DTZ, director of the Ministry of Commerce (Industry and Logistics), Su Zhihuan, China.

Ma Yun Myth wrapped and bundled the concept of the rookie network, more general logistics real estate developers in the process of picking up a particular advantage. "By arranging regional settlement centers, the electric business enterprises can bring considerable tax revenue to the local area, obtain bargaining chips with the government, and obtain preferential land." "Su Zhihuan said.

In fact, by splitting the settlement center, the tax landing as a "bait" to attract local governments to provide low-cost and high-quality industrial land, is the Alibaba Group has been the actual operation of the land-use model.

"But the problem with this model is that the electrical business logistics can not be unlimited to divide the settlement center to take the land, once lost the advantage of tax landing, the name of the second ring of electric business enterprises will also face how to continue to acquire the land of the problem." "Su Zhihuan said.

This conundrum may be solved in other ways. In addition to getting the land needed from the two-tier market through negotiations with local governments, the rookie network may still be looking for other ways to get land, such as acquiring a logistics company with a large industrial land reserve. One of the signs is that Mr Ma met with Han Tielin, chairman of the Reserve Stock (600787.SH) in August, to discuss the issue of "rookie" cooperation informally.

The business of the investor

While throwing hundreds of billions of plans, the rookie network did not describe the investment's earnings prospects. At a rookie internal board meeting, Mr Ma warned all shareholders that investment might not be profitable for the next 8-10 years, media reported. But this statement is not in line with the logic of business investment, the actual situation is likely to be very different.

"For the international logistics developers who have been operating in China for the past ten years, their profits come from three: first, the interest rate spreads, the use of cheap foreign funds, such as the U.S. pension funds low interest rates to 1%~2%, investment in domestic logistics real estate, to obtain returns, the second is the appreciation of the renminbi, the third is the value of land. "Su Zhihuan said.

A data provided by the Ka min Group to reporters shows that the current net investment yield of high quality storage facilities is about 6.5% to 7%. A recent demonstration of the GLP to investors shows that the internal rate of return (IRR) of the 10-year investment has reached 15%~20% in China's development of a logistics real estate project.

For the local rookie network, spreads and the appreciation of the renminbi can not be discussed, but in a market for industrial land supply shortage, in addition to the rental income of the rental itself, land value-added will provide attractive profits.

"If the current stage of the electrical business logistics into the field of industrial real estate development is to ' enclosure ', then they will most value the potential of land value-added." "Su Zhihuan said," Some areas of land, although started in the name of the logistics site, but depending on the local development, if the future can achieve ' turn ', to commercial, office land, then this part of the potential of the increase in value will be very large. ”

Covet the appreciation of land speculation, by public opinion criticized as "enclosure", which became a rookie network does not want to be interpreted as a reason for logistics real estate development. But the big deal is actually the rookie of the network at this stage of the most important energy to do things, which also brings a question: How the rookie network to take out billions of dollars of money, eat enough to fill the desire of a lot of land.

The International logistics real estate developers in China said that foreign logistics real estate developers can through overseas funds or listing platform, access to a large number of low-cost funds to achieve rapid expansion in China, but the domestic logistics developers are facing the bottleneck of financing channels.

Since the domestic real estate investment trust (REITS) has not yet opened, logistics real estate projects are difficult to attract dispersed funds, the domestic logistics developers have always been able to work with the financial or investment institutions, one-by-one project development, do not have the ability to expand large-scale assets.

"Rookie network advantage is that its shareholders are a certain amount of financial strength of private enterprises, whether through self-financing, or to use the financing capacity of these enterprises, to a certain extent, to solve the problem of funds." "Su Zhihuan said.

According to the company's ownership structure announced by the rookie network, in addition to the 43% shareholding Alibaba Group, Yintai through the Beijing state-June Investment Co., Ltd. Investment in 32%, as the second largest shareholder, in addition, Fuchun Group through the Fuchun Logistics investment shareholding 10%, Shanghai Fosun Group through Shanghai Star Investment Co., Ltd. accounted for 10%, Yuantong, Shun Fung, Shentong, Yun-Da, the general principles of symbolic contributions, each obtained 1% of the shares.

It is hard to imagine that these private-sector shareholders can take out and endure an investment of billions on scale, "investments that may not be profitable for the next 8-10 years", and that the rookie network, like any logistics real estate investor, faces financing bottlenecks as well. Registered in Shenzhen before the Sea rookie logistics, is considering the use of the former Sea Open financial policy to break through this bottleneck, rookie network refused to disclose their financing plans.

With uncertain prospects, the "Rookie Network" program is unfolding a little bit. In Tianjin Wuqing, Alibaba Group in the end of 2011 investment in the construction of the North China E-commerce Logistics Center project has been put into operation; similarly in Wuqing, Amazon chose to rent the GLP developed logistics park.

Dealing with the self-built logistics of electric enterprises, financial investors and the electric business enterprise own views are very different. "At least for overseas investors, the light asset model of the electric Business Enterprise Logistics Warehousing is not the necessary choice, which will make the balance sheet less good-looking, but on the other hand, the huge value-added potential of domestic land can enlarge the company's profits and valuations." One industry insider said.

Rookie network of billions of investments, in the current stage, may only be a land of the capital game. Graphics/Hao Ming