Assets are things that can generate free cash flow for the company, so the assets of urban investment companies are crucial. Strengthening the management of assets by urban investment companies and maximizing the value of assets will, on the one hand, help urban investment companies give full play to their comprehensive functions of urban resource development and promote urban economic construction and development. On the other hand, it will help urban investment companies accelerate their transformation and realization Sustainable Development
1. The "Implementation Opinions of the State Council on Promoting the Pilot Reform of State-owned Capital Investment and Operating Companies" (Guofa [2018] No. 23) points out that "state-owned enterprises can be established in two ways: reorganization and new establishment. Capital investment and operating companies shall, according to their specific positioning and development needs, reorganize and integrate relevant state-owned capital through free transfer or market-oriented methods";
2. "Notice of the State Council on Issuing the Plan for Reforming the Authorized Operation System of State-owned Capital" ” (Guofa [2019] No. 9) proposed “to realize the transformation of the state-owned capital form by liquidating and exiting a group, reorganizing and integrating a group, and innovating and developing a group”;
3. In order to control hidden debts since 2021 growth, cleaning up and regulating local financing platform companies has once again become an important matter for the government. With the promulgation of documents such as Guofa [2021] No. 5 and Yinbao Jianfa [2021] No. 15, especially Guofa [2021] No. 5 It is required that "those who lose their ability to pay their debts must implement bankruptcy reorganization or liquidation in accordance with the law." The asset integration and transformation of urban investment companies has been put on the agenda.
According to whether there is market-oriented cash flow, urban investment platform business is divided into three categories: public welfare business, quasi-public welfare business and operating business. The vast majority of urban investment projects involve public welfare businesses, such as urban infrastructure construction and land consolidation, and the direct source of business repayments is local governments; most urban investment projects also include quasi-public welfare businesses, such as housing renovation, affordable housing, water supply and electricity Heat, garbage treatment, sewage treatment, etc. have a certain cash flow, but only a small profit or loss, and government subsidies are needed to balance the gap; some urban investment also involves operational market-oriented businesses, such as trade, product sales, real estate, and financial leasing. , guaranteed small loans, etc.
The above three categories of business of urban investment companies need to rely on different types of assets to operate. Specifically, public welfare business is mainly carried out around land assets, while quasi-public welfare business and operating business require It is carried out relying on operating assets, real estate assets, financial assets, etc.
1. Land assets
Land assets are the most valuable realizable assets of urban investment platforms. The public welfare business of urban investment companies is mainly carried out around land assets. In the integration of land assets During the process, attention needs to be paid to the nature of the land, the method of acquisition, etc.
From the perspective of the nature of the land, it should be noted that according to the Caiyu [2017] No. 50 and the Development and Reform Commission Caijin [2018] No. 194, the reserved land can no longer be integrated into the platform company. The current nature is Land used for transfer, commercial, residential, commercial, and industrial purposes can be integrated; from the perspective of acquisition methods, for public welfare land such as public rental housing and affordable housing that is not for profit, the land use rights can be obtained free of charge through government allocation, but The prerequisite is that the land must be approved by relevant departments in accordance with the law and strictly used for designated purposes. For constructive land such as business land or industrial land, urban investment platforms must participate in "bidding, auction, and listing", pay land transfer fees in a timely and full amount, and obtain land use rights.
In addition, urban renewal is also an opportunity to obtain land assets: In 2021, most provinces and cities across the country have proposed urban renewal, and many urban investment companies have established urban renewal subsidiaries. Judging from urban renewal policies across the country, urban renewal is overwhelmingly market-oriented and operational projects that do not involve new hidden debt issues. This is also an effective and legal way for urban investment companies to transform their debt.
2. Operating assets
(1) High-speed and urban rail transit
Such assets benefit from their stable cash flow sources and can usually become Urban investment companies obtain high-quality underlying assets for long-term financing. Specifically, the expressway business mainly includes the construction and post-construction operation of expressways, and the urban rail transit business mainly includes the construction and operation of subways and urban rail transit.
In terms of investment and financing models, due to the large amount of funds required for this type of business, diversified financing models are usually adopted, such as introducing social capital or adopting an integrated operation and management model.
For example: During the construction of Beijing Subway Line 4, Beijing Infrastructure Investment Co., Ltd. divided the entire project into non-operating parts and operational parts according to the basic ratio of government investment and social investment of 7:3. Among them, the non-operating parts such as tunnels and tracks, which account for 70% of the total investment, are funded by the government, and the operational parts such as vehicles and automatic fare collection equipment, which account for 30% of the total investment, adopt the BOT model and are the first in the country. A rail transit project operated under a joint venture model between the government and social capital.
(2) Other public assets
Other public assets mainly involve urban public service-related fields, such as urban water supply, heating, gas supply, sewage treatment, garbage disposal, etc. , and other types of franchises such as water management rights, parking spaces (roadside parking, parking lots), gas stations, charging piles, driving schools, commercial cemeteries, etc.
Chengtou has a natural advantage in operating public utilities in the region, which helps provide stable cash flow for Chengtou. Utilities such as water supply, power supply, and heating have significant scale effects and high entry thresholds, and are generally accompanied by the issuance of franchise rights. Urban investment platforms can obtain franchise rights by integrating government and regional resources, and integrate within the region Fragmented public utility companies are being consolidated to obtain stable cash flow. For example, Bozhou Urban Construction Development Holding Group Co., Ltd. (hereinafter referred to as "Bozhou Urban Construction") has expanded its business in the public sector in recent years, integrating urban parking lots, underground pipe galleries, natural gas, strong and weak current pipelines, water supply and sewage, etc. Public sector resources are operated under the main model of franchising. Dalian Detai Holdings Co., Ltd. (hereinafter referred to as "Dalian Detai") owns the franchise rights of major public utilities such as heating, gas, water supply, and sewage treatment in Dalian Jinpu New District.
3. Real estate assets
Real estate assets mainly include residential buildings (commercial housing, affordable housing), commerce, industrial parks, etc. Generally speaking, the real estate property business of urban investment companies should be combined with the land business. Urban investment companies that develop residential properties are similar to small regional real estate developers. They develop and build on their own or form joint ventures with large real estate developers for development, and urban investment companies provide land resources; Chengtou, which is engaged in commercial real estate development, builds office buildings, shopping malls and other properties in core areas of the city, and sells or leases them to obtain rental income. For example, Bozhou Urban Construction's real estate project development model is divided into self-operated real estate development and cooperative real estate development, and relies on real estate development business to expand the downstream services of the developed industrial chain, including property services and business management operations.
In addition, assets such as standardized factories related to industrial parks are mostly found in urban investment platforms in development zones. They generally obtain factory rental income and other service income by building standardized factories and operating them themselves. In addition, some also involve Provide water, heat, electricity and even financial services to enterprises in the park. What needs attention is that due to the need to attract investment, local governments often require the industrial parks operated by urban investment companies to provide preferential treatment to the enterprises settled there, such as rent reductions and exemptions, provision of guarantees, small loans and other financial services. All industrial parks operated by urban investment companies in the early stage The operating income obtained is often low, and the operating profit is meager or even a loss.
4. Financial assets
Most of the financial assets of urban investment companies are the equity of listed companies. The main purposes of urban investment companies in taking over listed companies are two categories: (a) Taking industrial investment as the main purpose of mergers and acquisitions: Based on profit considerations, when an urban investment company has a business relationship with a listed company, it acquires the company to seek business synergy; if it has no business relationship with a listed company, the urban investment company acquires the company mainly for industrial investment. Optimize its own business structure and achieve diversified development, such as Xi'an Qujiang Cultural Industry Investment (Group) Co., Ltd. taking over Renle; (b) Backdoor listing as the main purpose of mergers and acquisitions: Urban investment companies need listed companies as a platform for equity financing. Backdoor listings are achieved through asset replacement, broadening financing methods and reducing financing costs. For example, Pizhou Economic Development Zone Economic Development Construction Co., Ltd. acquired Zhongxin Technology at a high premium.