IResearch: Helping eggshell apartments successfully land on the New York Stock Exchange

2022-11-21
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Author:Chen Liqun
Source: iResearch

Introduction:On January 17, 2020 EDT, eggshell apartments were officially listed on the New York Stock Exchange (NYSE) (stock code DNK). The issuing price of the Company is US $13.5 per share, and the issuing scale is 9.6 million shares. As of the closing, the market value of the Company is US $2.48 billion. As a consultant of eggshell apartment industry, iResearch Consulting helps its IPO process.

On January 17, 2020 EDT, eggshell apartments were officially listed on the New York Stock Exchange (NYSE) (stock code DNK). The issuing price of the Company is US $13.5 per share, and the issuing scale is 9.6 million shares. As of the closing, the market value of the Company is US $2.48 billion. As a consultant of eggshell apartment industry, iResearch Consulting helps its IPO process.

In this industry consulting service, iResearch helped the company gain insight into China's long-term rental market and the basic development status of the long-term rental apartment market, comprehensively analyze the development model of long-term rental apartments and major enterprises, help the capital market understand the industry, and recognize the company's development status and development advantages. Finally, it helped eggshell apartment to be listed successfully.

1、 The continuous growth of China's long-term rental market

China's long-term rental market is huge, and it is currently in the stage of integration and development. According to iResearch's estimation, China's rental population will reach 200 million in 2018, and the overall scale of the long-term rental market will reach 1.8 trillion yuan, which will reach 3.0 trillion yuan by 2023.

On the whole, China's first and second tier cities have high economic activity, broad job prospects, high wages, and a positive inflow of foreign population. Airy estimates that the overall long-term rental market size of China's first and second tier cities will reach 1.2 trillion yuan in 2018, accounting for 67% of the country's total, and will reach 2.0 trillion yuan in 2023.

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Airy analyzed that the development of China's long-term rental market is driven by multiple factors:

1) Continuous urbanization. In the past 40 years, China's urban population has increased from 182 million in 1979 to 837 million in 2018, with the proportion of urban population reaching nearly 60%. However, compared with the United States, Japan and other countries, China's urbanization rate is still low, and urbanization will continue to enter cities. It is estimated that China's urbanization rate will increase to 70% by 2030, which means that 170 million people will still enter cities from rural areas, bringing a large demand for residential space

2) High house purchase prices in the first and second tier cities. In the past 20 years, house prices in most of China's first and second tier cities have continued to rise. In the first half of 2019, the housing price income ratio in Beijing, Shanghai, Shenzhen and other cities reached 25 to 36 times. This has prompted consumers in China's first tier cities to significantly increase their first purchase age, and greatly increased the rental cycle of young people.

3) The change of residential concept. In addition to the impact of rising housing prices, more leisure and entertainment expenses and more frequent life changes make contemporary Chinese young people more inclined to rent rather than buy houses. According to third-party user survey data, about 43% of young people can accept permanent rental.

4) The national policy is favorable. In order to solve the housing problem of the population in the first and second tier cities, the national government has issued a series of policies to support the development of the long-term rental market. The long-term development of China's long-term rental market is to promote the equal rights of renting and purchasing, provide tenants with the same conditions of education and other public resources, and develop in a healthy and standardized way.

2、 Long rent apartment modelSolve the pain points of traditional industries

The demand for long-term rent is growing day by day, while the traditional long-term rent market is decentralized and inefficient. Landlords and tenants face many pain points, which brings great opportunities for the development of long-term rent apartments.

In the traditional long-term rental market, the pain points of landlords mainly include: high cost of house upgrading and refurbishment, long-term pressure of maintenance and repair, cumbersome and complex leasing process, gap between the expiration of the lease contract and the signing of new tenants, and difficulty in obtaining security in case of arrears, house damage and other emergencies. The pain points of tenants include: the process of finding suitable housing sources is tedious, the quality of houses is low, the credibility of landlords and housing intermediaries is low, and there is a lack of life services and management services during the lease period.

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With the popularity of the sharing economy and online consumption, the landlords' demand for property management has increased and the tenants' consumption has been upgraded, and the long-term rental apartments have achieved rapid growth. By 2018, the houses under standardized and unified management by long-term rental apartments have reached 2% of all rental houses in the market.

In the opinion of iResearch, the value of the long-term rental apartment model for the landlord is mainly reflected in: 1) convenient leasing process. The landlord entrusts the real estate to the long-term rental apartment enterprise for management, and does not need to personally contact a large number of local housing intermediaries and tenants. It saves a lot of time and expense in house upgrading, house maintenance and handling customer needs. 2) Stable income. Long term apartment enterprises sign long-term contracts with landlords to provide housing management services, reducing the losses of landlords due to factors such as off peak seasons and contract gap periods.

For tenants, the value of long-term rental apartments is mainly reflected in: 1) standardized living experience. Long term apartment enterprises will carry out standardized design and maintenance of their houses, improve the tenants' living experience and reduce the complexity of decision-making. 2) Convenient leasing process. Simplify the process for tenants to check in, and realize online signing, payment, feedback and other processes. 3) High quality service. The long-term rental apartment provides tenants with cleaning, housekeeping and other living services, greatly improving the convenience and quality of life of users.

3、 Technology enables the long-term rental apartment industry to improve operational efficiency

According to iResearchinternetIn the era, Internet technology is deeply penetrating into traditional industries to achieve the empowerment of traditional industries. In the long-term rental apartment industry, big data and intelligent platforms can optimize business processes, achieve online and intelligent planning, housing collection, transformation, rental, service and other aspects, and improve operational efficiency.

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On this basis, with residential space and services as the entrance and relying on scale advantages, we will develop various value-added services, which will bring more space for the development of the long-term rental apartment platform.

By organizing an experienced professional team to conduct in-depth industry research, iResearch has provided a large number of independent third-party data and conclusions for the drafting and disclosure of the eggshell apartment prospectus, and actively assisted in responding to the inquiries of the U.S. Securities and Exchange Commission on issues related to the industry, providing a satisfactory answer to the final IPO of eggshell apartment in the United States.

About iResearch

IResearch Consulting is a professional third-party organization that has been deeply involved in the research and consulting field for 17 years, and provides customers with business decisions. With the brand concept of "empowering business decision-making", the company helps customers improve their cognitive level, profitability and comprehensive competitiveness of the new economy industry through research and consulting and other professional services. On the basis of data and industry insight, iResearch's consulting and research business has expanded to big data research, enterprise consulting, investment research, new retail research and other directions, and is committed to helping enterprises understand the market and make intelligent decisions through research and consulting.

Based on more than ten years of industrial research experience and brand influence in the capital market, iResearch provides IPO industry advisory services to the market. withAlibaba, JD, Sogou, Qihu 360, Meitu, Cat's Eye EntertainmentmilletGroup, Meituan Dianping, Bilibili, Mushroom StreettencentMore than 90% of Internet enterprises represented by music, Huiliang Technology, iQiyi, English Fluent, Tongcheng Yilong, Youxin, Baishi Huitong, Huanju Times, Kunlun World Wide, Yirendai, etc. cited the industry data of iRui during IPO. The IPO service of iResearch started with the TMT field and gradually expanded to the new economy and traditional fields, serving nearly 100 customers in total.

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