Construction Industry 2022: Change and Evolution

Five years is like a reincarnation. The changes five years ago may become evolution five years later. If you could turn the clock back five years ago to 2017, everything would look so good.

In 2017, US President Trump had just taken office, and the "trade war" was still far away from us; in 2017, we did not have a "coronavirus" yet, and "delta" was just a pure Greek letter "δ" ", not to mention the mouth-watering "Omicron"; in 2017, Panama announced the establishment of diplomatic relations with the mainland, leaving only 20 "diplomatic countries" with Taiwan; in 2017, the 19th National Congress, the "Belt and Road" Forum, and domestically produced aircraft carriers , C919, Hong Kong-Zhuhai-Macao Bridge, Xiongan New Area... everyone is "rolling up their sleeves and working hard." Everything is really so beautiful!

But for Wang Jianlin, chairman of Wanda Group, "2017 was a very unforgettable year. It experienced turmoil and endured some hardships."

Troubles often start with "rumors." On the morning of June 22, 2017, Wanda's securities series suddenly plummeted simultaneously. At 13:00 noon, the Shenzhen Stock Exchange issued an emergency announcement to temporarily suspend trading. Rumors abound: Shanghai Pudong Development Bank, ICBC Asset Management, China Construction Bank Shanghai and other institutions have asked their managers to liquidate Dalian Wanda-related bonds. Wanda responded: I hope everyone will not believe or spread rumors! As the incident continued to unfold, Wanda embarked on a difficult journey of selling and selling, starting from cultural tourism projects.

With Wanda’s “broken arm survival”, the baton of China’s richest man has also been passed to the hands of Xu Jiayin of Evergrande. In 2017, Evergrande was also so high-spirited. First of all, its performance was outstanding - Hengda Da Real Estate achieved contracted sales exceeding RMB 500 billion, turnover exceeding RMB 300 billion, and a cash balance of over RMB 280 billion. At the same time, Evergrande won seven consecutive Football League titles and provided Barcelona with "violent birds." At that time, the richest man Xu proposed the "New Evergrande" with "new starting point, new strategy and new blueprint", claiming that it would move from the "three highs and one low" of high debt, high leverage, high turnover and low cost to low debt, The "three lows and one high" transformation of low leverage, low cost, and high turnover will allow Evergrande to transform from the "King of Scale" to the "King of Profit"!

At the end of 2017, a design institute in the northwest region was similarly high-spirited. Although Evergrande introduced a scoring and ranking system, and the "high turnover" caused great pressure on front-line designers, with the expectation of stable business sources, the design The senior management of the hospital is planning to establish an "Evergrande Business Department" to improve the efficiency of serving Evergrande. At the same time, at the annual meeting of a construction company in the "Hometown of Architecture", the senior leaders' Xingyiquan was flowing smoothly, and the strategic cooperation with Evergrande was also fruitful.

The construction industry in 2017 is also undergoing some changes. This year, the total output value of the construction industry exceeded 20 trillion for the first time, and the year-on-year growth rate reached 10.5. The construction industry is still making rapid progress.

In early 2017, the General Office of the State Council proposed "accelerating the implementation of general engineering contracting" and "cultivating full-process engineering consulting" in the "Opinions on Promoting the Sustainable and Healthy Development of the Construction Industry". At the end of the year, the Ministry of Housing and Urban-Rural Development issued the "Measures for the Administration of General Contracting of Housing Construction and Municipal Infrastructure Projects" (Draft for Comments), which kicked off the general contracting of projects.

The effect of "Method" is immediate!

At the end of September 2017, four people were sitting in the conference room of a design institute in Fujian, and they were discussing where to hire someone to manage more and more general contracting projects in the institute. A candidate with the surname Zeng was identified from a short list. What these four leaders did not know was that although the number of people in the company was less than a hundred, starting from this selection, the design institute embarked on a wonderful journey of nearly fifty-fold growth in size. What these four people don’t even know is that the profound impact of general engineering contracting on the design industry, the construction industry, and even the construction industry began here.

At the same time, in Zherong County, a small fifth-tier county in Fujian Province that is located in the "same time and space", a county-level road with a length of only 517 meters - the eastern section of Shangqiao Road has become a nationally famous project. It is famous for successfully attracting bids from 1,108 companies across the country with an investment of 11.13 million yuan. The bid deposit alone was more than 200 million yuan, and the final winning price was 9.35 million yuan.

Times have changed, and the time is back to the end of 2021. This winter is a little warmer than before, and the richest man has become Zhong Suisui of Nongfu Spring. For the first time, there is a richest man whose business is more famous than his entrepreneur. But Xu Jiayin, the former richest man, encountered a cold winter, "encountered unprecedented difficulties and endured unprecedented severe challenges." As onlookers, we saw him build a high-rise building, entertain guests, and lie down. The government sent a working group to the group. The difficulties faced by Wanda back then were actually unprecedented and it had no reference. But now Evergrande has learned from Wanda's mistakes and can't even copy homework well. Comparing the two, Wang Jianlin, who was born in the military, seems to be better in determination and responsibility. .

The Evergrande Division of the northwest design institute, like many construction companies in Nantong, is internally investigating the impact of the Evergrande incident. This new year is likely to be really sad.

Let’s look at Manager Zeng from Fujian, now called Mr. Zeng. After entering this design institute, the general contracting business volume increased by leaps and bounds, reaching its peak in 2019, and then experienced job hopping. Arrived at a higher platform.

Some people say that change is eternal, and the law of the world is the balance between entropy and negentropy, and the transition from quantitative change to qualitative change. Of the three elements of people, things, and momentum, momentum may be the most important. People take advantage of the momentum to do good things, but people go against the trend and fail. This is the case with Wanda, and the same is true with Evergrande. No matter what "DA" is in the future, what changes is the name, not the name. What has changed is the essence - houses are built for people to live in, the real estate industry is at the threshold of evolution, and the storm is coming.

The construction industry is essentially a passive industry. Without investment, there will be no projects! 2022 is destined to be an eventful year for the construction industry. How widespread and intense the shock to the real estate industry will be will determine how the cake of this industry is divided in 2022. Some companies may not be able to eat this cake. At the same time, the effectiveness of the Measures, which was launched in the winter of 2017, is showing. More and more companies—whether they are design institutes or construction companies—are or will be carrying out general contracting business. Optimistic estimates suggest that in another five years, general engineering contracting will account for half of the construction industry. General engineering contracting may be another sign of the evolution of the construction industry.

Another sign of the evolution of the construction industry - the "Reform Plan for the Qualification Management System of Construction Engineering Enterprises" will most likely be implemented in 2022. Starting from this point, with the continuous standardization of relevant policies in the construction industry, in the future Competition in the construction industry will become highly intense, and the phenomenon of “exploitation and prosperity” should become more common.

If we could turn the clock back five years from 2017 to December 2012, we would have seen the bickering between Wang Jianlin and Jack Ma at the "CCTV Economic Person of the Year Awards Ceremony" And the "100 million bet" grand occasion. Looking back now, how proud I was at that time, how sad and sighing now - indeed, "the richest man" is a curse, and mortals cannot take it casually!