Wanda and Vanke reach partnership agreement

The Dalian Wanda Group Co, a global commercial real estate conglomerate, and China Vanke Group, China's largest residential real estate developer, with HQ in the city of Shenzhen, have announced that they will be working together on both domestic and global projects, after signing a strategic cooperation framework agreement in Beijing , on May 14.

The partnership is expected mainly to involve land purchase and project development, with Wanda focusing on the commercial aspect and Vanke on the residential sector to make better use of their respective strengths.

Wang Jianlin (left), chairman of Dalian Wanda Group Co, and Yu Liang, CEO of China Vanke Co Ltd, shake hands after the two real estate developers inked a strategic cooperation agreement on May 14 in Beijing. [Provided to China Daily]

In remarking on the agreement, the chairman of Wanda, Wang Jianlin, said, "Wanda's strategic cooperation with Vanke is a new attempt in the industry, as China's real estate market enters a new phase of balanced supply and demand. And real estate companies need to have a new way of thinking and a new business mode, so Wanda will take this cooperation opportunity to implement its 'asset-light' strategy."

Wang went on to say that the partnership will benefit the industry and society both by utilizing social resources more effectively and cutting waste and might be a model for the whole industry.

The president and CEO of Vanke, Yu Liang, explained the cooperation by saying that although the golden age of real estate is past, traditional businesses still have room to grow in this 'silver age', meaning good opportunities for cooperation between better businesses. Vanke's working with Wanda will help it make full use of the residential sector, improve its commercial real estate capacity, and help it become a support -oriented urban-development service provider.

Vanke differs from Wanda, which specializes in commercial real estate in culture and tourism, luxury hotels and shopping stores, in that it targets commercial real estate in communities to help the residents and make life more convenient.

Yu said "Wanda and Vanke have many things in common in their management ideas and both believe that the mission is to create value for our customers, so we will leverage our respective abilities to face the market and serve customers."

According to the agreement, senior management from both companies will lead the operation and increase communication and exchanges.

The Dalian Wanda Group's Wanda Commercial Properties Co Ltd is the world's largest real estate company, with a gross floor area of 39.04 million square meters (including properties under construction) by the end of 2014.

The Vanke Group is the country's largest residential real estate developer, with more than 210,000 residential units sold in 2014.

Dalian Wanda Group Co and China Vanke Co Ltd ink a strategic cooperation agreement on May 14 in Beijing. [Provided to China Daily]