Chapter 518: The Reception Expenses Were Not Wasted
The Valentino store is under construction and the entrance is blocked.

Fan Wumian did not go in to check the progress of the renovation. He only remembered that the store had a total area of ​​more than 400 square meters. Not only did Mr. Wang help waive the rent for three years, but he also gave a 5% discount on the subsequent rent.

Every high-end shopping mall hopes to cooperate with major luxury goods companies to enhance its overall image and attract more wealthy consumers to shop.

Due to the large number of high-end shopping malls that have opened in recent years, some shopping malls have offered “permanent rent-free” conditions just to invite foreign brands such as LV, Gucci, Dior, and Chanel to move in.

Ever since Valentino held its new product launch last month and became a hit in the global fashion industry, many shopping mall owners have invited Fan Wumian to open a store there. Their attitudes were so humble that they would rather pay for the decoration costs just to invite him to open a store.

A businessman cannot afford to be too early if he has no profit.

The reason behind such positivity is, of course, that the entry of high-end luxury brands will bring many benefits to the mall itself.

Although providing rent-free periods will reduce rental income, in the long run, the customer flow and consumption power brought by these brands can increase the overall rental level and profitability of the mall.

Over time, Fan Wumian’s appetite has become spoiled. If the mall does not waive the rent for more than three years, there is basically no possibility of allowing Valentino to move in.

In Building 19, The Bund, which is next to the Peace Hotel, the entire first floor was taken over by Fan Wumian. It will be used as Valentino’s flagship store in East China in the future and is also in the decoration stage.

There is also Plaza 66. Fan Wumian knew that the locals were willing to spend money and there were many tourists from other places, so he arranged three stores in Shanghai alone.

As of now, Valentino has selected a total of 28 locations in Greater China, including Hong Kong, Macau and Taiwan, and the average cost of opening a store is estimated to be around 170 million yuan.

In addition, island countries, Singapore, Thailand, South Korea, London, Paris, Berlin and other places also need to invest in expansion. If the new products do not sell well after release, Fan Wumian will have a headache about how to raise funds.

In contrast, the “Holy Flame Meow Meow” brand, which was founded casually, is now expanding everywhere. Its stores are divided into three categories: “cat cafes”, “coffee shops” and “milk tea shops”. The first two are open to external franchising, and there are more than 40 of them across the country, while the milk tea shops are all owned by Fan Wumian himself.

The reason for the different treatment is obviously because self-operated milk tea shops are more profitable. The average investment cost does not exceed 11 yuan, and each store employs 4 to 6 employees. With the current brand popularity, it only takes a few months to recover the cost.

Earlier, Fan Wumian specially set up a management team and tried to open several stores in Yanjing. He found the performance was good, so he has opened more than 10 directly-operated milk tea shops in the mainland, and also went to Tsim Sha Tsui and Causeway Bay to select locations for opening stores. Recently, every time a user collects stamps, he can redeem a cup of milk tea for free.

After accumulating experience and getting more funds, the expansion speed will be even faster next year. A few days ago, Fan Wumian sent an email to the person in charge, setting a small goal of expanding the number of directly-operated milk tea shops to 2007 in 150.
I was distracted and dazed, accompanying Mr. Wang and Zuo Ziyan’s parents on a tour.

After hearing Mr. Wang’s own remarks, Fan Wumian learned that he started his business in the late 80s, and three years later, in 1992, his net worth had exceeded 1 million RMB.

The 1 million at that time was not the 2006 million in 1. The purchasing power was much stronger than it is now.

In this light, it is no wonder that Mr. Wang always regards “1 million” as a small goal on the road to success, or that sentence is actually said to businessmen who have achieved some success and has little to do with wage earners.

Thinking of this, Fan Wumian was reminded that he should be more careful in what he said and did in the future, otherwise it would be easy for others to catch him and magnify the small matter into a hidden stab in his back.

At this moment.

After Zuo Ziyan’s father inspected the situation, he said:

“Sure enough, I’ve visited Harbour City. It’s very similar to the commercial complex in Hong Kong. Your company is quite strong, but the debt ratio is really high.”

“In Hong Kong, when developing a new property, the self-owned funds must reach 90% before construction can begin, so we often cooperate in development, which is too stressful.”

“Real estate developers in the mainland first buy a piece of land, and then go to the bank for mortgage after obtaining the land certificate. I heard that many developers have very little capital of their own, which really makes me envious.”

On the way here, Fan Wumian mentioned that some office buildings were sold directly for a higher price after they were built.

Assuming a cost of 5 million yuan and a net profit of 5000 million yuan in the end, the rate of return seems to be only 10%. But in fact, the actual capital invested by the developer may be only 1 million or 1.5 million yuan. Using this figure for calculation, the actual rate of return has increased several times.

High returns are accompanied by high risks. When real estate developers expand with leverage, their profits will be magnified when things are going well. However, once they encounter certain crises, their losses will also be magnified.

The situation in the commercial real estate sector is not so bad, but some residential projects are really outrageous. Many developers get pre-sale certificates illegally, collect money from owners first and then develop the property. Once the bank stops lending or the developer runs into problems, the risk is too great.

The Hong Kong real estate market suffered losses in this matter, so restrictions on developers have been increased.

If it stayed in Hong Kong to develop, the more than 20 billion Hong Kong dollars in cash it received from the sale of office buildings on Zuo’s Real Estate’s books could only be used as to billion Hong Kong dollars.

However, if this money is brought to the mainland and invested in the real estate market, it can be leveraged to launch large projects worth tens of billions of Hong Kong dollars. It is precisely because Zuo Ziyan’s father sees the huge business opportunities therein that he expresses envy.

Mr. Wang was worried that he might miss out on a big money sponsor, so he quickly explained:
“The financial situation of our Wanda Group is already very good. If we are lucky enough to cooperate with Mr. Zuo and Mr. Qiu, the financial situation will be even better.”

“There is no need to worry too much about the risks. I mentioned before that last year we sold nine first- and second-generation Wanda Plazas to Australia’s Macquarie Investment Management Group, raising more than 9 billion yuan in total and paying off most of the bank loans.”

“The core now is this mall and the new mall in Ningbo. In the future, they will develop into third-generation or even fourth-generation large-scale complex projects and expand only in the core areas of big cities.”

“Mr. Fan should have some experience in this matter. I have studied the land near Shenzhen Bay. The location is quite good and the planning is also reasonable. Shenzhen has many rich people, so we should build more sea view houses. As for shopping malls, many people go directly to Hong Kong City or Macau City for consumption and tourism, so the competition pressure is a bit high.”

Looking around, I check out the brands that have settled in the mall.

Seeing that the topic was suddenly brought up to himself, Fan Wumian smiled and said:
“Mr. Wang’s vision and ability are quite impressive. I just went to Wanda Plaza in Yanjing. It had a lot of customers.”

“Although the per capita income in the mainland is not high, there is already a cliff-like gap between the young and the middle-aged and elderly. More and more middle-class and high-income people are settling in big cities, and they always need to find a place to go shopping and spend money.”

“When I finish my latest project, if I have some spare money, I can also raise funds to acquire some shares, such as co-developing a shopping mall in Shenchengwan. Of course, it’s definitely not possible in the short term, as my side is still a wasteland.”

Hearing this, Mr. Wang felt very relieved and thought that the more than 200,000 yuan spent on entertainment last night was not wasted.

The more Zuo Ziyan’s parents looked at Fan Wumian, the more they felt satisfied.

Ms. Qiu smiled and said:
“It’s a wasteland now, but it may not be the same in the future. Since you bought it, the land should have appreciated by 20 to 30 percent, right?”

“Based on the increase in housing prices, it should be about the same. Once I find a way to make more money, I need to quickly pay the land transfer fee and modify the plot ratio and design plan. I’m afraid the price will continue to rise sharply in the future.”

Fan Wumian didn’t feel comfortable saying too much, he just joined in the fun.

From what Zuo Ziyan’s parents said, it seems that they are very interested in investing in Wanda Group, otherwise they would just take a look and wouldn’t ask so many detailed questions.

During this period, when I learned about the purchase of the villa, Mr. Wang also helped to make a phone call to the person in charge of the relevant unit and made an appointment to go directly to transfer the ownership in the afternoon.

After visiting.

Zuo Ziyan’s parents took Fan Wumian to take a look at No. 8888 Julu Road.

The urban infrastructure has not caught up yet, and some old residents nearby have no money to maintain it, resulting in the surrounding environment being a bit shabby, just like the northern edge of Houhai. Once the surrounding renovation is completed, the house price will not be what it is now.

The Qiu family ancestral home has been completely renovated and has become quite tasteful, exuding a sense of literary elegance everywhere.

Having never lived in this ancestral home, Zuo Ziyan’s mother has no regrets about it. She only feels that if the house is moved to the top of the mountain in Gangcheng, its value may increase tenfold.

After looking up and down the stairs, I still decided to buy this place. After hiring someone to clean it, I can buy some daily necessities and move in.

After completing the transfer through a special channel, it was just after 4 o’clock in the evening when Zuo Ziyan’s parents handed him the key to the old villa on Julu Road in advance.

Immediately afterwards, Fan Wumian began to look for someone to clean the house and personally went to the mall to select bedding, tableware, electrical appliances and the like.

I kept shopping until about 6 o’clock, and was invited by Mr. Wang to continue the dinner.
(End of this chapter)