Gap Idea • Special Investment | Hebei Dream Chasing • Future is Promising
Braving the winds and rains, reaping the rewards of spring and autumn, after five years of hard work, China Zhongji Investment, under the guidance of the Hebei Provincial Federation of Industry and Commerce and with the support and assistance of its shareholders,has long adhered to the core principle of asset allocation strategy, based on policy research and industry fundamentals, putting forward the concept of "niche investment"，driving investment through research, enhancing core competitiveness, and seizing "niche" investment opportunities; at the same time, adding special asset investment to form a comprehensive combination of pro-cyclical and counter-cyclical asset portfolios.
With the passage of time and the renewal of the times, in the five years since its establishment, the company has gradually built a team of high-quality, high-efficiency, market-oriented, and experiencedreal estate and special asset investmentteam. Adhering to the concept of niche investment, it focuses on the revitalization and value realization of existing assets, focusing on the restructuring of physical assets, enterprise restructuring, and other special investment opportunities, paying attention to the value discovery, repair, and enhancement of distressed assets, and achieving a balance between the need for short-term returns during the investment period and long-term capital appreciation.
Against the backdrop of "the convergence of a century of change and a century of pandemic," the real estate industry is also facing reforms. As early as 2018, China Zhongji Investment began to leverage its own advantages to research and explore new business models and directions. Affected by factors such as economic structural adjustment, stricter financial regulation, and strengthened financial asset classification management, the trillion-level non-performing asset market has gradually opened its curtain. While steadily deploying traditional businesses, China Zhongji Investment actively researches policy and market changes, seeks "niche" investment opportunities, optimizes asset allocation, and successfully deployed multiple types of special asset projects based on strict risk control standards and adherence to safety margins.
1. Niche Incremental Real Estate Market:
To prevent involvement in systemic risks in the industry, China Zhongji Investment began to establish an internal professional real estate research team in 2018, repeatedly inviting senior industry experts for exchanges, conducting in-depth research on policies and industry fundamentals, and re-establishing standards and risk control measures for incremental real estate investment projects.
In terms of risk control,stability is paramount，and the company is the first in the industry to propose the "three no" principles: no pursuit of large-scale investment volume, no pursuit of ranking of trading partners, and no pursuit of project track aggregation. It pays more attention to the quality and safety margin of the projects themselves, adopting a comprehensive set of principles for project selection, including risk diversification (mainly small and medium-sized projects) + safety leverage + cash flow dominance + stable and clear entities + comprehensive investigation of controllers + comprehensive and effective risk control; andhoning basic skills and upholding the spirit of craftsmanship, meticulously polishing each project to strive for maximum safety.。
In terms of decision-making, it avoids the competitive business of licensed financial institutions, formulating a niche investment strategy, mainly selecting regional, financially stable, and industry-backed high-quality small and medium-sized developers. To date, the company has deployed in multiple regions including Hebei, Henan, Shandong, Shanxi, Jiangsu, Zhejiang, Sichuan, Chongqing, Hubei, and Hunan, adopting various models such as fixed income and equity fund floating income, with a total investment of approximately 30 projects, such as Jiaxing Lanson Green Oasis Jingyuan, Shijiazhuang Contemporary Chenyue, Zhengzhou Guotai Zijinyuan, and Zhongji Anrui No. 2, Anrui No. 3, Shangrong No. 1 Selection, and New City Construction No. 2, and other private equity funds. The comprehensive static average annualized return rate exceeds 20%, with some projects exceeding 30% or even higher,with no systemic risks.At a time when the real estate industry is undergoing fundamental structural changes, the project risks are ultimately controlled at the level of partial liquidity, which also reflects the craftsmanship of Zhongji people,gradually forming a differentiated model of comprehensive development and mutual benefit of "capital + land + brand agency construction output"。
2. Special Opportunity-Type Non-Performing Asset Market：
Special asset investment is a typical counter-cyclical adjustment industry. With the rotation of the economic cycle, risks such as bank non-performing loans and defaulted equity pledges are exposed. The special asset industry, with its ability to improve asset utilization efficiency and help rediscover resource value, has also ushered in a huge window of opportunity.
Unlike traditional non-performing asset investment that relies on buying low and selling high for arbitrage, China Zhongji Investment focuses on the value discovery, repair, and enhancement of distressed assets and distressed enterprises in the non-performing asset field, exploring a development model of revitalizing existing assets and shaping value, usinginvestment banking methods，building aNon-performing assets +…composite and professional team. Currently, the company has deployed special assets in Hebei, Zhejiang, Shandong, and Tianjin, and from "collection" to "operation," it has invested in and disposed of businesses in areas such as enterprise restructuring, distressed real estate, non-performing asset mortgage loans, and asset packages, creatinga special asset ecosystem，improving the efficiency of non-performing asset disposal, and achieving innovative operations.
For example,enterprise restructuring projects:A local group manufacturing and well-known brand enterprise in Qingdao was forced to shut down due to debt problems. China Zhongji Investment and its partners, through the separation and revitalization of its multiple debts and creditors' rights, redefined the enterprise restructuring plan, relocation plan, and operation plan, enabling the enterprise to resume normal operation; with the support of the court and the government, the core assets of the restructured enterprise benefited from realization and appreciation. This restructuring solved a major problem for the local government for many years and solved the employment problems of hundreds of employees,creating a win-win situation for "capital + distressed enterprises + government," and the China Zhongji Investment brand has also received recognition and affirmation from society and the government.。
Resolving distressed single non-performing asset projects:The project land is located in Tongxiang City, Zhejiang Province. The land-owning company has numerous debts, resulting in the land being mortgaged, sealed, and the company's equity being frozen. China Zhongji Investment, by sorting out the relationship between non-performing debts and creditors' rights, and by communicating with the local government and relevant courts, has developed a comprehensive solution and restructuring logic and strategy for non-performing debts, legally appraising the subject land and auctioning it to obtain income and comprehensively resolve debts and creditors' rights; at the same time, China Zhongji Investment builds a special asset ecosystem, accurately introducing partners to adopt a structured financing model, participating in auctions to acquire assets, participating in the entire chain of the project's development and operation, and obtaining equity income from project operations.
This project is a full-chain debt solution, including pre-auction debt sorting, auction process, debtor bankruptcy early warning handling, tax handling, invoice handling, planning and design changes, cross-border municipal supporting facilities, handling of force majeure caused by the epidemic, etc., ultimately achieving debt resolution and participating in equity investment,achieving the revitalization and re-operation of existing distressed assets and value enhancement.。
Bank Non-Performing Asset Mortgage Loan ProjectBank's internally generated overdue mortgage loan assets, where the borrower's loan is overdue and in default, and the property mortgaged to the bank has mortgages and multiple seizures, requiring a capable disposal party to handle it. China Zhongji Investment acquires the debt rights of overdue mortgaged properties from banks, achieving profit and exit through reconciliation, litigation, and judicial auctions.Resolve non-performing assets arising from mortgage loan businesses of banks and other financial institutions, and revitalize the properties by releasing the mortgages.。
Meanwhile, Zhongji is deploying in banks/AMCs.Asset package debt rights acquisition and disposal projectIncluding various types such as mortgage-type and guarantee-type, strategic and customized packaging is conducted. Cooperation with AMCs and strategic service providers is established for bulk acquisition and disposal of debt asset packages. Currently, in-depth research and deployment of asset packages are underway in Shandong, Tianjin, Hebei, and Henan, ultimatelyResolving bulk non-performing asset debt rights of AMCs/banks, and revitalizing existing assets and related distressed enterprises.。
In summary, we are in a challenging era, with the global economic landscape undergoing profound changes, and the real economy and financial system are comprehensively adjusting to cope with external changes. China Zhongji Investment will continue to uphold the philosophy ofDiscovering opportunities, creating valuewith "Niche + Special Investment" as a lever, in the field of real estate and special assets business, relying on the courage and perseverance of Zhongji people to forge ahead, the future is promising!
