Overall, AmCham China member companies in the Real Estate & Development industry are slightly more optimistic than foreign businesses in other sectors regarding the current business climate in China. Industry respondents report that 2015 was a better year in terms of earnings before interest and tax (EBIT) margins than 2014, but that EBIT margins of their company’s China operations were significantly lower than their company’s global margins. Rising labor costs remains the top business challenge followed by shortages of qualified management. Two reasons for expectations of slower growth include difficulties competing against local competitors and the existence of faster growing markets in other geographies. Despite these and other challenges, real estate industry respondents view manufacturing and operations as well as their unique branding as significant competitive advantages over domestic Chinese competitors. 70 percent of industry respondents report that they have hired staff domestically in an effort to innovate in China.
Key Points of this Report:
- 60 percent of respondents characterize their company’s performance in China in 2015 as profitable.
- Rising salary and wage expenses and difficulty attracting skilled executive/managerial staff are the top two human resources challenges.
- 30 percent define the quality of China’s investment environment as “improving.”
Download the full report (free for AmCham China members)
This report distills industry-specific data from the full 2016 BCS Report, reflecting the business climate for this specific industry.
To read more about how Real Estate companies do business in China, visit the AmCham China Business Center.