Those Years When I Was Forced to Top the Forbes List

Chapter 324 Chengdu-Chongqing Economic Belt!
There's a Chinese proverb in Southwest China.

—Easier said than done, like carrying a lamp wick.

So many projects are waiting to be launched, and each one requires money.

Moreover, to complete such a project, everyone had to convert time units into hours, and the project was complex, with no corresponding department in the stock market, so they didn't know where to start.

It's fair to say that after Chen Xuebing gave the order, everyone was completely clueless.

Fortunately, we had Bi Yaxiong, a formidable strategist, who quickly compiled a price list.

In terms of current commercial housing land prices, Chengdu has the highest, at more than 3,000 yuan per square meter, followed by Mianyang, Deyang, Ziyang, and Meishan, ranging from more than 800 to more than 500 yuan. Ya'an is around 400 yuan, while Aba, with its vast land and sparse population, covering an area equivalent to Chongqing, has the lowest average price, at 200 to 300 yuan per square meter.

Wenchuan County is close to the Chengdu metropolitan area, so land prices are higher, around 700-800 yuan per square meter. However, there are two types of subsidies for newly built housing: a basic subsidy of 200 yuan and a subsidy for high-altitude residents (400 yuan/㎡ for rural residents of AB Prefecture). In the end, they are about the same.

However, the construction costs are the highest in Aba, and the transportation costs are very expensive, reaching 2800 yuan per square meter.

In terms of planning, Chengdu aims to have the highest plot ratio, around 3.0, which means building high-rise buildings, with 16 floors or more, and each household having approximately 100 square meters of usable space and 15 square meters of shared space.

The land value in Aba is not high, so the designed plot ratio is the lowest, around 1.5, and seven or eight floors are enough. The usable floor area is 85 square meters, and the common area is 15 square meters. The whole building is advertised as 100 square meters.

According to Chen Xuebing's plan, there will be two projects in Chengdu, four in Mianyang, three in Deyang, two in Ziyang, three in Ya'an, two in Meishan, and four in Aba.

The total land area is approximately 150 million square meters, with a land cost of less than 10 billion yuan.

However, the construction cost is relatively high. With the addition of seismic upgrades, it will be at least 40 billion yuan. In addition, indirect development costs (management/finance/marketing) account for about 15% of the construction cost, and unforeseen expenses account for about 5% of the total cost, bringing the total cost to about 51 billion yuan.

This figure is lower than the 10 billion yuan that Chen Xuebing had expected, because his ideas for Jian'an were higher, and the budget was for a standard apartment of 110-120 square meters. Thinking about it carefully, these days, as long as it is an apartment with an elevator, it is already considered an improved apartment. Many people cannot afford larger apartments.

The shared area is also necessary; otherwise, it cannot compete with the prices of surrounding commercial housing, which would lead to it not being able to sell. If no one lives there, it's all for nothing.

When offering discounts, they must be made in a way that is visible to everyone. Of course, if the shared area ratio is advantageous compared to the average of the surrounding market, it can be used for comparison.

With this calculation, the board members had a general idea of ​​the costs. They estimated that they could start development with about 15 billion yuan, and after acquiring the land for 10 billion yuan, they would pledge 70% of it. The remaining construction could be leveraged with 7 million yuan plus 5 million yuan.

In terms of profit, selling all the properties in Chengdu, Mianyang, Deyang, and Meishan would be enough to break even.

Bi Yaxiong just doesn't understand why they would do a project in AB state, a place with no commercial value, and why they would do four of them. The houses must sell for more than 3500 to break even, which is only 2000 lower than the expected housing price in Chengdu. It's a fifth-tier city, and the selling price is higher than that of Mianyang, a strong third-tier city. He's afraid that they won't be able to sell them and will have to sell them at a loss.

Chen Xuebing couldn't say for sure either.

After thinking it over, the only excuse they could use was that "high-altitude areas are suitable for training teams," which allowed Bi Yaxiong to leave without a clear explanation.

He has no time to explain right now; the wording of his explanation will be determined after the plan is finalized. His priority is to figure out how to solve the problem.

The first problem to be solved is Beichuan in Mianyang, followed by Wenchuan in Aba.

Beichuan is a county town surrounded by mountains and located in a valley. During the earthquake, the surrounding mountains collapsed. It was no longer a question of whether the houses would collapse or not, but that they were buried by the surface rupture caused by the energy release of the Longmenshan fault zone and the collapse of the surrounding mountains.

In Wenchuan, the roads were narrow and nearly 100% damaged, making it almost impossible to access the area for rescue and hindering the golden 72-hour window.

In these two locations, the geological risks far outweigh the construction technology risks, and the problem cannot be solved by building structures; other methods must be adopted.

Relocation is the best option for Beichuan.

Wenchuan is too large. Aba is about the size of Chongqing. Building earthquake-resistant hospitals and schools, and stockpiling safety supplies and medicines locally might be more practical.

The only problem is that it's not easy to find a starting point.

He studied the industrial distribution in both places and suddenly came across a policy.

Document No. 33 of the State Council (2000) clearly states that the construction of infrastructure such as highways and telecommunications should be prioritized in the western region.

Construction costs: Enjoy a 30% subsidy from the central government + reduction or exemption of land transfer fees.

Operating revenue: government-guaranteed lease (8% annual return) + logistics-related income.

The full title of the document issued by the State Council in 2000 is "Notice on Several Policy Measures for Implementing the Western Development Strategy".

Western Development Strategy.

He had hoped to get some projects through this place, but the plan to build a road at a loss yielded little result.

Now, he is beginning to reread this strategy that has lasted for more than two decades.

Two days later, a Coaster bus arrived from the city government and entered the New York Building.

The labor service company on the 42nd floor has become the headquarters of Gu'an Construction Group. It has acquired two companies, Debon Green Building and Licheng Real Estate, and expanded its workforce considerably. In the past few days, many new faces have joined, and although the entire floor has been rented, it still feels very crowded.

"I heard your office is very luxurious, is this all?" Leader Huang looked around at the square offices along the corridor, which were full of people.

“That’s Changzheng Capital upstairs, on the 45th floor. Financial investment banks need to inspire, but engineering companies don’t. It’s better to be serious,” Chen Xuebing said with a smile.

"Now that you're undertaking such a large-scale project, haven't you thought about building your own office building? The city can approve the land for you," Leader Huang tentatively asked.

Chen Xuebing chuckled dryly, not responding.

We will still move, but we'll hold off for now and get the necessary policies first.

Near the end of the corridor, in an office, a loud discussion was taking place.

"This policy allows foreign investors priority in land use! We must make good use of it. I contacted CapitaLand Singapore and used their foreign investment status to acquire land in Chengdu. The land price can be reduced by at least 10%!"

Cai Zhijian's Hong Kong-accented Mandarin came from inside.

Chen Xuebing coughed awkwardly, knocked heavily on the door twice, and then opened it.

Leader Huang led his secretary in and said with no attempt to hide his laughter, "You didn't call me here today just to help you with your real estate plans, did you?"

Cai Zhijian, who was on the sofa, quickly stood up, while Bi Yaxiong, who was behind the desk, hurried over to shake hands and exchange pleasantries with Leader Huang.

"Leader Huang, it's been a long time!"

Leader Huang nodded: "I heard you came to Gu'an. It's a pity that the DC power grid is lacking an expert like you. You should wait a little longer."

He knew about the power grid issue. Although the AC project was approved earlier, the DC project might still have a chance, and the higher-ups were still discussing it.

Bi Yaxiong, however, exclaimed excitedly, "I didn't resign! Chairman Chen agreed to let me stay on. But I'm really looking forward to my current job! It's very meaningful!"

Upon hearing this, Leader Huang glanced at Chen Xuebing and said, "You're quite quick at corrupting cadres."

Chen Xuebing could tell it was a joke, but he smiled and explained seriously, "It's not corruption, but the attraction of dreams. The expansion of private enterprises doesn't need to follow the same steps as state-owned enterprises. Production plans can be adjusted and deployed independently. President Bi has found enjoyment in this job. In terms of state-owned enterprises consistently cooperating with the country's grand infrastructure projects, as long as our private enterprises are large enough, we can also actively participate."

"Oh?" Leader Huang smiled. "Isn't the Western Modern Logistics Industrial Base big enough? You still have spare capacity? How do you plan to participate?"

Today, Chen Xuebing went to the municipal government to find him, inviting him over under the pretext of discussing fundraising for the logistics park. It's such a big deal, and the whole team is very concerned about it, so of course he had to come.

However, on the way, the young man proposed a real estate plan, and he realized that the real intention of the man was not what he seemed.

"The logistics industrial base is financed, but the participation plan we are currently undertaking is funded by our own capital," Chen Xuebing explained.

"How much money do you have?" Leader Huang asked with great interest. Chen Xuebing smiled confidently.

"You must know how much money we have in the stock market, right? The stock market has already risen to 2000 points in the last two days."

At the beginning of the month, the Shanghai Composite Index was still at 1850 points.

In just over half a month, it officially broke through 2000 points.

It's still rising sharply.

Long March Capital is already a factor in all the factors contributing to this price increase.

Previously, during the reassessment of the Long March Fund, the No. 1 and No. 2 funds were liquidated, and the funds returned to their original state, amounting to less than 400 million yuan. However, the No. 3 fund has grown to a full 2 ​​billion yuan.

With an initial investment of 8 million yuan, the Long March TMT Fund now holds 20.56 billion yuan worth of shares in BOE Technology Group, which is currently trading at 6.32 yuan per share.

In addition, regarding that 3G industry fund, he has not yet sought investment from ARM and BOE, because he wants to make more money. At the beginning of the month, he poured 41.3 billion yuan (excluding 7000 million yuan in bank channel fees) into the stock market.

I bought back all the stocks that the fund had previously liquidated, and also heavily invested in Kweichow Moutai and Hudong Heavy Machinery.

What does it mean to have a large stake in Moutai?
At the beginning of the month, Moutai's market value was 400 billion yuan. Chen Xuebing entered the market almost at the threshold for mandatory disclosure of shareholding, acquiring nearly 20 billion yuan.

In the past two weeks, not only has the overall market been soaring, but Moutai has also risen from 53 yuan to 65 yuan, and its market value has increased from 400 billion yuan to nearly 500 billion yuan.

In just over ten days, Chen Xuebing's four funds have generated a floating profit of 9 million yuan this month, even after spending nearly a week re-entering the market.

Based on a 40% self-owned profit, the unrealized profit is 3.6 million.

Chen Xuebing currently holds 76 billion yuan of shares in the Shanghai Stock Exchange, which has a total market capitalization of 5.5 trillion yuan, and 19 billion yuan of shares in the Shenzhen Component Index, which has a total market capitalization of 1.4 trillion yuan.

Such a level of shareholding was very dangerous in the past, but now the sentiment in the A-share market has been ignited, half of the dormant stock market accounts have been activated, new investors are pouring in, and the daily trading volume exceeds 400 billion yuan.

The current stock market has the capability to "withdraw funds at any time." It can basically be done in a day to transfer out one or two billion yuan, and the volume of buyers is very large. If handled properly, it will hardly affect the stock price.

When the era of universal stock trading arrives, unrealized profits will almost equal actual profits.

When Leader Huang learned that Yufu had earned more than 80 million yuan this month, he couldn't help but seriously calculate the money in Chen Xuebing's hands.

When I did the math, I was shocked.

"Your 40 billion or so, plus the 20 billion from the fund, that makes 60 billion, right?"

"A little more, we're still 500 million short of 10 billion."

Leader Huang clicked his tongue: "The amount of liquid funds you control is more than that of the municipal government, and you don't even have to pay taxes on your stock trading profits."

According to current tax laws, even if a company invests in stocks, only the profits from dividends received from holding the stocks are taxed.

"Therefore, we need to invest in the real economy."

Chen Xuebing then moved on to the topic.

"My approach started with the logistics industry base. The other day, I heard you talk about Chongqing's transportation plan for the upper reaches of the Yangtze River Economic Belt, which I think is a great entry point, especially since we will be attracting investment to the logistics industry base. So I started researching this issue, and I gradually discovered that Chongqing's transportation plan is inseparable from Sichuan."

"Hmm." Leader Huang became interested and sat down on the sofa.

Cai Zhijian was about to go out to arrange for someone to pour tea when Chen Xuebing stopped him.

"This issue needs to be discussed in our policy planning office. All the policy materials we've collected are there, right next to us. Mr. Huang, please move over there."

Leader Huang was a little confused.

Policy Planning Office?
You're a private company, why do you even have this department?

But his interest grew even stronger, and he got up and followed Chen Xuebing.

The quiet office actually only has a conference table; it would be more accurate to call it a meeting room.

The table was covered with documents, and there were seven or eight people inside, each with a laptop, typing away.

Upon seeing Chen Xuebing enter, they all stood up.

"Hello, Chairman!"

"Chairman!"

Chen Xuebing waved his hand: "Where's the information on the Chengdu-Chongqing Economic Belt? Give me a copy."

When the leader Huang who came in later heard this word, a look of understanding appeared on his face. He shook his head and smiled, "This is work I only handled a couple of years ago. Why are you showing me the documents? Just tell me directly."

The term "Chengdu-Chongqing Economic Belt" was first proposed in 2003 by an expert from the Chinese Academy of Sciences, intended as a policy supplement to the Western Development Strategy.

The core objective is to build the largest dual-core urban cluster in western China, centered on the two major cities of Chengdu and Chongqing, with interconnected and cooperative central cities at all levels, within the next 5 to 10 years, thus forming the largest strategic support point for the development of western China.

In the following years, it was gradually included in the scope of research.

The two cities are currently planning to sign a comprehensive cooperation agreement next year to define the spatial scope of the Chengdu-Chongqing economic circle, jointly build infrastructure, integrate market systems, coordinate industrial division of labor, jointly govern the ecology, and construct a "Chengdu-Chongqing one-hour economic circle".

To put it bluntly, the eastern regions are all forming conglomerates, such as the Yangtze River Delta, the Pearl River Delta, and the Beijing-Tianjin-Hebei region, which have created a siphon effect on talent and capital. Chongqing, as a core city in the west, is struggling to keep up. Even its "Upper Yangtze River Economic Belt" initiative has received little response. So, it wants to bring Chengdu, the only city in the southwest that can join forces with it, to form a fourth economic growth pole and enhance its attractiveness.

Sichuan considers itself the leader of the west, and it does share this sentiment.

Moreover, everyone's selfish motives are similar: to compensate for each other's weaknesses, so that strong industries can also generate competitive vitality, just like the Pearl River Delta in the last century, developing in fierce competition.

"If Leader Huang understands, then I won't explain further."

Chen Xuebing smiled and took a 64-page national map from the table, unfolding it. The map was covered with lines drawn along the route from Chongqing to Sichuan, and many markings were made next to it.

At a glance, Huang noticed that all the policy numbers were marked with "Western Development".

01: "Chengdu-Mianyang-Deyang-Ziyang-Meishan" urban cluster satellite new city/cluster development.

02: Prioritize land use for infrastructure.

03: Mianyang's "Eleventh Five-Year Plan" Science and Technology City Industrial Belt.

04: National Highway 213 Reconstruction and Expansion – “Minjiang Canyon Corridor” – A Benchmark for Three Gorges Migrants: “Qinghai-Tibet Plateau Regional Ecological Construction Plan”.

The numbering below goes up to "12".

Seeing that all the content revolved around Sichuan, Leader Huang felt momentarily confused and began to have many guesses in his mind.

"This is your investment plan in Sichuan? So, after all this time, your company is planning to move to Sichuan?"

"How could that be!" Chen Xuebing immediately declared his determination: "I'm doing this all for Chongqing's transportation and economic development!"

(Writing in progress, my pig brain is working like crazy)

(End of this chapter)