The official launch of Colour Life Residence marks acceleration of Fantansia’s community service business ecosystem strategy

(6 July 2015 -Hong Kong) FantasiaHoldings Group Co., Limited (“Fantasia”, or the “Company”, which togetherwith its subsidiaries referred to as the “Group”; HKEx stock code: 1777), ispleased to announce its sales updates for June 2015, as well as the official launchof Colour Life Residence that aims at connecting and integrating the existing industrychains and accelerating Fantasia’s community service business ecosystem strategy.

Colour LifeServices Group Co., Limited (“Colour Life”; HKEx stock code: 1778), a subsidiaryof Fantasia, in celebration of its first anniversary as a listed company on 30June 2015, announced the official launch of Colour Life Residence. This marksthe first time in the property development industry in China a transformationfrom a developer and seller of real estate to an all-rounded provider of communityservices. This is an attempt to bring the real estate industry back to its fundamentalattribute of serving people, aiming at accommodating the era of big consumptiondevelopment trend in Mainland China better.

Colour LifeResidence is essentially an attempt by Colour Life to establish a mutuallybeneficial and win-win cooperation model through integrating numerous communitybusiness participants including property developers, financial institutions, retailtenants and suppliers of vertical applications, etc. The service offerings areto be distributed under a unified brand name “Colour Life Residence”. Propertyowners are allotted in large volumes long-term consumption rights vouchers,which can used on the mobile application platform Caizhiyun for massconsumption items covering clothing, food, lodging, transportation, travelling allthe way to home refurbishments and automobiles, etc.

This Colour LifeResidence model is set to mark another profound change for the propertyindustry in China. Just as Xiaomi that seeks to profit from Internet services witha biased emphasis on services over handsets; Qihu 360 that seeks to profit frominternet users with a biased emphasis on users over software; and Apple thatseeks to profit from the user platform with a biased emphasis on platform overhardware, Fantasia is now establishing a business model that seeks to profitfrom platform and services. This model marks a migration of the role of propertydevelopers from selling flats to selling services, and community propertymanagement enterprises become strong integrator of industrial chain instead ofindustry affiliate.

At the moment, ColourLife Residence 1.0 is currently conducting the first batch of beta launches inFantasia Town, Phase Two in Wuhan and Kang Tow, Phase Three in Huizhou.Property developers, business partners and financial institutions including asSF Express, JD.com, Ping An Bank, An Bang Insurance, China Minsheng Investment,UnionPay, Tenpay, Shanghai Wejoin Investment, Wuxi Lakeview Park Real EstateCompany, Xi’an Rongxin Holding Company and Jiangsu City Property Group(江蘇城置集團) have signedcooperation agreements with Colour Life.

The industry andbusiness partners are optimistic about the development prospects of Colour LifeResidence. Under this model, property developers will transform the one-offproperty purchase behaviour into community consumption behaviour that will lastfor 70 years. High home prices are thereby lowered by regression and homebuyers become the largest beneficiaries. This will also bring mutual benefitsand create a win-win situation with business partners on Colour Life communityservice platform.

Fantasia’sChairman and CEO, Mr. Pan Jun, said that the launch of Colour Life Residencemarks an important step in speeding up the development of a community businessecosystem. The Company is currently adopting a “Community +” strategy whichconsists of “4 big communities + 4 big applications + social media platform +big data centers”. This strategy will connect and integrate numerous resourcesin external traditional and new industries comprehensively through a communityservice platform, in order to create a community business ecosystem that isbased on communities and families, open to sharings and creating win-winsituation with business partners.

Taking Tencent’sopen ecosystem business model as a reference, the Group promotes company-widecross-sector synergies to achieve organic amalgamation of its financialservices, community services, healthcare and elderly services with the communityservice platform of Colour Life while introducing into it external businesses.The Group cooperates with enterprises such as Mengniu, SF Express, JD.com, Jinguyuan(金谷園)andLittle Bunny Professional Dry Clean and launches a variety of value-addedservices including e-Wealth Management and e-Rental. The Group also opensaccesses to its platform from renowned suppliers such as Lenovo and ChinaTelecom. This lays a good foundation for the model’s large-scale replication inthe next stage.

On 29 June, ChinaMerchants Securities issued a research report that says Colour Life has becomea well-known pillar high growth enterprise in the property management industry inChina. Haitong Securities also considers that the establishment of a businessecosystem will improve operating efficiency, lower the costs and accomplishbetter value-add on properties via the Internet platform based on big data. Inaddition, Citibank, which has raised its target price for Fantasia’s shares, pointsout that pioneering a business model transformation, Fantasia has been enjoyingsuccesses from an optimized scale of property development business and exploitedsynergies generated from the new businesses.  

On real estate developmentsegment, the property market in Mainland China continues to revive and persistentgrowth is seen in the Group property sales. In June 2015, the Company achievedcontracted sales of RMB801 million with 101,302 sq.m. in aggregated gross floorarea (“GFA”) sold , up 80.88% and 60.12% year on year, respectively. As of 30June 2015, the accumulated GFA sold year to date in 2015 was approximately548,011 sq.m. and the corresponding contracted sales aggregated approximatelyRMB4.047 billion, representing increases of 92.88% and 124.84%, respectively,year on year. The Company is optimistic about its annual sales results.

During thepresentation of “Research Results of Top 100 Property Service Providers inChina” held on 12 June in Beijing, Colour Life scooped various awards including“2015 Top 10 All-round Property Service Providers”, “2015 Top 10 PropertyService Providers in terms of Growth”, “2015 Top 100 Property Service Providerswith Leading Customer Satisfaction” and “2014 World’s Largest Community ServiceProvider in terms of Residential Property Area Managed”.

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