The property management industry has entered an era of deepening value creation from existing assets. On August 26, CG Services (06098.HK) released its 2026 interim results. Building on its expansive asset base, the company is redefining "quality-driven scale" through productivity restructuring and expansion into specialized service sectors.
Profit reversal and improved cash flow underscore operational resilience. According to the financial report, CG Services generated approximately RMB 24.5 billion in revenue during the first half of 2026, marking a 5.7% year-on-year increase. The asset base continues to solidify, reinforcing its leadership position in the industry. Both gross profit and core net profit attributable to shareholders saw steady gains, with gross profit rising 3.3% to RMB 4.44 billion and core net profit attributable to shareholders growing 3.2% to RMB 1.62 billion. These figures preliminarily validate management's earlier guidance of a profit rebound in 2026. The company maintains ample liquidity, with bank deposits (including cash and cash equivalents, time deposits, and restricted bank deposits) and structured deposits totaling RMB 16.182 billion at period-end. Operating cash flow improved year-on-year, further strengthening its risk resilience.
The core property management segment continues to serve as the "ballast" of performance, consistently contributing nearly 70% of revenue and accounting for almost 90% of revenue growth. Meanwhile, the company's property management scale has grown steadily, with the total number of managed projects rising to 8,576. Fee-based managed area expanded to 1.186 billion square meters, including approximately 90 million square meters under the "Three Supplies and One Service" program. In terms of independence, the company maintains highly market-oriented operations. Revenue from related parties as a share of total revenue has declined steadily from 20.3% in 2018, remained stable at 1.1% in both 2024 and 2025, and further dropped to 0.6% in the first half of 2026—a leading position among major property firms.
The PARA collaborative paradigm takes shape: shifting from labor-intensive tactics to human-machine synergy. Insights from the results briefing indicate that CG Services is pivoting its strategic focus from scale-driven growth to efficiency-driven development. Management stated that the company is systematically advancing the intelligent upgrade of its property management systems, reshaping service processes through the PARA collaborative model that integrates four forces: human, intelligent agents, robots, and AIoT. Under the PARA architecture, humans serve as the primary service providers, intelligent agents enhance management and execution efficiency, robots handle standardized repetitive tasks, and AIoT connects equipment and spaces. This approach converts the scale advantage of over 8,000 projects into operational leverage.
Notably, the company's self-developed "Zero Resident" cleaning robot has been deployed across more than 4,700 building units, with continuous iteration of operational models. Each robot now serves 2 to 5 buildings. Additionally, the company has validated the model across non-residential formats and achieved enhanced ESG benefits through improved energy and water conservation. Consequently, employee roles have undergone a fundamental transformation: project managers have become data insight analysts, and property butlers have shifted from passive order-taking to proactive engagement. One person can now manage up to 100 robots, with the platform dispatching 120 robots daily, requiring only 30 minutes for daily inspections, and expanding management radius tenfold. Meanwhile, the logic of technology-driven cost reduction and efficiency gains is translating into quantifiable financial metrics. In the first half, administrative expense ratio (excluding R&D costs) declined by 1.5 percentage points year-on-year, with administrative expenses reduced by approximately RMB 240 million. Management attributed this decline to platform-based organizational restructuring, strengthened comprehensive budget management, refined cost accountability, as well as process standardization, shared services capabilities, and digital tools that have reduced redundant and low-output management expenditures.
Independent commercial and enterprise operations open a second growth curve. In market expansion, the company added over 600 new contracted and operational projects in the first half, with newly contracted annualized revenue of approximately RMB 1.32 billion, representing 53% year-on-year growth. The urban focus of newly acquired projects continues to improve, with landmark projects secured in Beijing Landiao International Community, Hangzhou Hangchen Xingwanli, and Shanghai Dongfang Haoyuan. Furthermore, in 2026, the company comprehensively upgraded its non-residential business and recently launched an independent commercial and enterprise brand. The commercial enterprise division comprises three sub-brands: Hengyue Space (IFM Business Group), Bikang Medical Services, and Xinhua Zhengda, covering four major tracks: IFM integrated facility management, industrial parks, hospitals and campuses, and aviation ground services. To date, the commercial enterprise service network covers over 20 airports and more than 70 industrial parks, with IFM projects spanning over 10 provinces/municipalities and 18+ cities, establishing a comprehensive cross-sector integrated facility management footprint.
The most notable aspect of this commercial enterprise launch is its digital intelligence core. Leveraging the Group's PARA collaborative paradigm, the commercial enterprise division embeds AIoT, robots, and intelligent agents throughout the non-residential service value chain, bringing technology from the backend to the forefront as replicable, quantifiable productivity. Industry analysts suggest that the commercial enterprise strategy has a clear trajectory, transitioning from residential property scale advantages to professional capability building in non-residential sectors, opening a high-potential incremental market for CG Services.
Community value-added services grow steadily, and ESG ratings reinforce long-term value. While the asset base continues to strengthen, community value-added services are releasing positive signals. In the first half, CG Services' community value-added services revenue reached approximately RMB 2.308 billion, up 18.3% year-on-year, accounting for approximately 9.4% of total revenue. By business segment, core sectors including retail, new energy, and alcoholic beverages recorded substantial growth, with year-on-year increases of 46%, 48%, and 32%, respectively, highlighting the growing value of service-oriented retail. The sustained growth of this segment validates the depth of customer loyalty and provides strong evidence for the company's strategic logic of "seeking incremental value from existing assets."
Particularly noteworthy is the company's focus on governance of older residential communities. CG Services has concentrated on inclusive property services, building community resilience through three circular models: governance cycle, service cycle, and economic cycle. In 2025, the company established the "Yuebaijia" inclusive property brand, which has cumulatively served 227 older communities covering over 200,000 households. Multiple contiguous older communities, including Beijing Chaoyang Panjiayuan Subdistrict and Shanghai Jing'an Linfen San Community, have completed renovation, with the model replicated in Shenzhen, Chongqing, Foshan, Shandong, and other regions.
The company's active ESG practices have also earned broad recognition from international rating agencies. It has been awarded an "AA" rating by MSCI ESG Ratings, a "Low Risk" rating by Sustainalytics, and has been consistently included in the FTSE Russell Social Responsibility Index series for multiple years. As institutional investors increasingly treat ESG as a hard threshold for portfolio allocation, this rating advantage will provide valuation support over the medium to long term.
Long-term, the future of the property management industry belongs to companies that possess both a solid asset base and the capability to manage every square meter effectively. Measured against this standard, CG Services' first-half performance demonstrates: profit recovery validates the resilience of its fundamental business; the PARA strategy points to the potential for productivity restructuring; and market expansion and community value-added services provide growth support from both incremental and existing asset fronts. Against the backdrop of intensifying competition over existing assets, the dual advantages of scale base and operational efficiency may well become its core competitive moat distinguishing it from peers.