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The information and statistics set out in this section have been extracted and derived from various official government publications, publicly available sources, private publications and from the market research report prepared by JLL, which was commissioned by us, unless otherwise indicated. We believe that the sources of this information and statistics are appropriate sources for such information and statistics and reasonable care has been exercised by our Directors in extracting and reproducing such information and statistics. We have no reason to believe that such information and statistics are false or misleading in any material respect or that any fact has been omitted that would render such information false or misleading in any material respect. None of our Company, the Joint Sponsors, the [REDACTED] or our or their respective Directors, officers, employee's, representatives, agents, affiliates or advisers have independently verified such information and statistics. Accordingly, none of our Company, the Joint Sponsors, the [REDACTED],the [REDACTED], the [REDACTED], or our or their respective Directors, officers, employee's, representatives, agents, affiliates or advisers or any other parties involved in the [REDACTED] makes any representation as to the accuracy and completeness of such information and statistics. Certain information and statistics included, including those excerpted from official and government publications and sources in , may not be consistent with other information and statistics compiled within or outside China by third parties. As such, the official and non-official sources contained herein should not be unduly relied upon. Furthermore, due to the inherent time-lag involved in collecting any industry and economic data, some of the data contained in this section may only represent the state of affairs at the time such data were collected. As such, you should also take into account subsequent movements in the industry and the economy in the PRC and elsewhere when you evaluate the information contained in this section.

SOURCES OF INFORMATION

In connection with the [REDACTED], we commissioned JLL, an Independent Third Party, to prepare the industry research report with necessary information on the industrial park development and operation market in China and the regions in which we operate. JLL has charged us a total fee of approximately RMB435,000 for the preparation of the industry research report, which we believe is in line with the market rate for similar reports.

JLL is an international professional services and investment management firm offering specialised real estate services to clients seeking increased value by owning, occupying and investing in real estate. JLL has more than 330 corporate offices, operates in more than 80 countries and has a global workforce of more than 91,000 as of December 31, 2020.

This section was prepared primarily by JLL’s designated market research team based on the information and statistics collected from various government publications, site visits and interviews, recognised research institutions, and the proprietary database of JLL. The information and statistics are considered reliable.

The following sets out the main reasons for JLL to adopt the above sources of information and consider them as reliable: it is a general market practice to adopt official data and announcements from various Chinese government agencies, and JLL understands the data collection methodology and data source of its proprietary database and the subscribed database from CEIC (a macroeconomic database founded in 1992) and CREIS (a Chinese property research database operated by China Index Academy).

While preparing this section and the JLL Report, JLL has relied on the assumptions listed below: (i) all documents provided by our Group are true and correct; (ii) all published data by

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Our Directors confirm that, as of the Latest Practicable Date, after making reasonable enquiries, there is no material adverse change in the market information since the date of JLL Report or the date of the relevant data contained in the JLL Report which may qualify, contradict or have an impact on the information in this section.

OVERVIEW OF THE MACRO ECONOMY AND MANUFACTURING MARKET IN THE PRC

The nominal gross domestic product (GDP) of the PRC has grown from RMB68,886 billion in 2015 to RMB101,599 billion in 2020. In 2019, the real GDP growth rate of the PRC was 6.1% and fell to 2.3% in 2020 due to severe impacts of the COVID-19 pandemic. According to the Report on the Work of the Government 2021 (“2021 政府工作報告“), the GDP growth rate of the PRC is forecasted to reach 6.0% or above in 2021. Accelerating the building of a new development pattern and promoting high-quality development will become the major goal and task of PRC economic development.

As one of the major components in the industry sector, the manufacturing industry contributed a GDP of RMB2,659.4 billion in 2020, accounting for 26.2% of the GDP and 84.9% of the industry sector in the PRC. According to the National Statistics of the PRC, the PRC manufacturing industry has consecutively ranked first among the other countries’ manufacturing industries across the world for 11 years in terms of manufacturing GDP. Therefore, the manufacturing industry is an important driver for the PRC economic growth. To ensure the modernization and securitization of the PRC manufacturing industry in the internal and external industrial supply chain system, promoting the high-quality growth of the manufacturing industry becomes a major strategic goal in the PRC “New Development Pattern” stage (中國”新發展格局”階段).

OVERVIEW OF MANUFACTURING INDUSTRIAL PARK DEVELOPMENT AND OPERATION MARKET IN THE PRC

Overview of Industrial Park Development in the PRC

According to the definition of the United Nations Environment Programme (UNEP), an industrial park refers to a region where, through various means such as administration or marketization, the government of a country or region delimits a zone, formulates development plans and policies, constructs and improves various environments suitable for industrial enterprise agglomeration, and makes the industrial park a modern industrial zone and an effective carrier for industrialization and cooperation with high degree of industrial agglomeration, distinctive industrial characteristics, obvious cluster advantages and complete functional layout.

There are over 59,000 industrial parks with a total GFA of over 2.9 billion sq.m. in the PRC by the end of 2020 according to the JLL Report. It is anticipated that the total GFA of industrial park market will reach 4.4 billion sq.m. in 2025 driven by continued economic growth of the PRC

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Definition of Manufacturing Industrial Park Developer and Operator

Manufacturing industrial park developer and operator is defined as an individual entity who acquires industrial land for developing and operating plants and standard factories with the characteristics of manufacturing agglomeration. The developers and operators mainly engage in industry research and planning, industrial park development, marketing and sales of industrial parks as well as comprehensive industrial park operational services.

Business Model of the PRC Manufacturing Industrial Park Development and Operation Market

The objective of manufacturing industrial park developers and operators is to set up parks with manufacturing clusters to meet the development needs of manufacturing enterprises. Manufacturing enterprises, particularly technology intensive enterprises, can gain benefits such as technology spillover through cluster effect. Moreover, for manufacturing enterprises (especially small- to mid-sized enterprises which accounted for 96.6% of total number of manufacturing enterprises) in the PRC, the increased difficulties in the cycle of land purchasing and plant self-building significantly affect their industrial agglomeration and industrial upgrading process, and further limit their opportunities for high-quality development.

Therefore, the core elements for manufacturing industrial park developers and operators include in introducing various industry resources to meet the needs of corporate customers. Such process involves manufacturing industrial park developers and operators, manufacturing decision-makers and local governments. Therefore, it is crucial to introduce manufacturing entities resources at the early stage of the manufacturing industrial park development.

During the process, manufacturing industrial park developers and operators usually cooperate with local governments to develop manufacturing industrial parks by entering into investment agreements. After the development, marketing and sales, and settling manufacturing customers in the industrial parks, manufacturing industrial park developers and operators will continue to operate the industrial parks and provide services.

As a result, the manufacturing industrial park developers and operators could generate revenue from multiple businesses such as property development and sales, property leasing, comprehensive industrial park operational services, industrial services, industrial investments, among others. As the development of manufacturing industry enters the stage of industry upgrading and high-quality development, various comprehensive industrial park operational services in addition to sales and leasing of properties constitute new growth engine to the developers and operators which have inherent advantages to develop these businesses. As impacted by industrial environment and government policies, the comprehensive industrial park operational services provided by the PRC manufacturing industrial parks will also meet the agglomeration trend of manufacturing industry development.

Overview of PRC Manufacturing Industrial Park Development and Operation Market

According to the definition of manufacturing industrial park developers and operators, in 2020, there are nearly 100 typical manufacturing industrial park developers and operators with

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The growth of the manufacturing industrial park development and operation market in the PRC is driven by the increasing demand for highly standardized production, encouragement for industrial park operation by regulatory policies, growing land acquisition and operation capabilities of developers and operators, and diverse land acquisition methods, such as acquisition of other industrial land projects to be transformed into manufacturing industrial parks. As such, the manufacturing industrial park development and operation market in the PRC is expected to maintain rapid growth with a CAGR of 25.9% from 62.7 million sq.m. in 2020 to 198.4 million sq.m. in 2025.

The chart below sets forth the total GFA and anticipated total GFA1 of the PRC manufacturing industrial park development and operation market.

The total GFA of the PRC manufacturing industrial park development and operation market (2015-2025)

Total GFA

(million sq.m.) 250

200

150

100

50

0 2015 2016 2017 2018 2019 2020 2021E 2022E 2023E 2024E 2025E

Source: JLL

The manufacturing industrial parks of these developers and operators are mainly located in industrially agglomerated regions such as the Yangtze River Delta Region, the Region, and the Bohai Economic Rim which accounted for 29.5%, 15.6% and 24.0%, respectively, of the total GFA of the PRC manufacturing industrial park development and operation market. The three regions accounted for 69.0% of the total GFA of the PRC manufacturing industrial park development and operation market in aggregate by the end of 2020.

Manufacturing industrial park developers and operators can be categorized into four major types according to their characteristics. The chart below sets forth the types of manufacturing industrial park developers and operators by total GFA in 2020.

1 The statistics is based on the total GFA of manufacturing industrial park projects. Projects include sold projects, completed projects, projects under development, as well as projects which have acquired land use rights with manufacturing agglomeration and are clearly scheduled for manufacturing.

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The market share and characteristics of market players in the manufacturing industrial park development and operation market in 2020 Market share by Type total GFA Professional Developer and Operator 75.8% Government Platform Enterprise 15.8% Manufacturing Enterprise 5.5% Industrial Branches of Tertiary Educational Institutes 1.8% Others 1.1%

Source: JLL

Among them, the share of professional developers and operators increased from approximately 68.4% in 2015 to approximately 75.8% in 2020 in terms of total GFA and is expected to achieve 84.0% in 2025 due to the increased complexity in the industry.

OVERVIEW OF MANUFACTURING INDUSTRIAL PARK DEVELOPMENT AND OPERATION MARKET OF SELECTED REGIONS IN THE PRC

Yangtze River Delta Region

The Yangtze River Delta Region covers 41 municipalities across , as well as , and provinces. From 2015 to 2020, the nominal GDP of the Yangtze River Delta Region increased rapidly with a CAGR of 8.1% and reached RMB24,471 billion in 2020.

The total GFA of manufacturing industrial park development and operation market in the Yangtze River Delta Region reached almost 18.7 million sq.m by the end of 2020. The total GFA of Jiangsu’s manufacturing industrial park development and operation market accounted for approximately 47.8% of the total market, ranking first in the Yangtze River Delta Region, followed by Zhejiang’s, which accounted for 35.1%. At the city level, , Shanghai, and possess higher total GFA of manufacturing industrial parks mainly due to their flourishing economy and booming manufacturing. Our Group had entered into 17 cities and ranked third in this area in terms of total GFA of manufacturing industrial parks by the end of 2020.

Pearl River Delta Region

The Pearl River Delta Region covers nine municipalities in province, including , , , , , , , and . The nominal GDP of the Pearl River Delta Region grew steadily from RMB6,254 billion in 2015 to RMB8,952 billion in 2020 with a CAGR of 7.4%.

By the end of 2020, the total GFA of manufacturing industrial parks in the Pearl River Delta Region exceeded 9.4 million sq.m. The total GFA of Shenzhen’s manufacturing industrial park accounted for around 32.0% of the total regional market, ranking first in the Pearl River Delta Region, and the total GFA in Foshan accounted for 25.4% of the total regional market. In addition, the total GFA of manufacturing industrial parks in cities with manufacturing clusters such as Dongguan and Huizhou are relatively large. Our Group had entered into five cities and ranked second in this area in terms of total GFA of manufacturing industrial parks by the end of 2020.

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Bohai Economic Rim

The Bohai Economic Rim covers , , province, province, and province. The nominal GDP in the region increased from RMB13,917 billion in 2015 to RMB18,464 billion in 2020, representing a CAGR of 5.8%.

The total GFA of manufacturing industrial parks located in the region was 14.4 million sq.m. by the end of 2020. 31.8% of the manufacturing industrial parks were located in Tianjin, and about 24.9% of the manufacturing industrial parks were located in Shandong province. Our Group entered into 11 cities and ranked second in this area in terms of total GFA of manufacturing industrial parks by the end of 2020.

OUTLOOK AND GROWTH DRIVERS

Future Trend of Manufacturing Industrial Park Development and Operation Market

A growing number of developers and operators play active roles in the value chain of manufacturing industrial park development and operation, such as administrative agency, to continuously support the development of the manufacturing industry while governments implement incentive policies with respect to high-quality development of manufacturing services.

To cater to the development demand of manufacturing enterprises, the business model is in the stage of continuous innovation, such as transforming from simple park management to provision of comprehensive industry services, and the main types of services are expanded from sales and leasing of properties to value-added services to support development of manufacturing enterprises. Taking into account the different characteristics of enterprises, developers and operators try to add customized space services based on the previous positioning of different industries within an industrial park. Therefore, well-known developers and operators, such as our Group, will be able to further explore market opportunities by providing comprehensive industrial park operational services.

Agglomeration in regional manufacturing clusters simultaneously influences the development of manufacturing industrial parks and the strategies of operators. Developers and operators focus more on the three major regions where enterprises are concentrated. Firstly, the three major regions have sufficient talents and it can be easier to attract talents from these regions. Secondly, expansion to neighboring cities can be witnessed in first-tier cities and the criteria for classification of city tier are based on the research conducted by YICAI (第一財經). Therefore, lower tier cities around first-tier cities tend to be a similar option to manufacturing industries considering the spillover effect and strict land supply orientations in first-tier cities.

The cost of development and operation of industrial parks is expected to increase, among which, land cost typically accounts for a significant proportion of operators’ costs, and has kept rising in recent years. The growth rate of the industrial land sold is expected to remain relatively high in line with the growing demand for development space in the manufacturing industry. However, the government intends to increase the efficiency of industrial land use and control the land price within a reasonable range for industry-oriented development. It is anticipated that the average land cost will continue to grow at a moderate pace with an increase of 4.0% in the foreseeable future. According to JLL, the average selling price of industrial land in the PRC is likely to rise from RMB445 per sq.m. in 2020 to RMB541 per sq.m. in 2025.

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Future Growth Drivers

Manufacturing Upgrading and High-quality Development

There is a tendency to transform manufacturing enterprises from low-end to high-end. According to the National Bureau of Statistics, the growth rate of output value of strategic emerging industries in the industry sector reached 8.4% in 2019, representing an industry upgrading and high-quality development trend in the manufacturing sector. Based on several national guidelines about high-end manufacturing and strategic emerging industries, standard facility construction for these manufacturing enterprises, especially those engaged in strategic emerging industries, is regulated and supported by the state. The benefits from industry agglomeration include promoting the agglomeration of high-quality productive participants, increasing economies of scales, stimulating the creativity of production research, and linking the industry chain from upstream to downstream.

Policy Supports

Manufacturing and relevant industrial parks enjoy policy supports. For industrial clusters and upgrading, the “Central Economic Work Conference in 2020” (二〇二〇年中央經濟工作會議), the Report on the Work of the Government in 2021《二〇二一年政府工作報告》 ( ) and The CPC Central Committee’s Proposals for Formulating the Fourteenth Five-Year Plan for National Economic and Social Development and the Long-Range Objectives Through the Year 2035《中共中 ( 央關於制定國民經濟和社會發展第十四個五年規劃和二〇三五年遠景目標的建議》) have been published by the PRC governments intensively during the period from December 2020 to March 2021. In addition, in July 2020, 17 departments of the State Council jointly published the Opinions of Seventeen Departments on Perfecting the System of Supporting the Development of Small- to Mid-Sized Enterprises《十七個部門關於完善中小企業發展支持體系的意見》 ( ), according to which small- to mid-sized manufacturing enterprises and their industrial carriers will be fully supported. Furthermore, the guidelines and principles for industrial land and relevant local regulations on parks, such as Guidelines for the implementation of Industry land policy 2019 (《產業用地政策實施工作指引（2019年版）》) and the Several Policies and Measures of Shanghai on Accelerating the Construction of Characteristic Industrial Parks and Promoting Industrial Investment《上海市關於加快特色產業園區建設促進產業投資的若干政策措施》 ( ), aim to encourage local governments to guide industrial land use and enhance industrial park management.

Demand for Precise Marketing and Sales

Industry upgrading and advanced manufacturing promotion are identified as function of manufacturing industrial parks. However, direct introduction of small- to mid-sized manufacturing enterprises by local governments may not reap a competitive advantage and show poor performance due to unmatched requirements of local governments and enterprises. Therefore, governments tend to encourage professional industrial park developers and operators to introduce target industrial enterprises precisely and provide professional comprehensive industrial park operational services by using industrial land resources effectively.

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Increase in Costs

Due to the increase in comprehensive costs including land costs, to ensure the high-quality development and prevent low efficiency and waste, local governments tend to foster industries more efficiently with strict policies and prudent land supply. Therefore, the development and operation in high density and agglomeration of industrial parks are more attractive. Guided by the Guidelines for the Implementation of Industry Land Policy 2019 and local regulations, governments mainly aim to encourage high density and industry-oriented use. This factor makes manufacturing industrial park developers and operators with proven track records more recognized and supported by the local governments.

COMPETITIVE LANDSCAPE

Due to strong demand for high-quality manufacturing environment in recent years and governmental preference for using industrial land for industry-oriented parks, the manufacturing industrial park development and operation market is growing fast, resulting in more participants stepping into the market. During the period from 2015 to 2020, the increment of total GFA of manufacturing industrial parks reached approximately 46.7 million sq.m. which represented about 85.0% of that in the period from 2010 to 2020.

Considering industry cluster effects and governmental orientations in manufacturing upgrading and transformation, the Yangtze River Delta Region, the Pearl River Delta Region and the Bohai Economic Rim are expected to still remain as the preferred options for developers and operators serving manufacturing enterprises.

Based on public disclosures and JLL Report, our Group ranked second with a total GFA of approximately 10.5 million sq.m.. The chart below sets forth the top five manufacturing industrial park developers and operators in China in terms of the total GFA of manufacturing industrial parks as of December 31, 2020.

The rank of our Group and competitors by total GFA

Ranking Company Total GFA (sq.m.) Market Share 1 Company A 14,672,471 23.4% 2 Our Group 10,484,756 16.7% 3 Company B 8,929,046 14.2% 4 Company C 2,710,907 4.3% 5 Company D 2,198,000 3.5%

Sources: JLL

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Growth and efficiency also matter in manufacturing industrial park development and operation. According to public disclosures of listed manufacturing industrial park developers and operators, the revenue growth rate of our Group was approximately 133% from 2019 to 2020 and ranked first among these of comparable enterprises. Moreover, according to public disclosures of listed manufacturing industrial park developers and operators, the asset turnover rate (calculated by dividing total income in 2020 by total average assets from December 31, 2019 to December 31, 2020) in 2020 was 0.55 and ranked second among these of comparable enterprises.

BARRIERS TO ENTRY

The vital barriers to entry are marketing and sales, development and comprehensive industrial park operational service capabilities. Furthermore, intensive capital investment and various professional skillsets, such as the capabilities of planning and design and operation expertise on a set of business services, are also required for developers and operators. New players are plagued by the lifted marketing and sales threshold and lack of sustainable land pursuing capabilities. Therefore, participants in the industry which have gained abundant land resources, experiences and market reputation across target regions generally possess competitive advantages over new entrants.

COMPETITIVE ADVANTAGES

Layout of the Nation Market and Rapid Penetration of Core Areas

As of February 28, 2021, our Group had a project portfolio of 70 industrial park projects in 45 cities. The number of cities covered by our Group ranks first among manufacturing industrial park developers and operators by the end of 2020. Based on the total GFA of manufacturing industrial parks, our Group ranked third, second and second, respectively, in the Yangtze River Delta Region, the Pearl River Delta Region and the Bohai Economic Rim by the end of 2020.

Nation-wide Industry Resource Marketing and Sales Capability

Furthermore, our Group develops a strong capability of industry marketing and sales for generating abundant industry resources, such as over 90 marketing and sales centers located in various cities, more than 1,000 specialists in the competitive marketing and sales team as well as O2O marketing and operation information platform, an online to offline productivity platform with over 200,000 enterprise information. The comprehensive marketing and sales system help us secure the success of business promotion.

Integrated Service Capabilities

Our Group contributes to building a comprehensive industrial park operational service platform. The services provided by our Group not only mean to be comprehensive industrial park operational services but also include abundant industry information and data. Our Group accesses business information and understands business demand by utilizing digital management solutions. Based on such solutions, our Group provides basic services, administration and facility management services and value-added supporting services from professional, standardized and detail-oriented dimensions.

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Strong Capability of Project Acquisition and High-quality Land Bank

Industrial land acquisition underlines the importance of industry-oriented. There are high requirements for governments to assign the industrial land-use rights and the capabilities of introducing industrial resources and serving industrial entities are valued. Our Group has gained a total land bank of 6.3 million sq.m. primarily in the Yangtze River Delta Region, the Pearl River Delta Region and the Bohai Economic Rim by February 28, 2020, providing an evidence of high-quality land reserve.

PRICE TREND OF COSTS

Price Trend of Land Cost

Land cost accounts for a significant proportion of costs of developers and operators, and has kept rising in recent years. The table below sets out industrial land cost of the PRC for the years indicated.

Industrial Land Cost of the PRC (2015-2020)

CAGR 2015 2016 2017 2018 2019 2020 2015-2020 Average industrial land sold price (RMB per sq.m.) 359 377 408 411 441 445 4.4%

Source: CREIS

Price Trend of Material Costs

Material costs are also crucial factors for developers and operators. Although these costs represented a decrease in 2020, it is anticipated to rebound in line with the rising prices of global raw materials in the foreseeable future. The table below sets out costs of typical cement and steel of the PRC for the years indicated.

Material costs of China (2015-2019)

CAGR 2015 2016 2017 2018 2019 2020 2015-2020

Cement (RMB per ton)3 373 351 404 471 488 484 5.30% Steel (RMB per ton)4 2,391 2,580 3,931 4,271 4,091 3,921 10.4%

Source: CEIC

3 Cement refers to Portland Cement 42.5 N/R

4 Steel refers to HRB400E 16mm

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