I also believe the past two months, is a piece of the unforgettable memory to all of us. As Vanke, a urban service solution provider. We are always working on the front line, working with the government to fight against epidemics. To assume the work, and life as quickly as possible. Today, right before we deliver you the Annual Result Presentation of 2019. I would like to help you to work through, how the 130,000 Vanke staff to serve our client during the epidemic season. Currently, Vanke has already served 2,663 residential communities, 130,000 employees. We cover 639 retail, and office properties. We have 962 construction sites, and we have 6,672 sales offices. During the epidemic season, how can we guarantee the safe, and the health of our staff, and our client and our partners? That's a big responsibility to Vanke.
To deal with the all of a sudden epidemics, we have already organized our working committee. Every day we organize emergent meetings. At the same time, our team members, and our head of each company is working 24/7 on duty. Because we have many positions within our team. We need a lot of emergency epidemic materials. That's why we started the work, in order to get all the epidemic materials, to fight against the battle. To provide sufficient materials to our cities, and to our staff, and partners. We always give priorities to the health of our staff, and the client. Also donated RMB 100 million, to Wuhan City to fight against the epidemic. During the epidemic duration, and Vanke property management. Has become a very important guidelines, to support our residential communities.
In order to do our work very well. We published 52 of the principles, and the notes. In order to including the facial masks, the short messages. In order to make sure, the protection work's been done very well. Every day, we have 53,000 people on duty every day. 100% of the registration of car traffic, and human body temperature scan at entrance. We also consume over 100,000 masks per day, and over 6,000 L of the disinfection alcohols. The expenditures expected to increase is by RMB 200 million. That's only for Vanke property management. In order to take care of the home quarantine, we also started to provide the Vanke Property Support. And the homeowners can also use our app. To buy vegetables, and other daily necessities online.
At the same time, we're also working with the government. For the residential community management, to provide the protective measures for the last- mile service. Vanke's property management, and its caring support. Has been highly recognized by our homeowners, and the local government. Many of the homeowners, they voluntarily bring the materials, disinfect, and food to our staff, to thanks for our support. We have 40 residential community owners, who voluntarily bring us the food, and the materials on site in Shenzhen only. Besides the property management, and all of our business lines are working together. To guarantee the health of our staff. For Vanke property, we frequently inspect the epidemic contamination measures, at the projects under construction. Suspended the property sales venue, adopt online contract signing, and offer one-to-one reception.
VX Logistics offered free access, to 59 logistics parks in 27 cities. Across the country, to support the local government. SCPG also offered 50% of the rental reductions, to the retailers in 86 shopping malls, throughout the countries in February. We also supported the retailers for their online sales. Our long-term rental apartment, Port Apartment. Also performed a disinfection, and sterilization works. Offered periodical rental relief, for the certain tenants affected by the epidemic. Our elderly care, and education also carry out the epidemic contamination. Containment measures, especially in Wuhan, the center of this epidemic outbreak. In Wuhan, we served 61 residential projects, 127,000 households related to 300,000 homeowners, 31 shopping malls, office projects, two hotels, four long-term rental apartments. We have 5,300 staff in Wuhan.
We have two residential projects, with over 3,100 households. Just next door, to the South China Seafood Wholesale Market. In face of the epidemic, Vanke 65 property service staff stay on duty. In the face of the threats of the epidemic. Some of our staff have already take their annual leave, and left Wuhan. But in order to safeguard the health care of our homeowners. They even ride the bicycle, even work in steps back to Wuhan. To go back to their duty job. They provide the property service to the local community, and residential straight household. To provide the support, and services. You can see, especially Wei Xu, our GM of the Property Management Team. Also started to provide the office, in those residential communities. At the same time, we also help to provide the service to mobile support.
Our hotels in Wuhan also offered logistic support to the medical team. Reinforcing Wuhan from other provinces, and cities. We provide the disinfection room in order, to provide the service to our staff. They can also use teleconferencing, to talk to their home. In order to safeguard their house. Besides that, we also donated surgical masks, thermal scanning device. And air purifiers to the local government, and major hospitals. As the epidemic's been well controlled, and our work shift is being further shifted. To the work resumption, in order to guarantee the health of our staff. We accelerated the resumption for the work, and production. Currently, we have 81% of the project resumed operation, 74 of the workers report to duty. And we expect that 97% of the work resumption rate, would be same by the end of March.
At the same time, our Vanke Services, and Cushman & Wakefield Vanke Service. Implemented a standardization, of the epidemic containment measures. Ensuring the safety, of the more than 10,000 corporations. We also provided more than 10,000 units of the quarantine room. To support work, and production resumptions of enterprises in certain cities. That's a brief report, on our work in fighting against the epidemic. Now it's time for me, to walk you through the annual result highlights. We divided the annual result highlights into nine parts. First of all, our contract sell amount accounted for RMB 630.84 billion, up by 3.9%. Revenue is RMB 367.89 billion, up by 23.6%. Net profit attributable is RMB 38.87 billion, up by 15.1%. Contract amount of the area sold, but not yet booked is RMB 609.1 billion, up by 40.8%. Our positive operating cash flow for 11 years consecutively.
Our dividends distribution exceed RMB 10 billion, for two consecutive years. In terms of the property service, we achieved a revenue of RMB 12.7 billion, u p by 29.7% on a yearly basis. In terms of the logistics, our total leasable GFA of 10.86 million sq m. And we reached the number two, in terms of the high standard warehousing of the scale. And the scale of the cold storage ranked number one in China. Now I would like to report to you the industry overview. In 2019, we still assume that the house is for living, not for speculation strategy. According to the National Bureau of Statistics of China, we have already promoted the steady development.
You can see that in those key areas. The scale of the commodity housing, is up in Tier One- Tier Two cities. But not in Tier Three and Tier Four cities. According to the National Bureau of Statistics of China. The sales area of the commodity housing in China in 2019 is 1.72 billion sq m. Representing 0.1% YOY decrease, with the sales amount of CNY 15.97 trillion, up by 6.5% YOY. You can see that the quarterly growth rate of the sales area of the commodity housing in China was -0.9%, -2.3%, 2.9%, and 0.1% respectively. You can see at the same time, the area of the commodity housing. Approved for pre-sale increased, by 4.2% YOY. And areas of the commodity housing sold increased by 8.8% YOY.
The digestion cycle of the new housing available for sale. In the above-mentioned cities, was about 9.7 months. Total investment in property development in China, was CNY 13.2 trillion. Increased by 9.9% YOY, and which was 0.4 percentage points higher than in 2018. The area of new housing construction, throughout the country was 2.2 billion sq m. And that increased by 8.5% YOY. Also, we can see that. Which was 8.7 percentage points lower than that of 2018. The supplied land was cooled off in the second half of last year. A lot of more land aborted. Auction happened last year. The land market significantly cooled down. The number of land transaction closed, at reserve price was increased significantly. Average residential, and land premium rate declined 8.6% in the first quarter. GFA average transaction price of residential site increased by 15.3% YOY.
During the reporting period, the financial channels for real estate market. Were under continuous strict supervision. Growth rate of property loans dropped. At the end of 2019, the balance of property loans, with major financial institution nationwide, was up by 14.8% YOY. Now I will give you, some introduction of our financial results. We've realized, a positive cash flow for consecutive 11 years. In terms of our revenue, and net profit in 2019, revenue grew 23.6%.
Net profit margin was 27.3%. If we break down by revenue in 2019. The revenue come from property development occupied 95.9%. Net profit attributable, to equity shareholders is up by 15.1%. While in terms of earnings per share, and fully diluted ROE. In 2019, earnings per share is RMB 3.47, up by 13% compared with last year. Fully diluted ROE is 20.7%, is 1% lower compared with 2018. Cash dividend distribution is CNY 11.81 billion last year. Accumulated dividend distribution amounted to RMB 69.17 billion. That was 2.67x of the equity financing over the years. Net gearing ratio was 33.9%, continue to remain at low level in the industry. Cash and cash equivalents, is about CNY 166.19 billion. Much lower than that of the interest-bearing liabilities, due within one year. We continue to maintain a leading credit rating in the industry.
Financing cost maintained, at a low level in the industry. We see the international rating agencies, Moody's, S&P Global, Fitch, SS&C, CCXI. They've maintained, a good long-term rating for us. For example, CCXI give us a AAA rating, and they give us stable outlook. In terms of financing, last year, the financing cost at low levels. For example, we completed issuance of a RMB 4.5 billion of bonds, designated for rental housing. Under coupon rates was a 3.65% and 3.55% respectively. We also issued SCP and MTN, and we also issued USD bonds. The minimum coupon rate of the issuance of a U.S. MTN is 3.15%. Also, we issued more H shares. The proportion of H shares, to total shares cap percentage increased from 11.91% to 13.96%.
In terms of our interest-bearing liabilities, and in terms of our bank loans. Our financing cost is a LIBOR plus margin, is no higher than 5.88%. In terms of bonds, the financing cost ranges between 2.95%-5.35%. Other borrowings financing cost ranges, between 3.62%-6.16%. Let me introduce some of our interest-bearing liabilities. At the end of the reporting period, interest-bearing liabilities amounted to RMB 257.85 billion. Representing 14.9% of total assets, so quite safe. 63.6% of liabilities will mature in one year, and most of the borrowings are bank loans that accounted for 67.8%. In terms of the international environment, we've diversified our financing channels. And we can see that Renminbi liabilities accounted for 65%. In terms of types, fixed rate types. That was about 30%, more than 30%. In terms of target, bank loans more than 50%.
Other borrowings about 20%, more than 20%. In terms of domestic and overseas, domestic liabilities 73%, and overseas is about 30%. After the financial results introduction, I will introduce more about, our business development situation last year. Vanke position ourself as a city, and town developer, and service, and provider strategy. Our main business, including property development, and property services. We will develop along with customer, and along with cities. What you can see in this chart, in the above. These are the four regions of our property development business, and the bottom part is our non-property development. That includes property services, logistics, long-term rental housing, ski resort, overseas businesses, others. Include education, elderly care, ski, and et cetera. Now about development businesses. The sales amounted of property development reached RMB 630.8 billion, up by 3.9%. And average selling price remained stable.
If we break that down by regions, we can see that the top regions are Shanghai, Northern Region , and Southern Region . Now we have occupied 4% of the market share, in the nationwide commodity housing market. We've ranked among the top three in 40 cities, and in Shenzhen, Hangzhou, Shanghai, Dongguan, Nanning, Xi'an, Wuhan, Shenyang, Chengdu, Hefei, Xuzhou, Changchun, Wenzhou, Dalian, ranked number one. We ranked second in 12 cities including Kunming, Tianjin, Nanjing, Zhengzhou, Jinan, Nantong, Nanning, and Wuxi. We ranked third in seven cities including Beijing, Chongqing, and Foshan. Let's introduce about the booking revenue. In 2019, booked revenue of Vanke up by 20%. Our booked average price has been increased, a little bit as well. Sold but not yet booked area, has been increased, and remains stable.
We can see that the sold, but not booked area resource. Has been up compared with 2018. In terms of products, we also still focused on the demand from average people. Residential more than 80%, commercial about 20%-30%. In the amount of residential, a lot of the more products focused on size is under 144 sq m. Now I will introduce, about the construction's situation. In 2019, we completed new construction floor area. We complete 118% of the plan, at the beginning of the year. The construction finish remained stable. New construction floor area was 42.41 million sq m. That accounting for 118% of the plan, at the beginning of the year. Then at the end of 2019, area under construction amounted. To about 102.56 million sq m, up by 12.43 million sq m, compared with the end of 2018.
Completed floor area amounted, to 13.8 million sq m. Accounting for 98% compared, with the beginning of the year. In terms of new investment, we will stick to in 2019. We acquired 147 new projects, and the total planned GFA was 37.17 million sq m. Planned GFA attributable to the company, is 24.78 million sq m. Total land premium attributable, is about CNY 115.96 billion. With an average price of CNY 6,252 per sq m. In terms of the GFA, 71.5% of the new projects, was located in Tier One, Tier Two city. In terms of equity investment, 79.9% of the projects situated in first, and second cities. You can see on the left chart, you can see the breakdown of regions. In the sequence, they are Central and Western Region. And then Northern Region, Shanghai Region, and Southern Region.
In terms of cities, you can see we have the biggest share in Tier Two cities. In terms of land premium attributable, has slightly increased by last year is. Because that we got more land in Tier One, and Tier Two city last year in 2019. In terms of land acquired, that was stable compared with last year. By the end of reporting period, projects under construction. Has a GFA of 102.56 million, and the GFA projects under planning is about 53.94 million sq m. We participated a lot of in the urban renewal projects. The total GFA that is attributable, is about 4.93 million sq m.
You can see that the GFA, the Shanghai Region of GFA of land bank. Accounted for about 18%, the Southern Region, sorry, and Shanghai accounted for about 22%. Northern Region accounted for about 28%, and Central Western Region accounted for 32% last year. We also stick to the principle of building quality products. In terms of quality products in Shanghai. We have a inner home purchase experience center. We have integrated services experience, includes coffee bar, parenting interaction, floral art, pastry and bakery. Making it the cities alone, that can enhance home purchase experience. As well as service in the surrounding community. We've conducted a project called Pleasant Community. For example, we have programs like Pleasant Home, Illuminating the Way Back Home, and Renewal of Old Home. For that community of more than three years of age.
Now I will introduce more, about Vanke Service last year. What we did in Vanke Service in last year? Last year, Vanke Services have made some experience in terms of office building. We've built a joint venture, with Cushman & Wakefield. We established a leading brand in the greater area, for commercial property management. We've established a model of urban space integration services. And we have expanded that to Wuhan Hanyang New Area, Xiong'an New Area, Guangzhou, Baiyun, and Chengdu Hi-Tech Zone. The revenue reached CNY 12.7 billion, up by 29.7% YOY. Actively, the full income from new added projects, was about CNY 5.41 billion, up by 33% YOY. Among that, residential property services provided a full income of CNY 3.34 billion. And non-residential was CNY 2.02 billion.
At the end of the reporting period, the accumulated contract area. Managed by the Vanke Service, was about 614 million sq m, up by 26%. Also, proportion of progress with high occupancy, and high income. Under Vanke's management increased to 62.7%. Also, we have ranked as top one, in China's Top 100 Comprehensive Property Service Enterprise for 10 consecutive years. Ranked the first place, in the most preferred property service brand, of China's top 500 property developer for six consecutive years. We also was named, the leading future property service enterprise. In China Enterprise headquarter, for three consecutive years. Now I will introduce more about logistics, and warehouses. The group uses VX Logistics Properties as its logistics, and warehousing service platform. After nearly five years of development, we served 850 customers.
Scales of the high standard warehousing, and cold chain is ranking top two, and top one in China. We serve clients as e-commerce, express delivery, manufacturing, catering, and retailing. During the outbreak of the pandemic, the significance of logistics as infrastructure has been further prominent. We win the recognition, from all walks of the society. We say it's going to have a promising future. Especially last year, VX Logistics Property acquired 21 new projects. With the aggregate GFA, of leasable properties of 1.91 million sq m. At the end of the reporting period, VX has already covered 44 cities, and acquired 138 projects. With GFA of leasable projects of more than 10.86 million sq m. Now we have 53 projects, that are in stable operation. Especially last year, the VX Logistics also started new support programs.
Jointly speaking, the size of the issue amount is RMB 573 million. And that has been called, as VX Logistics Properties- E-fund, and Logistics Warehousing Phase One Asset-Backed securities. Especially, at the 2019 PRC Logistics Enterprises Annual Meeting, VX Logistics win the Social Responsibility Contribution Award. And VX Cold Chain Logistics business also awarded, as the Gold Penguin Award. Especially, I'd like to talk about our rental housing. We have additional of 56,000 units commenced operation, and 110,000 units in operation in aggregate. And 81% of those are situated in Tier One cities like Beijing, Shanghai, Guangzhou, and Shenzhen. The average occupancy rate of the projects, in operation for six months, or above was approximately 90%.
In March last year, Vanke successfully launched the CITIC Gold Stone, Shenzhen Longgang Vanke Plaza Asset-Backed Securities. Size is RMB 2,160 million, establishing the impression one commercial investment fund in November last year. CNY 3 billion providing support, for subsequent development. Let's talk about the ski resort business. You can see our Jilin Ski Resort is ranking top, in terms of being named. The best ski resort in China, by the World Ski Awards for the third consecutive years. We, as a company, the Yanqing Winter Olympic Village, the Media Center, and the public ski resort for the 2022 Beijing Winter Olympics.
We also provided elderly care. Our brand influence gradually extended. Vanke Meisha Academy was up two, in Shenzhen private international school by 2018 " List." Last year, we also started to utilize the online intelligence construction site platform. For example, like the Your Home Purchase, My Home Online, Best to Share, Sales Expert, and E house selection. We also started our IT construction. We started to provide, the intelligent product for the invoicing management. We now also have the Intelligent Parking System. Which has already been approved, by the China National Intellectual Property Administration. We are also working with Microsoft, in co-establishing the Vanke Future City Lab. Our 1E Technology has already obtained, the Certificate of National High-Tech Enterprises. For Vanke, we are a company of social responsibility.
In 2019, our total tax payment is CNY 143 billion, equivalent to daily tax payment of CNY 286 million on daily basis. Vanke Services launched a rent plan of 20,000 individuals in advance. Helping to stabilize employment after the outbreak. In Shanghai, Yujin Fang, and Fuzhou Yuntaishan, t hey are already become the city's cultural icons, after the urban renewal projects. We also started to promote green building, and prefabrication technology application. Now the coverage rate of green building was 100%. The green 46.62 million sq m, the total area of the green building amounted for 193 million sq m. There is 86% of the group mainstream projects in construction. At the same time, we also actively fulfill the social responsibility. And we also win the Gold Prize of the Houmei, for its property elevation efforts.
At the same time, see that our botanical core pavilion, a t the International Horticultural Exhibition 2019 Beijing. In a way, we show our respect, and our grief and respect life. Ladies and gentlemen, last but not least. I would like to talk about, our development plan for the new year. Currently, the external environment is highly complicated, and full of uncertainties. In the mid, and the long run. The industry has already entered, into an era of competition among the existing properties. The market has already shifted, from a seller market into a buyer market. Resulting more in intensified competition for customer, and the more companies are under severe challenges. In short run, the outbreak of the coronavirus, is also bring further uncertainties to the company. That's why the company will be challenged by awareness, attitude, ability, and action.
We always believe, this market is full of business. Providing us a lot of opportunities. For example, the city renewal projects, and the property along the railway phase. We also have a great brand, especially during the outbreak. Our Vanke Service has been highly recognized. And our rental housing business, and cold-chain storage are going to have a promising future. We believe, as long as we follow the growing city, and the customer. Focusing on customer need, and create quality products, and service, enterprise city, and housing development. Let's also talk about that. In 2020, we adhered to the customer-oriented cash flow-based approach. To strive with partners, continue to create additional true value, and achieve quality development. We're going to work on product, and service. We're going to striving, to minimize the impact of the out. We take care of the fundamentals.
First of all, we need to weather the pandemic, and strengthen the immunity of the enterprises. Prepare adequately, accelerate the progress the work of the employees' safety in mind. Striving for minimalize, the impact of the outbreak on our operation. Secondly, to consolidate, and improve our fundamentals. And offer quality product, service, and projects, meeting the budget of the needs of the customer. Thirdly, we also need to lean operation to improve efficiency, and effectiveness. Fourthly, we need to manage our expenses with reference to the revenue. And achieve effective management of investments, and maintain our leading credit rating in industry. With the strategy of city, and the town development solution provider. Working with our strategic partners, to go for the digital strategy. To support our business, and development. That's the end of the presentation. Thank you very much.
Now communication stage. Our meeting secretary, please give the notice, to our investors right before the QA starts.
All the investors, please press button one to hold on. And then star button, and number one button to raise your question. Please help to close the video conferencing, to avoid the signal interference. All the investors, please speak to the microphone, and slow. Only two questions for each investor. Please help to finish your question at one try. Thank you. Now, I would like to promise GF. Thank you.
Thanks for Madame Zhu. Thanks for your presentation. I have a question, h ow the pandemic is going to impact the property market? And especially, the impact over the operation for Vanke? What kind of countering measures should you take, in order to take care of the outbreak of pandemic? Thank you.
Thanks for Leda Dung from GF Securities.
You asked the question, the impact of pandemic on the whole industry. Business operation for Vanke, and you also asked about the countermeasures from Vanke side, right? Okay, that's the question.
Okay, thank you.
Thanks for the question. I think I'm going to, along with Mr. Zhu, to answer your question. I'm going to answer the first part of the question. And then I will regarding the impact of, the industry business operation of the company. Yes, for sure, the pandemic truly has some impact over our life, development, and economic development. The trend is still didn't impact, the business development of the whole industry as a whole. We have already started, from the premiere stage. And especially for the past, that the platinum stage is already coming. For the past few years, the people were. Whether the industry is in the platinum industry.
I say here it is, because of the four reasons. The first reason for the existing property, and we have already shifted. From the balance to the polarization, from simple to multiple. And especially, with these cities are going to be developed, so differently in the near future. The epidemic outbreak, means that more resources, will be prioritized to those cities. Who have a very good urban management systems. From simple to complex, means that our consumers. They are young, they have diversified value, and they also have different preference. That's why we have to provide diversified service, and product. To the young customers, to cater their appetite. Especially, for the young people, they are also the mainstream of our staff.
For Vanke, currently, half of our staff, born after 1990. And they are going to inject the diversified influence, and the changes to the corporate culture. We're going to see, more complexity in the near future. And the change of the need of the customer, is being more diversified. Now we have more young people in our team. And then these are all going to lead, to more complexity. I also talk about one dimension to full dimension. Why should I mention that? In the past, we only work on the project, and product design. But now you see that, product design stage is already ended. And now we have, to fully release our full competency.
For example, the epidemic outbreak already tells us logistics management, and property service.
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In the past, we only focused on the micro picture, now we have to focus on more details. The details lead to the very important decision. Especially, you see that after having those new businesses available at Vanke Services. In the past, like logistics, like our office rental services, the Port Apartment. Now our calculating unit is already based upon a few RMB, rather than hundreds of the RMB. You can see that we have to focus on those details, in order to deep mine the value. From stabilization to polarization means, that in the traditional property stage, every company can enjoy the benefits. Now, in the existing property stage, the competition is more intensified. And only the top performers, can compete with each other.
You can say that, there are more intensified competitions, between the players in this market. From simple to complexity means that, we are also going to have. More changes in the management strategy, and measures. At the same time, our management competency should also, be fully adapted in the new range of intensified competition. We have to improve our management skills, especially to change our mindset. Especially, on the intensified competition backdrop. You can see the four trends, and the four changes I mentioned just now. Simply from these four points, and the company as a whole. Means we have to improve, our awareness of the competition. In order to win, in the near future. For Vanke, for the past few years, we did the following things.
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Strategy correction.
Till this moment of the day, our business development, and strategy. Need to work with IT, and the digitalization. Otherwise, it won't be able for us to manage, such a huge size of the business. We need to combine this situation of the pandemic. We need to consider changes on the customer side. At the same time, we need to follow the tide of the digitalization. To see how that can help our business development. We will make more efforts in those two aspects. Second, in terms of.
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Add new vitality. So, we can see in the past one year all those changes. In terms of structure, and personnel. We are doing this for the aim of matching, the structure with our strategy. This is to answer our actions, and respond to the outside environment. At the same time, we need to also respond. To some of the concerns, that may be raised by investors. People say that, when we are making a transition. And property service business, should be introduced a bit more. Actually, we don't mention the word transition or transform too much. We don't think, w e are make transformation. Because we are always stick to the one thing. In this real estate market, we just expand our course. We expand our path, w e didn't running out of our path. We're still in the property markets. Our strategy is clear, and consistent.
We will develop along with cities. These are the main themes, in our development in this property markets. We're expanding our niche market, expanding our segments. Why we mention this is because, we've changed from a golden stage to a silver stage. Changes in this industry happened. When you comment in this industry, there are some changes. Of course, in scale, in speed, but that's not enough. Those indicators are not meaningful enough. Can you tell us the number then? Can you tell us, how you're doing with your business? You may ask like that, but I can say that for our business. From a traditional point of view, is not big in size. Additionally, for property services, the revenue is about CNY 12.7 billion. And that's only occupy, a very small percentage in all the revenue.
In terms of sales, that's even smaller, the percentage is even smaller. Maybe all the analysts, from your point of view. You may think, our property services is big enough. Sometimes I think, for a child who is growing up. We can't just impose too much indicators, t o require him or her to grow. For example, for some boy, he might be naughty. He might not perform in the school, he get criticism in the school by the teacher. But maybe for the next term, he can catch up quickly. You don't know. When a child is growing up, we need to give some more freedom. So that's more beneficial, and helpful for his growth. This is for this new business, like property services. Of course, gaining recognition from others, and also logistic warehouses. That's gain importance in this environment, in this change.
We think, when it's mature enough? By the time, where we think it needs to get disclosed, we will do it. Please be a little bit more patient, give those kids a little bit more freedom to grow. Give them more opportunity. That's our hope. Together with your question, I responded a bit more. Specifically, on the changes or influence on the pandemic. I will give the floor to Mr. Zhu.
Thank you for your question. I will make some addition in specific change. In terms of industry, I think you have a lot of observation. In conclusion, clients can't go out of their home. And the sales office were closed, suspended for operation. And the construction site are empty. The work resumption has been impacted.
In terms of our banking, in terms of our client. We've impacted in terms of our clients, and financial. And operation environment has changed as well. Sales, cash collection, construction, ongoing delivery, cash flow, they're all impacted. I will make some conclusion in terms of sales. In February and March, the sales, that will go down by CNY 51 billion, around that. In terms of construction, and delivery, there is some uncertainty. I think in Q1, there will be delivery for about 10,000 units will be impacted. We will see some stress, in terms of delivery. In terms of a construction site, work resumption. Those have been largely impacted. Right now, 80% of the production or construction has been recovered. And 72% of the work, has gone back to the work post. All those will be impact on our cash flow.
Cash flow inflow will getting impacted, will be less. This is coming from the impact on the sales side. Like I said, CNY 51 billion of sales reduction, due to the impact. In response to the pandemic, we will make more expenditures. Indirectly, the cost of fighting against the pandemic. That's going to be more total. It's going to be more than CNY 500 million. Also, some positive changes, along with the things evolving. First of all, visit from clients, we've seen recovery. Recovery has recovered back, to 50% of that in January. Southern part has been better, than the Northern Region, maybe 60%-70%. In the Southern Region, while in the north region is about 30%, compared with January. In terms of returning to work or work resumption. It's getting well, getting better.
Like I said, 80% of the work resumption has started. In industry overall, that's also been better than before. For Vanke, we're doing better, than before now, too. By the end of this month, we think the work resumption rate could be 90%, as we estimate. That's a reasonable estimate, in terms of contract or other method. Our capability of getting people back, to work has recovered. Also, in terms of strategy, and organizational design. We've also made changes in business strategy. Like we said, clients can't go outside of their home. The sales office has been stopped. We launched more online marketing. In 2016, we've made exploration into that already. Now we fully implement it. For the major projects, about 500, those are being moved on the online sales office.
The 22nd in February, there is a project in Fuzhou. And another project in Taiyuan in 29th of February. For those two new projects, the online sales opening. We think the subscription rate is about 86%, and more than 90% respectively. As we said, every house is different, it's unique, and every situation is different. People will not fully trust online sales. People will still need to see on-site, checking the house, of course. We think online marketing, online sales. A supplement tool is helpful. It's not old tool. Online, and offline is helping each other. Whether offline or online is going, to be the dominant method. That's up to the customer. It's up to their choice. And also, we've strengthened our step of management in terms of cash flow. We've been more granular, in terms of the cash flow management.
All BG, and all Business Units, business group will designate one responsible person. To specifically manage the expenditure, and revenue. That's managed by daily, monthly, weekly. The expenditure needs, to match the revenue. The management will be more granular. The payment will be arranged more granularly. Things just happened for two months. Everything's progressing well. We've made a lot of progress, and improvements. Our requirements is that, the duty requirement needs, to get specific to person, to individual. We will take this chance, to improve our management. To improve our operation, to improve our cash flow management, specifically. Actually, two parts is important. For example, like construction site delivery. There are specific measures, when we see stress of our delivery. We need to communicate with customers. We will need to communicate well with the contractor.
I know, we've lost 40 days of work of construction. We have to get things back to track, and at the same time ensure the quality. Good thing is that in China, domestically, the pandemic is getting better than before. The customers' demands, they're still there. But we will need a bit of time, to release the demand. To see the demand getting released. I know, the time is difficult. This time is difficult. We will finally ride it over. If we are pleasant, we will just focus on cultivate our land. Cultivate our crop, do our business, do our job well. We will center it around our customer. We will be cash flow based, and make our action, and response to the pandemic. Thank you.
Okay. Thank you. Now let's welcome the question from next investor. Please press star, and one if you have questions.
Because we have limited time, and to ensure the quality of the conference. Please speak to the microphone, and speak slowly. And each one will have two questions at most. Thank you for your understanding. Now, let's welcome Shen Chen from Huatai Securities.
Good morning. Now, we've observed, that in these two years. Vanke has made some internal changes, like you said. Some internal structural changes, and also some program related. I know there are a lot of things, I heard from the media. And maybe can you take the chance, to introduce us a little more about the change? We also noticed in 2019, the sales of Vanke has been stable. How can you improve the scale, and the sales by utilizing this structural change?
Thank you for your question. I will repeat your question to see, whether I've been accurately note your question.
You've noticed, the changes in Vanke's internal structure. You see the program, of personnel reshuffle. You also see that, you also caring about whether the growth of.
Vanke's performance can reflect the changes' effect. How can you make the change helpful, for the future business growth, sales growth? Okay, thank you for q uestion.
Thank you very much.
Thanks for the question. Let me answer the question. Where you were talking, about the structural adjustment. I know, that many people pay attention to that. For the past few years, we did a lot of work on that. Currently, our organizational structure is being much more simplified, only three layers. We have a GP, SP, and a GRP, only three layers of the employees. We have less than 2,000 GP. The rest part would be GRP. We only have a very simplified, three-layer organizational structure of the employees. All of our employees, have been called as partners of the enterprise. And we are working together, as partners as a whole.
You can see that, still we need a this program. To help us to do the adjustment. The in, and outflow of our department. And personal exchanges, will be more active than what used to be. We also have to flatten the organizational structure, and we also have a full BG in four different regions. By so doing, what we're trying to do is to make sure in the time. When every company is competing for the overall competency. In the past, we were doing the ground-based battle or ground-based attacking. And now we have to have, a multi-quadrant working together. And working multi-task force working together, by having the land-based force. And the airborne force, as well as the multiple forces working together. And to make sure, we have resources in the major aspect. In order to take care of the market need.
That's why, I can say till the moment of the day. What we did? Is in order to improve our overall competency, and competitiveness. Especially, when we do the organizational structure changes. A key consideration we have is, to make sure the organizational structure can work with the strategy. That's why the organizational structure, what you can see now? Still needs some time for further streamline, and further improvement. I surely believe the strategy is the most important thing, and the best performer has already been dispatched. To the front line, in order to lead our task force. To take care of the market need. There are so many changes, for the past few years. And especially, our ROE is still kept at a high level. And that's the result of our diligence. That is also the result, and a big fruit from our synergy.
I think, if the organizational structure is going to be further streamlined, and improved. We're going to also intensify, our personal changes. To inject more dynamics into our team. I see in the near future, the result will be shown. Please bear with us, for a period of time to see the final result. Thank you very much.
Next, would like to welcome the next investor. Now let's welcome Ken from Citi to raise a question.
Thank you very much. Thanks for the management team. I'm Ken from Citi. I have two questions. The first question is also talk about the sales, and the gross profit margin of 2020. Just now you said, that February, and March is going to lead to a CNY 51 billion sales loss.
You say there are going, to be some rigid demands. That are still going to be there, in the second half of 2020. What's your comment on that? In other words, if we take a look at, the business growth for last year in 2019. Your contracted sales is, about up by 4%. For this year, is this growth going to be negative. In terms of the contracted sales, due to the epidemic reason? This is my first question. How you're going to also comment on the gross profit margin? Last year, if you take a look at the gross profit margin on sales. Is it going to have some downtrend pressure? This is my first question. The second question is, we used to have some holding type of the assets. For example, some loan properties.
Do you have the plan of sell them out of the balance sheet, and what would be your strategy? Thank you.
Thank you very much. Thanks for Ken for also the two questions, from you to see. Whether I hear your question accurately. The first question, you wondered about our sales target in 2020. Whether it's going to be negative growth. Whether we're going to have some downtrend pressure, for the gross profit margin. Your second question, and you wonder. Whether we have the plan to sell, the holding type of assets. Or move it out of the balance sheet. The question, t hank you.
Thank you, t hank Ken. Let me answer the first question. Regarding the impact of epidemic, on our sales target of 2020, and the gross profit margin. You say in February to March, our sales lost CNY 51 billion.
We will try our best, to catch up with it in the next. Especially, the demand will be gradually released within this year. But the pace of the release, still needs to be observed in the market. We will intensify our effort a lot, in order to offset. The impact of the epidemic, to ourselves as a whole. You ask whether there're going, to be any decrease of the sales. Or negative growth of the sales target. I say it's less possible. In terms of the impact, over the gross profit margin, 2019. The gross profit margin was down, by 2% in our industry, property market. Gross margin trend is a general trend in our industry. The trend is already there in the industry. What should we do? Actually, for Vanke, we have two to three countermeasures.
The first one, at any point of the time. You have to treat your customer very well. You have to build a good product, and good services. That the customer is happy to pay for it. That's one point. The second countermeasure is that, we have to improve our lean management. Improve our efficacy, and effectiveness of management. The gross profit margin may down, but we can further improve our management efficacy, and efficiency. And in order to offset, the negative impact from the downtrend of the gross profit margin. I have to say, that as institutional investors. The downtrend of the gross profit margin, doesn't necessarily mean the downtrend of the ROE. Especially for the past few years, the downtrend of the gross profit margin, is the general trend in our industry. We are also taking active measures to take care of that.
That's one of the basic requirements in our daily job. The second one, Ken, you ask about the holding type of assets. Whether Vanke has the plan, of selling its commercial properties. For some of the long-term rental apartments, or move them out of the balance sheet. Well, I have to say for Vanke. The most treasurable asset of our company is our reputation, and our credibility [audio distortion]. We value our reputation, and credibility a lot. For any business we do, it has to be highly relevant. To the urban development needed by the customer. All of our holding type of the assets, are be developed by the two preconditions. You see nowadays, customers have more complex demand, and need. Especially, now we have more customer born the 1990s.
They are young. The second point is that, there are more comprehensive city. And many of the so-called land resources, that are for multiple purposes or multiple functionalities. Rather than for single, more so-called complex properties. That can accommodate different functionalities, at the same time. It also brings us, the multifunctional properties to the market. Holding type assets, in our product pipeline. I say that holding type of the assets, we have to improve our operation. Rather than to sell it, or move it out of the balance sheet. If you can do the holding type of assets very well, you don't need to sell it. You have to build the confidence of the consumer. I think the operational efficiency, and operational excellence is the key, for the holding type of assets. Our holding type of assets, they are at different phases.
The land, where some of them are under construction. And some of them, are waiting for commencement. Some of them, are just open for public trial. While some of them, have already got into the mature stage. They are at different phases, that's why they have different performance. To the difference of the development phases. Jointly speaking for Vanke, we would like to improve the operational excellency. Of those holding type of assets, and plan of moving those holding type of assets, out of the balance sheet. We still want to improve, the operation of the holding type of assets. Personally, we also believe, if time allows. And financing move out of the balance sheet, or keep it on the balance sheet won't be detrimental. Thank you. Ken, I'm not sure, whether I answer your question. Thank you.
Next, our meeting secretary, please help to invite the next investor for question.
Next. Let's welcome Oscar, from OB Capital.
Thank you, management team members. I have two questions. The first question is more statistical. In 2019, according to our annual result, your profit is up by 15%. The dividend per share almost not be changed. Only around 30% has been due, to the payout of the dividends. You can see that Vanke now is a company, that has been attached great importance, by those long-term funds companies. The Vanke is very important to those organizational investors. You say that your payout rate, is fluctuating all the time. My question is that, are you going to fix the payout rate in the near future?
If Vanke is truly believe yourself, to be a company in a stable optimization. With robust operation, I believe a fixed payout rate is very important. To build the confidence of the investors. Everyone can help to be happy, and be confident. My second question, a few years ago, the management team. Talked about diversification, I also see some new business lines. SCPG, the Logistics, VX, and the Vanke Service are all performing very well. I still remember last year, the management team also re-discussed another issue. That is, it's time for us to reconsolidate our fundamentals. I would like to ask the management team. Is it means you believe the property sales, brings more benefits, to the company to stabilize its fundamentals? What would be your strategy? Thank you.
Thank you. Thanks for Oscar for your question.
Let me repeat your question, to see whether I hear your question accurately. The first question is that in 2019, the payout rate is down to some extent. What would be the payout policy in the near future? In order to build the confidence, for those long-term investors. The second question is the diversification, and the consolidation of fundamentals. And you already want us, to state our buy, and strategy. For property sales, and our diversified new business lines. That's the two question. Let me answer your question. After getting listed Vanke, for the past 28 years. The cash payout, dividend payout ratio is about 30%. Last two to three years is about 35%. I think without this pandemic, I think we will keep that around 35%. You know things happen, things change. There are virus attacking us, and that's disrupting our policy, and plans.
We need to increase our cash reserve, so as to give us more strength. To respond to the future challenges or uncertainties. Among all the listed companies in China, for Vanke. The dividend payout ratios, has been the most stable one. We also hope that the pandemic disease, can fade out. And operation can go back, to the right track, original track. And then things can be more predictable for everyone. For this time of dividend payout, we've considered a lot of things for this request. We then fix it around last year's. The dividend per share won't be impacted. This is what I want to share with you. Second about our fundamental, and our strategy of diversification.
Actually, you can see that I said, first question, like what I've said. In the properties market, we've entered into silver market, we have seen four changes. We need to compete, with others in a deeper dimension. The singular businesses cannot win forever. The market has changed, from incremental market from exit competition. In the golden market, development business is very good as well. While in the silver market, if we solely rely on that. It won't work for long. Today, you can see that for Vanke. We will keep our strategy, for balanced diversification. We made deployment five years ago, and all those deployment have now become. Have already generated results, that we can present it to you. What's the relation with our fundamentals? Actually, for all fundamentals, development business, we have four regions. They have their own fundamentals. The fundamental is about the property market.
Property service, they have their own fundamental as well. For example, we have the management of a district, of community, management of office building. These fundamentals different. We will focus on the demands of the tenants. Different business will have different picture, different fundamentals.
In different industry, different sector. We need to take good care of our customer. Provide good services for them, good products for them. That's our fundamental. That does not represent, we are going back to. What we are doing in the golden age, like seek speed singularly. That's my answer. Am I answered your question?
Yes.
Okay, thank you. If Oscar doesn't have any more question. Let's welcome the question, from the next investor. Let's welcome Liu Xiao, from Dongzheng Asset Management.
I have two questions for you. One is that, based on industry development, we have entered the silver stage. Small, and medium companies can find it more difficult. To surpass others as a leading company in the industry. In this changing environment, in this competition environment. In this policy, what are your advantage? Can you play it out fully, for example?
Is your advantage over financing cost, or increase your land investment? Also, my second question is, in thinking about the future three years. What are the strategic target of this business? For example, market share, sales, et cetera. That's my question.
Okay, thank you for your question, Mr. Liu Xiao. Let me repeat your question just to clarify. First, the question is that, you observed that in the industry. Whether as a leader, Vanke has this advantage, for example, investment or new construction, et cetera. Second, in the future three years, what are the strategic target for this business group? For example, market share, sales, et cetera. I will give the floor to Mr. Zhu, to answer your question.
Thank you for your question.
To answer your first question, about the competition landscape. And our advantage, as a leader in the industry. I think, based on observation. We think, companies will not focus too much on scale. For example, just like a customer make a purchase. The only logic or thing is that take good care of a customer, and provide good products, to manage our cash. To the outside world, we think provide good products, good service, and good products. That customer them well, and manage our company well, manage our cash flow well. No matter how big your company, we are doing our own business. As a group, we might encounter different problems related. With different stage of development. For example, for bigger scale, it's hard for them to make a transition, transformation, et cetera. Whether it could fund challenge in terms of innovation.
We are conscious of those challenges, we are keeping our effort strategy. To be quickly responding, to those challenges. Based on our thinking into observation, there are two types of challenges. First of all, customers want individualized treatment or individualized products , and services. M equals one, for a successful company. Every customer is unique. The second is the terms of resources allocation. That means R equals G, whether we are capable to coordinate, and integrate all kinds of resources. In terms, even global resources, coordinate all partners to take good care of our customers. Provide differentiated, individualized service, and products to customers. These are the challenges we're facing, we are keeping to revising our strategy. We are learning from the good practices from peers. From leading companies in the industry.
We are interacting, and exchanging with these exemplary companies. And improving ourselves in different industry. These are the possible challenges, that a big company might encounter, and our way of solving it. In terms of the existing, and new business, like Mr. Yu Liang mentioned. They are centered around property market, real estate market, and centered around customers' needs. And that's centered around, the need of a city's development. For a different segment, different business type, there will be a leader. There will be requirement for that. We will focus not just on the size, but also the influence. For the people inside the Vanke, one request is to build up the capability first. And then we will request on the scale. The scale will respond, to your improvement of capability dynamically. For some business, is it big enough? We will set it apart like independent army.
For example, Vanke Service. In the past, it was listed or affiliated under the four regions. We will, a s long as we put our mind to do something. Then we will make it a leader in the industry. Within a reasonable time horizon, we can't make it to our target. We will put new personnel leader, to lead the team to see how that works out. If that doesn't work again, then maybe we will consider. We tried both, and then the business still didn't work out well. Then we will close it timely, to cut the losses. This is a revision of a strategy dynamically. We will have our tolerance for error. Because the capital is given by you. It's given by investors, so that's my answer. I'm not sure whether, I've answered your question. So, I might add something.
Actually, yes, we are revising strategy. In terms of revision of strategy, that doesn't mean that won't answer the specific question, of the strategic target of each business line. It's not like a strategy deal with numbers. We are saying that we n eed, to be leaders in different segment, different business line. If all business lines can take good care of their customer. Then I believe that, this business is valuable, creates value for other. In terms of how much value it can create? Then I believe, market will offer fair price. Of course, it's hard for us to set a fixed target. Like the value should be this, and that three years ahead. I think the core is to take good care of our customer fundamentally. The revision of our strategy won't be dealing, with numerical targets for businesses.
If revision of strategy, it means revision of numbers. Then that's not a good strategy.
Okay, thank you for your question. Let's welcome the question from next investors. Let's welcome Mr. Zhao from China Merchants Securities.
Can you hear me? Hello?
Hello. Yes, please raise your question.
Good morning, I'm from China Merchants Securities. My question is that observed your financial results. We've seen some numbers, and also mentioned by you that. You're losing weight, you're gaining muscles. I know the industry, has changed in the silver stage. Like people getting ages after 35 years old, then requirements will be different. Last year, we've seen that in the third quarter, you are getting more land aggressively. This year, there's some changes. For example, like the dividend payout, that's gone down a little bit. Is this change reflect your change in strategy?
Does that mean, that all reflects your judgment in the future's market direction? The losing weight has been periodically finished. Will you start gaining more muscle now?
Okay, l et me repeat your question. Please correct me if I'm wrong. You mentioned you observed, that the quarter last year. Vanke has increased the land acquisition, and you also mentioned the changes in the dividend payout ratio. Does this changes in those numbers, means our changes in terms of strategy, and in terms of our judgment assessment of the market development? Have you finished with the losing weight? Will you start gaining muscle now? What you mention in the changes, internal structure? Does that mean a change in gaining muscle? Gaining muscles, right? Yeah, our action in terms of gaining muscle, right? Now I will give the floor to Mr. Zhang Xu for your second question.
Now I will answer your question, in terms of losing weight. And gaining muscle, and injecting new blood. That refers to our changes, in terms of our internal structure. Structure service, strategic goal. The ultimate target is that, it serves the business development. Of course, things are based on the strategy plan as well. We've mentioned this losing weight, gaining muscles. Important principle is to match the right relevant duties. With the right relevant personnel reasonably. First of all, we decide what we need to do. And now that's needed, and then that's appropriate. That's also based on our judgment of our strategic direction. In terms of your other question, I will give the floor to Mr. Zhang Xu.
Thank you for your support, and care. And thank you, for your observation of us.
You've seen, that we've acquired more land third quarter last year. First of all, in the investment, our strategy of investment hasn't changed. It's still centered around development along with city. Along with population, provide services to urban citizens.
No fundamental changes. In terms of the year-over-year investment, although investment last year. We've made a statistic that, 31% of the investment is listed. And about 28% is secondhand land, about 30% is the land from the auction. That means 69% of the land, we acquired from agreement. From all the coordination between primary market, and secondary market. You know these things, will be reflected a few months later. Or maybe one or two years later, if we do it through agreement. We have to follow the case, like years till we get the land. We see the number changes in the Q3. Maybe that's a coincidence. Maybe in that quarter, maybe one specific or two specific piece of land. Has been delivered or been obtained. That's why you see a big size in Q3 last year.
That's a brief clarification from my side. Well, the second part is, that in the next three to five years. Are we going to change our judgment? Well, for Vanke, we believe after the epidemic outbreak. In the mid, and the long term in China. The property market demand, will still be there. The key is how should we serve our customer better? How can we provide a quality product. To serve the customer, to improve our overall competency? If we have a good capacity of serving the customer. Providing the customer, with high quality product. Especially, the housing residential product, I think in the next three to five years. Vanke is still going to have a big opportunity, of competing in this market. That's my answer to the question. You also mentioned, about the payout.
I won't repeat the answer, because the Chair has already given you the answer.
Okay, thank you. Meeting secretary, please help us. To invite the next speaker for question. Due to time reason, we will only be allowed to answer questions for two to three investors. Next investor, please.
Next, let's welcome Deng Xiaofeng from Dacheng Fund.
Thank you very much. Thanks for the management team. I have only one question. After the annual presentation, I saw your rental income, it is up, it is good. I can also say that, your depreciation is still growing very fast. I'd like to ask for your new business, what is the size of the income, its growth? I also would like to know, the general investment plan for those new businesses? Thank you.
Thank you. Thanks for Deng Xiaofeng .
Please allow me to repeat your question. You ask questions about our new business income size, its profit, and its growth momentum. You also want to know, our investment plan for this new business. Yes. If possible, can you please walk us through, each of the new business respectively, and to be more specific? Okay, sure. Let's welcome Mr. Zhu to answer the question, please.
Thank you. Thanks for Deng Xiaofeng for your question. Yes. For our business, right, besides the fundamental business. If you read our financial report, you will see that the fundamental business accounted for 92.5%. And the new business accounted for 4.8%. Many people take care of our business, besides the fundamental business. Just now, the Chairman, Mr. Yu Liang, spent a lot of time sharing this information with all of you.
As you said, it's new business. But actually, it's new for Vanke. But it's no longer new, for many market players. Because those businesses already been verified in the market. Internally, at Vanke, we have a principle. There are 29 working principles inside Vanke. We have to respect the market, and follow the momentum, or change according to the trend. We were never foresight, and speculate the market too much. You see, many of the business still comes from the customer. And from the urban development of one city, to be objectively speaking.
If you are a company, if you are the investor. You truly want, to get some specific number on those new business lines. I welcome you to come to our company, and to have some survey. We also welcome our investors, to come to Vanke. Personally, so that we can provide you more specific numbers, regarding those new business. From the income side, it's less than 5% of the total from investment side. Along with other corporate business, we are taking the prudent. Attitude of making investment in the new business. We also did some arrangement, according to the accounting rules. For example, the new business, we always take the cost accounting principles. The income revenue are also carrying, the feature of the new accounting rules.
If you are really interested in those specific numbers. You can take a look, at the investment properties in the consolidated table. And some of the equity, are also related to those new business. In terms of the investment of those new business. Does Vanke has its own plan, or its target growth? Well, I'd say those new business, have already been verified in the market. It is also growing logically. Well, internally at Vanke. We believe all of the business need, to be verified by the business logic. It can grow from zero to one, so that we can nurture it. From one- 10, and 10- 100 for its future development. You see, for those new business, no matter from the investment, and the size of the business. It failed to meet the requirement, for individual disclosure or independent disclosure.
It's very easy for investors to talk to us, and we welcome you. To come to the company, to get access to more specifics, about those new business lines. I welcome Deng Xiaofeng, from Dacheng Fund to come to Vanke. And to talk to us, so that you can get access, to more specifics. We welcome you, to come to the company.
Okay, t hank you. I have one more statement, sorry. I find out, why we are well-performed in new business lines. It's because we always consolidate the outsider point of view. To help us to consolidate our business. We have a well-consolidated fundamental business, so it's somewhat easier for us. To penetrate into the new business, but we always have our expert outside opinions, to support us.
For Vanke Master Forum, we're going to welcome some industry analysts. To come to our Master Forum, to share with us the industry trend. The future of that one industry, so that everyone can benefit from that. In order to develop, our new business lines. It's more like an invitation to our analysts. I welcome our analysts, and our investors to come to us. To share with us, your opinions on one industry. So that we can develop, our new business better. Thank you. Our meeting secretary, please help to invite the next investor for question.
Let's welcome Chen Cong, from CITIC Securities. Thank you.
I have two questions. The first question, in 2019 last year. Our gross profit margin was down, and the Land VAT is also up aggressively. Can you talk about the backdrop story?
Does the cash flow in 2019 truly grow, compared with 2018? The second question is that for the company, its ROE. Its ROI is somewhat slowed down a little bit? According to the market principle, the GUV, and its business size should be expanded. And its ROI should be improved greatly. Why the ROI of the GUV is still fluctuating, and down a little bit? Is this going to be up in the near future? That's the two questions I have. Thank you.
Thank you, t hanks for Chen Cong. Let me repeat your question. The first question, you said Land VAT is up. What's the reason? The second is because the ROI is down. Why? Okay. Yes, two questions. Now let's welcome Mr. Wang to answer the two questions.
Thank you. Thanks for Chen Cong.
Let me answer the question on the Land VAT up. The next question would be leave, to Ms. Han. Land VAT, yes. In our annual report, Land VAT is up by 2% in the total. It also accounted for 42%. Actually, it's very obvious. Why should it be? Just one reason. Because we have more high-profit project that are taxable. If you take a look at, the gross margin of the taxable items. You can find out 40% of the gross profit. Compared with 2018, in 2019, the number's been doubled. The fundamental reason is, because some projects in the Tier One city, and we acquired the land many years ago. That's why you see our gross profit margin is up, b ut the Land VAT is up. That's the reason we encountered this problem last year.
For Vanke, in terms of the taxation. We are always a legal taxpayer, and we also legally pay all the tax, and recognize the tax done. First of all, we always follow the law, and regulation to consolidate our tax. We never trying to find, some tricky ways of doing that. Otherwise, our profit won't be true, and we will also be identified, and suspected by the regulators. It's going to be a risk for the company. Secondly, we won't build too much VAT, than what is truly happening. Because that's the company's performance. The performance is related to the KPI, our shareholders, and our investors. We always follow the law of building our tax payment. What you can see from the table is the objective, and the true picture of the project operation.
Thank you very much. Thanks for transfer.
You were asking about the ROI. Yes. In this year, in 2019. The ROI compared with last year, CNY 6.3 billion, was down a little bit. It's a normal fluctuation. Our ROI comes from a sum of the projects, we are working with. And its revenues that has not yet been built, into the balance sheet. To follow the prudent attitude, will also help to improve our profit attributable. And is around CNY 2.1 billion. We also disclose this information in the annual presentation. That CNY 2.1 billion is being put back. And you will see that our ROI, would almost be the same as last year. It's a normal fluctuation.
Okay, t hank you. Because time is limited, now let's welcome the last question.
Please press star one, wait if you have any questions. Please, because time is limited, to ensure the quality. Please speak to the microphone, and speak slowly. Each of you will have two questions at most. Please finish your questions at once. Now let's welcome the overseas investors. Let's welcome Li Nan from Abu Dhabi.
Oh, hi. Thank you for the presentation. I just have one question on the land investment. I noticed your planned new construction, start in 2020 represents a substantial. Over 30%, decline compared to last year's. My question is, given Vanke's already low land bank level. Will the company continue, to hold a cautious stance on the land acquisition? Also, it will be helpful if you can share your assessment. On the land market, in the first half of this year overall. In terms of opportunity, and competition. Thank you.
Thank you. Thank you for your question. Let me repeat your question. You've observed our new construction. That's gone down about 30%. Also, you've asked whether, our plan for land acquisition. Whether that would be cautious, and you asked about the opportunities, and our predictions for the land market. Is that true? Is that your question?
Correct.
Now, I will give the floor to Mr. Zhang Xu.
First of all, I would like to say that for Vanke. We will stick to our principle of cautious investment. That has never been changed. Also, you've mentioned, some new construction. That's gone down, by 31% compared with last year. For new constructions, that all construction are arranged, based on the new projects. That's made based, on the year-over-year supply from the market. This year, you've seen that the total GFA under construction is. About 100 million sq m, so I think the supply is enough. I think the new construction, will ensure the sales of this year. And we will make changes, to our construction dynamically. We've been controlling this ratio, controlling our construction planning dynamically. We've been closely watch the land acquisition ratio, and sales ratio.
This is our arrangement, in terms of the new construction. In terms of a land acquisition, we've kept the ratio, land bank. At a reasonable level, and we've kept adequate resources. And that's enough to support the development in the future two years. That's the overall construction, and overall land acquisition strategy. I'm not sure, whether I've answered your questions.
Because time is limited, I think this is going to be the end of today's annual results announcement. Thank you for your support, and care for Vanke. If you have other questions, please send your questions to our mailbox. To ir@vanke, or you can talk with us, on our public account on WeChat.