The construction agency industry is entering a reshuffling period, and industry insiders expect only 40 companies to survive.

Why Can Only 40 Companies Survive in the Construction Management Market?

After four years of rapid development, the construction management industry is moving towards a mature stage of development.

According to data released by the third-party research organization CRIC, by 2025, the top 10 companies in the construction management market will account for over 70% of the new expansion scale, while the changes in overall capability rankings will show a significant decrease. Overall, the competitive landscape of companies is entering a relatively stable phase. The industry expects that the Matthew effect will further strengthen in 2026.

This does not mean that market competition intensity is weakening. Since 2025, the industry has continued to face challenges such as declining rates and homogenized competition. Additionally, affected by new home market sales, many companies are also facing difficulties in collections.

Liu Shui, Director of Enterprise Research at the China Index Academy, believes that in the face of fierce industry competition in the future, construction management companies need to coordinate and integrate resources across the entire industry chain, relying on their own industry chain to efficiently mobilize resources from design to sales, operation management, etc., to provide integrated solutions of “Construction Management +.”

No More Than 40 Companies Can “Remain”

The construction management market is still expanding. According to monitoring by CRIC, by 2025, the new expansion area of the construction management market will reach 245 million square meters, a year-on-year increase of 14%, with the growth rate increasing by 1 percentage point compared to 2024, setting a historical high in overall scale.

Looking closely at the new expansion area of various companies, it can be seen that such growth is not universally present. The aforementioned organization’s data shows that in 2025, the concentration of the top ten companies in new expansion scale will reach 77%, an increase of 6 percentage points compared to 2024; the top five companies alone will account for 45% of the new expansion area.

In fact, the changes in the comprehensive capability rankings of construction management companies over the past two years have been narrowing. According to the “2025 Top 30 Comprehensive Capabilities of Chinese Real Estate Construction Management Companies,” among the top ten companies in comprehensive capabilities, the top five companies in 2025 are almost identical to those in 2024 and 2023, with Greentown Management, Blue City Group, Run Di Management, and Jin Di Management ranking in the top five for three consecutive years. The fluctuation rate of companies ranked 11-20 is also narrowing, with the fluctuation rate in 2025 compared to 2024 being about 30%.

The aforementioned organization pointed out that the narrowing of the fluctuation range in comprehensive capability rankings and the increase in overlap are due to several factors. On one hand, although many real estate companies have entered the construction management business, the number of companies that can truly settle in the market and continue to layout is limited to no more than 40. On the other hand, after more than a year of reshuffling and adjustment, the current “head” and “waist” pattern of the construction management track has entered a relatively stable phase.

It is worth noting that since 2025, the number of companies entering the construction management sector has not increased. CRIC mentioned that from both the perspective of the attractiveness of the scale space and the initiative of the companies, the likelihood of new companies entering the construction management business in the future is low, as the market is approaching saturation. However, in this process, market competition remains fierce, and companies are still striving to seize market share, with one of the key measures being to lower rates. The price war has not ceased in 2025.

Data released by Yi Han Think Tank also shows that from the perspective of profit margins, the management fee rates for commercial construction management continue to be under pressure, with projects charging rates below 2% accounting for 45%, and projects with 2%-3% rates accounting for over 36%, with the two combined accounting for over 80%, putting traditional profit models under severe test.

In such circumstances, even leading companies are also facing profit pressure. Greentown Management recently issued a profit warning indicating that the company expects its net profit attributable to shareholders to decline by about 40% to 50% year-on-year in 2025, “primarily due to intensified competition in the construction management industry, declining project revenues, and the rigidity of personnel costs leading to a decline in gross profit.”

It is also worth mentioning that some personnel from leading construction management companies have revealed to reporters that while the performance of new projects is good, due to the poor sales of new homes, the difficulty of collections in the second half of last year increased, which correspondingly extended the payment terms to suppliers, increasing operational pressure. CRIC pointed out that if the price war continues in the future, the industry will fall into a dilemma of “scale growth and profit decline,” with many small and medium players facing the risk of losses and exit.

Screening of Companies’ Comprehensive Capabilities

The industry has maintained a relatively optimistic expectation regarding the market capacity of the construction management sector. CRIC believes that as local city investment platforms continue to release development demand, the construction of affordable housing enters a peak period, and the demand for stock updates and revitalization of bad assets expands, the market size will continue to grow steadily.

But how can companies break through the predicament and seize market share during the painful adjustment period of the real estate market, when project operation difficulties increase, error tolerance decreases, and the willingness of some potential clients to enter the market diminishes? Different types of companies have different coping strategies.

CRIC believes that for leading construction management companies, the core is to continuously strengthen brand and product advantages, lock in high value-added market projects, maintain a leading scale advantage, while using digital management and integration of industry chain resources to reduce costs and increase efficiency, countering the pressure of rate declines.

In fact, companies have shifted their focus in market competition towards the systematic screening of comprehensive capabilities. A responsible person from Longfor Intelligent Manufacturing found that since 2025, the core demands of clients have shifted from brand endorsement and management output to value realization that is comprehensive and quantifiable, namely whether it can effectively help projects achieve sales, control costs, ensure delivery, and mitigate risks.

Product strength is considered one of the core pillars for realizing value realization. In the current bottoming out of the real estate market, accurately matching market demand with “good houses” is key to driving the market.

A market leader from a construction management company in East China pointed out that this requires companies to become customized service experts, implementing different strategies tailored to different regional markets, projects, and clients based on their respective characteristics, providing various types of “good houses.”

For example, major cities have higher requirements for open spaces. According to research from the Boss Electrical Appliances Innovation Research Institute, the overall proportion of open kitchens in first-tier cities reaches 56.4%, and in units larger than 160 square meters, it reaches 70%. In the southwestern region, local customs often involve large family gatherings, so corresponding products are designed with larger and more open living rooms to accommodate more people sitting together.

According to monitoring by the China Index Academy, in 2025, many construction management companies upgraded their products to create the region’s first characteristic projects, such as the fourth-generation housing, seizing market gaps and forming a “first project effect.” In the absence of competitive products, even in lower-tier cities, they have significant advantages in pricing strategies, enabling rapid sales. For example, in Pucheng County, Fujian Province, Jianfa Update Construction managed the region’s first fourth-generation housing project compliant with the “good house” policy, achieving a sale of 70 units in the first month of opening, ranking first in northern Fujian.

Moreover, mature cost control capabilities help projects avoid overspending risks from the outset, and ensure project profitability in a context of narrowing rate spaces. According to the aforementioned responsible person from Longfor Intelligent Manufacturing, relying on Longfor Group’s long-term accumulated supply chain system and centralized purchasing advantages, combined with self-developed digital tools, Longfor Intelligent Manufacturing can achieve comprehensive cost planning and risk locking during the project initiation phase, and dynamically monitor and provide early warnings during implementation. “A certain project in Zhejiang received client incentives exceeding 10 million yuan due to outstanding cost control.”

For mid-tier companies, Liu Shui believes that their core to break through lies in avoiding direct competition with leading companies in terms of brand and scale, constructing a breakthrough through “regional deep cultivation and differentiated niche segments,” utilizing local networking resources, understanding policies, and leveraging supply chain cost advantages, while undertaking projects from city investment and small and medium real estate companies that leading companies are unwilling to serve or find difficult to manage finely in third and fourth-tier cities. At the same time, they should expand into niche segments such as commercial complexes, directing limited resources towards honing specific professional capabilities.

The aforementioned market leader from a construction management company in East China believes that in an environment where both the market and clients are uncertain, the familiarity of construction management companies with the cities they operate in, their understanding of the market and clients, their professional operational capabilities, problem-solving abilities, product strength, and service capabilities are the most solid foundation amid uncertainties when undertaking projects.

(This article comes from Yicai)