Casey, I am not quite sure why you mentioned there are no administrative costs. First, the project I talked about is the Williamsburg project, which, according to the press release, is only a parcel of land now. XIN needs to have project managers and hire contractors to complete the condo. Are you implying XIN can magically turn a parcel of land into a luxury condo without any costs?
The project manager and the contractors are baked into the gross profit. Selling expense is baked into ASP and part of GP. SG&A are a reduction of GP under IFRS and GAAP. All costs once you start construction is a project cost, which is part of GP.
SG&A costs are costs that can be associated with other activities than the production of the product. Examples would be the CEO's salary, the accounting department, and depreciation on the home office. XIN did not announce the creation of a new division, which would be the only way SG&A would increase for a company like XIN.
The license on the wall did not come with a magic decoder ring. It is just accounting.
You said the right word Casey, MAGIC. They have no costs, it's all FREE. They didn't really
have SG&A costs of 15M when they had almost nothing in the pipeline. I bet they come back
in this quarter and say, not only did they pay down debt of $54, as only one of their costs,
but they paid off another 100m and still have over 600m free cash. It's a wonderful thing. BTW
after a couple months did you ever find out what Xin paid for (what they called 15 LUXURY apts in Irvine), or were they free too?