The optimal utilization of stock land is an important path within the context of the New Normal. Some local governments took the lead to establish the urban renewal policy of "positive nonintervention, full marketization" and corresponding benefi t distribution mechanism through institutional innovation. However, due to the longitudinal bilateral monopoly and horizontal fragmentation property during property transaction in urban renewal, market failure emerged consequently resulted by high transaction cost. One-dimensional community governance failed to alleviate the confl ict, while the market could hardly cope with the dilemma of urban renewal with absence of the government neither. Therefore, urban renewal should improve institutional supply in start-up stage, and carries out government interventions through multiple approaches, as well as cultivating the willingness of community participation and innovative community management mode, so as to realize social welfare maximization and equitable sharing.