China REITs Handbook (English)

The official release of trial guidelines for publicly traded infrastructure securities is the culmination of years of deliberating the REIT form in China. With China's economic influence, a listed property trust sector in the country has been a critical part of the puzzle that is missing from the region's real estate markets. While the structure differs from conventional REITs in established markets, it allows REIT-like products to be listed within the current regulations surrounding trust products. It is a significant breakthrough that could pave the way for commercial properties to be held in a conventional REIT structure in the future. With urbanization still in full swing and the pace of GDP growth twice as fast, the overall value of China REITs across all asset classes may eventually exceed the US to become the world's largest REIT market. REITs in China are possibly the region's single biggest opportunity in recent times. Notably, REITs have gained significant traction in the Asia Pacific, with India a very significant recent entrant in 2019 and the Philippines following with its maiden listing this year. The asset class has evolved with a significance that goes beyond that of a listed security in the region. As a vehicle to unlock value and recycle capital, REITs have been a catalyst for sustained urbanization and the continued development of urban cores in emerging markets. Now, by redirecting capital to spur the development of critical infrastructure projects, they are emerging to be a critical tool to revitalize virus-plagued economies. The new rules represent a historic development in the evolution of Chinese capital markets. As the region's premier advocacy body for real estate investment, APREA is proud to mark this significant milestone with the launch of this primer together with Cushman & Wakefield China, King & Wood Mallesons and KPMG. It is an initiative that we embarked on with the full intent of making a critical contribution to the growth of this exciting new asset class in the region's largest economy. We hope you will find the information here of value.