The real estate investment trust fund will open, will commercial real estate REITs make money?

The real estate investment trust fund will open, will commercial real estate REITs make money?
REITs will open in China.Recently, the China Securities Regulatory Commission issued a document to effectively revitalize infrastructure assets, enhance the quality of capital market services to the real economy, and enrich the capital market investment and financing tools. The China Securities Regulatory Commission and the National Development and Reform Commission promoted the trial of real estate investment trust funds (REITs) in infrastructureWork and released a draft for comments.Yan Yuejin, Research Director of the Think Tank Center of E-House Research Institute, said to Sauna and Yewang that the launch of the real estate investment trust fund pilot in the field of infrastructure, from a macroeconomic point of view, reflects the guidance of infrastructure investment in driving fixed asset investment to investAs one of the troikas, the whole is more prominent, and the macroeconomic recovery has been achieved.The introduction of REITs or will promote the development of the infrastructure and real estate industry, the preliminary draft for consultation mainly clarifies the product definition and structure.At the same time, it will enter the realm of mature market experience, use offline inquiry to determine the allocation subscription price, and public investors will participate in the subscription of fund shares at the subscription price determined by inquiry.REITs (Real Estate Investment Trusts) real estate investment trusts were born in the United States in 1960. Their investment targets are real estate, and most REITs are listed on mainstream stock exchanges.It gives the general investor the opportunity to participate in the real estate market with the benefit of biological interest.At present, there are a certain number of REITs-like products in China, but there are many restrictions in terms of investor qualifications, fundraising methods, and listing and trading modes. Most REITs have not achieved public offering and public trading.The China Securities Regulatory Commission indicated that the pilot public offering of REITs will be a truly publicly-raised and listed financial product.Yan Yuejin, Research Director of the Think Tank Center of E-House Research Institute, told Sauna and Yeewang that the trial of real estate investment trust funds in the field of infrastructure fully explained the direction of financial means to help infrastructure development, and also provided a better way for subsequent national infrastructure developmentThe financial environment also contributes to the development of related cities and the construction of real estate.From a macroeconomic point of view, this reflects the orientation of infrastructure development tweezers to drive fixed asset investment, so investment as a part of the troika is more prominent and can achieve macroeconomic recovery.From the perspective of the development of the industrial economy, some specific industrial fields require the cooperation of infrastructure. The subsequent rapid development of the reform of the real estate investment trust and reform of the infrastructure business has driven the development of related industries.From the perspective of the urban economy, a series of reforms in infrastructure construction in some important areas have contributed to the rapid development of the urban economy, and it has also played a positive role in promoting the classification industry within real estate.In this regard, Professor Liu Qiao, Dean of Guanghua School of Management, Peking University, wrote that the real estate investment trust essentially securitizes the mature real estate industry in the capital market; it has both financial and real estate attributes.Through the development of REITs, the stocks of assets and real estate assets formed by infrastructure investment, as well as a large number of incremental parts in the future, can be used as alternative assets to become a market-oriented resource allocation system.Through reasonable evaluation, pricing, issuance, and secondary market transactions, price discovery can be achieved.The price discovery function of the capital market has been tapped, and the market integrates infrastructure assets or real estate for relatively accurate pricing, thereby guiding the effective allocation of resources.From this perspective, REITs are one of the most important starting points for China’s financial supply-side reform in the future.With an annual potential wealth effect of 3 trillion, is commercial real estate fat?According to Lianjia Research, China’s commercial real estate stock has reached about 50 trillion, equivalent to about 20% of the residential stock, making China the world’s only commercial real estate market after the United States.The advance and GDP growth rate (6%) will result in a 6% rental growth. According to the logic of “rent-pricing” of commercial real estate, the potential wealth effect is as high as 3 trillion yuan per year (accounting for the current annual residential budget(About 20%) Once the above growth is capitalized, commercial real estate will become an important engine for China ‘s economic growth, greatly reducing its dependence on residential development.According to the securitization level of more than 30% in the United States, Chinese commercial real estate can generate more than 15 trillion of investable securities.Dong Fan, director of the Real Estate Research Center of Beijing Normal University, told Sauna.com that according to the pilot notice, this pilot area does not include commercial real estate.However, from the perspective of China’s current economic prospects, it may not be ideal to rely solely on infrastructure construction to drive market recovery, stabilize economic growth, and increase employment opportunities.Since the types of construction materials used in the construction of infrastructure such as railways, highways, dams, and railways are relatively relative and relatively primary, the industrial chain is also acceptable. The multiplier effect of this type of investment is very limited.However, commercial real estate is different. There are nearly ten thousand kinds of large-sized and small-scale building materials used in its development and construction, and the investment stimulating effect is strong.Therefore, the restoration of commercial real estate development, holding, operation, capital recovery and other levels of recovery and the improvement of operational quality are of great significance to the current “six stability” and “six guarantees”.Moreover, the creation of REITs originated from commercial real estate investment.REITs require the security, comprehensiveness, and sustainability of packaged assets, and commercial real estate is also more prominent than infrastructure and of higher quality.Sauna, Ye Wang Zhang Yanbian editor Wang Jinyu proofreading Liu Baoqing