By Yan Yan, Zhang Shiguo & Li Yifei, Management World Magazine

Research Report, No.135, 2020 (Total 5879) 2020-6-4

Abstract: By way of public or non-public fund raising and the issuance of beneficiary certificates, Real Estate Investment Trusts (REITs) are held by special investment institutions to manage real estate properties. Rents are distributed to investors proportionally after rental income is obtained. In recent years, REITs have been constantly mentioned in documents issued by government ministries and commissions while domestic private equity REITs have taken initial shape. However, relevant laws and regulations on REITs are not yet in place. This paper notes that public equity REITs will become a large-scale and important financial market in four aspects and takes the world’s first and second largest REITs markets as examples to analyze impacts of the U.S. and Japanese REITs institutions on the development of the market. It proposes some policy options including unifying institutions and top-level design for REITs with investment in different fields, providing tax incentives for REITs, formulating delisting trigger clauses and procedures in case of extreme risks, allowing eligible listed companies of REITs to shift to the REITs block for listing, promoting the listing of infrastructure REITs and prioritizing the public listing of public rental housing REITs.

Keywords: REITs, top-level design, policy options