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Shanghai bourse has accepted eight commercial REITs applications in one month of pilot 2026-02-04
The Shanghai Stock Exchange has accepted applications for eight commercial real estate investment trusts since Chinese regulators launched a new commercial REIT pilot program a month ago.The eight commercial REITs have underlying assets covering various commercial property projects, such as hotels, office buildings with supporting commercial facilities, outlet malls, and shopping centers, the SSE recently announced.
The original holders of the above projects are well-known property developers, such as Poly Developments and Holdings Group, Shanghai Land Group, Lujiazui Properties, and CapitaLand Investment.
The eight commercial REITs plan to raise CNY1.7 billion to CNY7.5 billion (USD245.1 million to USD1.1 billion) each, for a total of CNY31.5 billion (USD4.5 billion), according to estimates from Bank of China International.
Commercial REITs are closed-end publicly offered securities investment funds that obtain stable cash flows by holding commercial real estate and distribute returns to fund unit holders. The new pilot program allows the independent issuance of REITs with hotels and office buildings as underlying assets for the first time.
Five of the eight commercial REITs that submitted applications to the SSE include office buildings, hotels, and mixed-use complexes, which are the new asset types allowed for the first time by the pilot, marking a new era of full coverage of commercial real estate properties by public REITs in China, Xie Chen, head of research at Coldwell Banker Richard Ellis Group China, told Yicai.
The underlying asset of Huaxia Yintai, one of the newly accepted commercial REIT projects by the SSE, is the Hefei Yintai Center, a high-end shopping center with a large number of luxury retail stores, an industry insider told Yicai, adding that it was difficult for such assets to be included in REIT products in the past.
With the launch of the commercial REIT pilot program, the range of underlying assets that public REITs can cover has significantly expanded, meaning that more eligible assets, such as shopping centers, office buildings, and hotels, can be revitalized through publicly listed channels, the insider noted.
Commercial REITs offer more exit channels for commercial real estate, allow high-quality commercial assets to be valued based on ‘rent capitalization,’ making their operational capabilities become their core competitiveness, and promote the transformation of the commercial real estate industry and even of the entire property sector to ‘asset management’ from ‘development and sales,’ Ai Zhenqiang, chief researcher at the Mingyuan Real Estate Research Institute, told Yicai.
Public REITs can help real estate developers transform their role from developers to operators and facilitate a shift in their asset structure from ‘heavy’ to ‘light,’ according to a research report by China Real Estate Information Corporation.
The attempt to use consumption infrastructure commercial assets as the underlying assets of public REITs began in 2023, when regulators approved the inclusion of consumption infrastructure in the asset types of the public REITs pilot. The first two projects involved underlying assets of a shopping center owned by China Jinmao in Changsha and a brand supermarket of Wumart Group in Beijing.
Since then, the underlying assets of REITs have mainly been shopping centers, department stores, outlet malls, supermarkets, and open fairs. The new pilot has greatly expanded the categories of underlying assets.
Source: Yicai Global
