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HONG KONG SAR –\u00a0Media OutReach<\/a>\u00a0– 15 June
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As at the end of 2020, there were 185 REITs
\u00a0<\/b><\/p>\n The real estate securitization market in mainland China continues to
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This report
The 2020 Asia REITs Research Report<\/i>
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Cushman & Wakefield
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As one of the professional firms earliest engaged
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Public offering infrastructure
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Recently, nine public offered infrastructure
Hong
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The
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Mr. Andrew Chan, Cushman & Wakefield’s Managing
\n2021 – <\/b>Cushman & Wakefield<\/a>, a leading global
\nreal estate services firm, released the 2020 Asia REIT Market Report<\/i> today
\nat the 9th<\/sup> China Real Estate Finance Forum, in conjunction with the
\nChina Real Estate Association (CREA). The report presents a REITs market overview
\nfor major Asia countries and regions, together with an analysis of properties
\nin mainland China, and the market for securitization of real estate assets in
\nChina. For the first time, the report also includes a special study of the
\ninfrastructure REITs markets in the U.S., Singapore and India; and offers a
\ndetailed case analysis of Mapletree Logistics Trust \u2013 thus providing a reference
\nfor China to draw on in its ongoing development of a public offering-based
\nREITs market.<\/p>\n
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\nREITs in Japan, Singapore, Hong Kong SAR and
\nIndia are the focus of the Asia market<\/b><\/p>\n
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\nin the Asia market with a total market value of US$281.4 billion, down around
\n5% year-on-year. Regulators and REITs managers actively responded to the impact
\nof the COVID-19 pandemic via a range of measures, providing multi-level supporting
\ninitiatives for REITs to maintain resilience in the wake of the pandemic.<\/p>\n
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\nUS$139.4 billion. Although the market value contracted by 9% compared with
\n2019, Japan still accounted for more than half of the Asia REITs market, making
\nit the largest REITs market in Asia and the second largest globally.<\/li>\n
\npolicies, consolidation and merger activities were prevalent and transaction
\nliquidity improved. By the end of 2020, there were 42 REITs in Singapore, with a
\ntotal market value of around US$81.4 billion and a dividend yield of 6.4%.The REITs market in Hong Kong SAR faced
\nchallenges and also embraced reforms in 2020. Total REITs’ stock prices dropped
\nby 11% overall, depressed both by the impact of COVID-19 and an environment of
\nlingering social unrest. The average dividend yield was 6.3%; the average gearing
\nratio was 28% which is lower than those in Singapore and Japan.<\/li>\n
\nREITs issued in 2020 and early 2021, along with two infrastructure INVITs,
\nnamely, IRB and Indigrid, engaging in roads and power networks, respectively.<\/li>\n<\/ul>\n
\nexpand rapidly<\/b><\/p>\n
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\nfocuses on an analysis of changes and highlights in REITs, CMBS and CMBN
\nproducts in the mainland China market in 2020, and summarizes the disposal of products
\nthat expired prior to the end of 2020:<\/p>\n
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\nand 13.1% respectively over the previous year in terms of number and value.<\/li>\n
\nmodel for the financing model in domestic infrastructure industry.<\/li>\n
\nR&F Guangzhou International Airport – Integrated Logistics Park CMBS, and
\nBeijing Huayuan Yingdu commercial REITs, attracted extensive attention from the
\nindustry.<\/li>\n<\/ul>\n
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\nalso robustly analyzes the market performance of infrastructure REITs listed in
\nthe U.S., Singapore and India. Chris Yang, Director, Valuation & Advisory
\nServices, Beijing and Leader of Asset Securitization
\nBusiness Line at Cushman & Wakefield<\/b>, said: “The 2020 report
\nanalyzes the infrastructure REITs in detail, including AMT and Corenergy in the
\nU.S., Hutchison Port Trust in Singapore, and IRB Invit in India, aiming to
\nexplore the development of overseas infrastructure REITs and present a more usable
\noutlook and forecast for China’s public offering-based REITs”<\/p>\n
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\nhas been involved in over 100 real estate securitization projects<\/b><\/p>\n
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\nin the practice and research of REITs in China, Cushman & Wakefield has been
\nactively participating in the development of China’s real estate
\nsecuritization. By May 2021, it had completed due diligence and valuation work
\nfor 113 issued REITs, CMBS and CMBN projects, with a combined value exceeding RMB270
\nbillion. Representative projects include Cainiao Network Logistics, the first
\nexpandable REIT in China; \u00a0Poly multifamily,
\nChina’s first shelf offering renting house REIT; Shenzhen Anju Group’s Talent
\nApartment, the first talent apartment REIT in China; and Suning Yunxin, the
\nfirst REIT allowed for subsequent issuance in China. <\/p>\n
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\nREITs to arrive in the China market soon<\/b><\/p>\n
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\nREITs products gained official registration permission from the China
\nSecurities Regulatory Commission and have entered the sale stage. This
\ndevelopment was one of the focus of discussion among participants at the China
\nReal Estate Finance Forum. Feng Hu, Senior Director, Head of \u00a0Valuation & Advisory Services, North
\nChina, Cushman & Wakefield<\/b>, said, “As the nine public offered infrastructure
\nREITs pilot projects entered the sale stage, the long-expected REITs market in
\nChina finally drew back the curtain. Cushman & Wakefield was excited to be involved
\nin the due diligence and valuation\u00a0 work of
\nfive of these projects. The underlying assets include logistics warehousing,
\nindustrial parks, waste disposal and power generation facilities. Cushman &
\nWakefield supports the sustainable and healthy growth of the public offered infrastructure
\nREITs with its experience and professional services.
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\nKong REITs Market<\/b>
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\nHong Kong, to enhance the competitiveness of the city’s REITs market and
\npromote its long-term development, while safeguarding the interests of
\ninvestors, the SFC announced and implemented a revised Code on Real Estate
\nInvestment Trusts (REITs) in December last year. <\/p>\n
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\nproposed amendments include: <\/p>\n
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\nallowing REITs to make minority-interest investments
\nin properties (Minority-owned Properties) subject to various conditions; <\/p>\n
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\nallowing REITs to make investments in property
\ndevelopment projects in excess of the existing limit of 10% of gross asset
\nvalue (GAV) subject to unitholders’ approval and other conditions; <\/p>\n
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\nincreasing the borrowing limit for REITs from
\n45% to 50% of GAV; <\/p>\n
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\nbroadly aligning the requirements for REITs’
\nconnected party transactions and notifiable transactions with the requirements
\nfor listed companies, in line with existing policy and practices.<\/p>\n
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\nChief Executive has also stated in the latest policy address that the
\ngovernment would strive to promote Real Estate Investment Trust (REITs) in Hong
\nKong to develop Hong Kong into a vibrant REIT market in Asia. LINK REIT (00823)
\nas the largest REIT in Asia in terms of market capitalization, has actively
\ndeveloped into a global real estate investment and management institution
\nthrough the acquisition of multiple domestic and overseas properties and the
\nright of ownership in recent years. The company has assets spread in Hong Kong,
\nBeijing, Shanghai, Guangzhou, Shenzhen, London and Sydney. It plans to explore
\nbusiness growth opportunities in various markets continuously. <\/p>\n
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\ncouple of REITs are launched by reputable companies lately in the Hong Kong’s
\nREITs market, including China Merchants Commercial REIT (01503) and SF REIT
\n(02191), which were listed in December 2019 and May 2021 respectively. Other
\nREITs are also reported to be preparing for listing in the market. <\/p>\n
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\nDirector, Valuation and Advisory Services, Greater China<\/b>, commented, “REITs
\nare an important asset class in the capital market. With the implementation of
\nthe newly revised Code on Real Estate Investment Trusts (REITs), the amendments
\nwill allow Hong Kong REITs with greater investment flexibility. Coupled with
\nthe listing of China’s Infrastructure REITs, we believe that there will be more
\npositive and comprehensive development in the Hong Kong and China’s REITs
\nmarket. <\/p>\n
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