The market for publicly offered Real Estate Investment Trusts (REITs) in China is witnessing a remarkable surge, marked by significant events that have unfolded in the early part of this yearAs of February 10, 2024, the total number of publicly listed REITs has reached an impressive 60, with an initial fundraising total exceeding 160 billion yuan (approximately 23 billion USD). This development highlights a dynamic trend in the financial landscape, characterized by both the debut of new REITs and an expansion of existing projects, which collectively drive the market towards greater maturity and diversification.

Industry insiders attribute the rapid expansion of the public REITs market to the strong interest shown by institutional investors, particularly regarding the dividend attributes these investment vehicles offerThe influx of capital from various sectors has resulted in headwinds of momentum that propel both leading fund companies and smaller firms to strategically position themselves within the burgeoning REITs space for a share in the potential growth dividends.

One standout trend is the simultaneous progress of initial offerings and expansionsAccording to data from Choice, as of early February, there are 60 publicly traded REITs, with a first fundraising scale hitting 164.58 billion yuanVarious sectors have embraced the REITs listing phenomenon, but the toll roads and industrial park types of REITs have dominated in terms of total volume and quantitySpecifically, 13 toll road REITs collectively raised approximately 68.77 billion yuan, accounting for nearly 42% of the market's initial fundraising capacityNotable examples include the CICC Anhui Expressway REIT, which achieved 10.88 billion yuan in its initial offering.

Turning to industrial parks, 16 REITs in this category emerged, totaling nearly 25.93 billion yuan in initial fundraising, spiraling behind the toll road segmentThe consumer infrastructure sector boasts 8 new entries, all of which debuted in the year 2024, raising a collective 21.32 billion yuan

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Other industrial segments like port storage and new energy have also seen meaningful contributions to the initial fundraising landscape.

Policy guidance has further solidified the "initial plus expansion" dual engine framework for REIT developmentRecent months have witnessed progress in various expansion projects, with regulatory authorities providing feedback on applications from leading contributors such as Guotai Junan's Lingang Innovation Industrial Park REIT and Huaxia Fund's Huachao REITNotably, there are currently four expansion projects that have completed issuance, while five others, including Hongtu Innovation Yantian Port REIT, are in the approval process, indicating a robust pipeline for future growth.

Market analysts emphasize that expanding issuance mechanisms serve as an essential pathway for the steady development of the REIT marketThey posit that for fund managers, acquiring new infrastructure assets via expansion not only enhances the scale of managed funds but also improves overall fund performanceThis dynamic ultimately allows for better management of project leverage rates, bolstering competitiveness and investor trust.

The appeal of public REITs has notably drawn keen interest from institutional investors since the beginning of 2024. For instance, the E Fund Huawi Market REIT, launched on January 24, amassed approximately 15.14 billion yuanStrategic investors for this fund encompassed a diverse array of financial professionals, and the offering garnered unprecedented subscription multiples—a staggering 78.72 times for institutional investors and 407.03 times for public subscriptions, setting a new record for consumer infrastructure REITs.

In a similar vein, Guotai Junan's Jinan Energy Heating REIT, which commenced its offer on January 9, aimed to raise 14.96 billion yuan and involved more than 260 professional investment institutions in its allocationThe end result was a record-breaking allocation for both institutional and public investors.

According to representatives from Bosera Fund, interest in public REITs can be attributed to two main factors: their unique risk-return characteristics balance between stocks and bonds, along with the low correlation they maintain with traditional asset classes

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This attribute enables them to diversify investment portfolios effectivelyAdditionally, their relatively high dividend yields become increasingly appealing amid growing scarcity of high-yielding assets, drawing substantial attention from various types of institutional investors.

As of February 10, 2024, statistical analyses revealed that 40 public REITs had distributed dividends 79 times this year, with total dividends amounting to approximately 5.77 billion yuanAmong them, Huaxia Hefei High-Tech REIT distributed dividends on four occasions, totaling 75.56 million yuanThe industry's record for dividend amounts was set by Gongyin Heibei Expressway REIT, which distributed a hefty 666.7 million yuan over multiple intervals, with four other REITs achieving dividends exceeding 300 million yuan each.

The competitive landscape reveals how both larger and smaller fund companies are seizing opportunities within the public REITs sectorBy 2025, the first cohort of public REITs will celebrate its fourth anniversary, and key figures believe this market still holds massive potential for growthNational Securities research estimates that the market size could soar between 2.1 trillion to 4.5 trillion yuanConsequently, there has been an enthusiastic response from fund managers—22 firms have now engaged in public REIT activities, including prominent players like Huaxia Fund, the China Merchants Fund, and E Fund.

Huaxia Fund leads the pack with an impressive portfolio of 13 REIT products, raising a cumulative 35.58 billion yuan across various types, such as industrial parks and consumer infrastructureCICC Fund is also making strides, managing eight REIT products totaling 28.47 billion yuan in initial offerings.

Companies with fewer resources are not standing idly by; some smaller firms like CITIC Jintrust are pushing forward with REIT investments to boost their research and analysis capabilitiesFor instance, CITIC Jintrust's distribution lists have included their proprietary investment accounts, while E Fund Huawi Market REIT attracted significant investments from Yuanyuan Yongfeng Fund during its listing, signifying intense interest across the board.

In conclusion, the public REIT market is rapidly evolving into a formidable entity with immense growth prospects

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