According to the Financial Association (Reporter, Shen Shuhong, Han Li), nearly four months after the first batch of public offering Reits went public, the highly anticipated second batch of public offering REITs has finally been unveiled. Recently, the Shenzhen Stock Exchange and the Shanghai Stock Exchange received three public offering RETIs declarations.
On October 14, China Asset Management declared the China Yuexiu Expressway Closed Infrastructure Securities Investment Fund at the Shenzhen Stock Exchange. On October 13, Guotai Junan Asset Management and CCB Fund also reported Guotai Junan Lingang Dongjiu Intelligent Manufacturing Industrial Park Closed Infrastructure Securities Investment Fund and CCB Zhongguancun Industrial Park Closed Infrastructure Securities Investment Fund on the Shanghai Stock Exchange.
On June 21, the first batch of 9 publicly offered real estate investment trusts (REITs) went public. So far, the overall fund-raising scale has exceeded 30 billion yuan. Although some products have broken in the market, the prices of related REITs are all higher than the first ones. The listing price has increased, and individual REITs have even seen capital speculation recently.
The second batch of three public offering REITs are reported
According to the official website of the Shenzhen Stock Exchange, China Asset Management Co., Ltd. declared China Yuexiu Expressway Closed Infrastructure Securities Investment Fund on October 14. This is also the only expressway REITs declared in the current period.
Public information shows that the main original stakeholder (initiator) of Huaxia Yuexiu Expressway REITs is Yuexiu (China) Transportation Infrastructure Investment Co., Ltd., the fund manager is China Asset Management, and the ABS manager is CITIC Securities. The underlying asset is the Hanxiao Expressway. The project is located in Wuhan, Hubei. It is an important part of the Fuyin Expressway (G70). It also connects the Beijing-Hong Kong-Macao Expressway (G4) and the Shanghai-Chengdu Expressway (G42). It is a radioactive channel to the northwest of Wuhan and adjacent to Wuhan. Tianhe International Airport.
Industry analysts said that as an important infrastructure, toll roads are a high-quality choice for the underlying assets of public REITs due to their relatively stable income characteristics. From the perspective of management experience, China Asset Management established a dedicated REITs team in 2015, which later developed into an infrastructure and real estate investment department. Currently, it has staffed a number of personnel with infrastructure project operation or infrastructure project investment management experience.
In addition to this product, on October 13, Guotai Junan Asset Management and CCB Fund also reported Guotai Junan Lingang Dongjiu Intelligent Manufacturing Industrial Park Closed Infrastructure Securities Investment Fund and CCB Zhongguancun Industrial Park Closed Infrastructure Securities Investment on the Shanghai Stock Exchange. fund.
The original stakeholders of these two products have a background of state-owned assets, and the special managers are planned to be responsible for Shanghai Guotai Junan Securities Asset Management Co., Ltd. and CCB Capital Management Co., Ltd. respectively.
According to requirements, each fund share of a public fund has the same legal rights and interests. Among them, the original equity holders or related parties under the same control shall not hold less than 20% of the total offering shares of the public offering fund. At the same time, the public offering fund invests more than 80% of the fund’s assets in infrastructure asset-backed securities and holds them Full share.
Under the above conditions, the infrastructure asset-backed securities can hold 100% of the equity of the project company after completing the delivery of the equity of the project company with the original equity holder. After that, the project company will hold the full ownership or operating rights of the infrastructure project. By operating the infrastructure project, the project company can obtain a stable cash flow.
An industry analyst said that the pilot infrastructure public offering REITs is a major reform and innovation in China’s capital market and infrastructure sector, opening up new channels for ordinary investors to invest in infrastructure, and providing infrastructure companies with traditional equity and debt. In the long run, publicly offered REITs are expected to realize the effective connection of trillion-level stock infrastructure with savings funds and social capital, further enhancing the role of the capital market in serving the real economy, while optimizing the economic structure and promoting China’s economic growth. Quality is sustainable.
“The efficient operation and management of public REITs depends on the continuous improvement of the governance mechanism. In the future, we can further explore the industry-finance integration mechanism, increase the enthusiasm of industrial enterprises to participate, research and explore the training of professional REITs managers, and promote the efficient operation of REITs products.” Shenzhen Stock Exchange Party Committee Member, Deputy General Manager Li Hui revealed at the Beijing 2021 Infrastructure REITs Industry Development Conference held on October 15.
Li Hui also stated that, under the guidance of the China Securities Regulatory Commission, the Shenzhen Stock Exchange is actively studying and formulating supporting rules for fundraising expansion, injecting inexhaustible impetus into the continuous development of REITs.
The first batch of publicly offered REITs showed divergent growth
On June 21 this year, the first batch of 9 publicly offered REITs were officially listed for trading and managed in a closed manner. These 9 publicly offered REITs were sought after by the market as soon as they went public. On the first day of listing, the REIT of the China Merchants Shekou Industrial Park of Bosera led the increase with a 14.72% increase; the AVIC Shougang Bio-Green Energy REIT followed, with an increase of 9.95% throughout the day. From the perspective of total turnover, the total turnover of 9 publicly offered REITs throughout the day reached 1.86 billion yuan.
In the subsequent operations, the first batch of public offering REITs suffered a break. However, in the recent public offering of REITs, there has been an uproar. Taking the AVIC Shougang Bio-Green Energy REIT as an example, after September 13, there has been an increase for 7 consecutive trading days, and the increase in multiple trading days has exceeded 3%. 18.55 yuan. However, in the two trading days on September 27 and 28, they fell 4.89% and 5.40% respectively.
The same situation occurred in the rich country’s first water REIT. Its on-site price once reached 4.827 yuan, but suffered a sharp drop on September 27 and September 28, with a decline of 4.93% and 3.99% in the two days, respectively. After encountering an uproar, the 9 publicly offered REITs were temporarily able to run smoothly.
In general, as of October 15, in the past four months of operation, the on-site prices of these 9 publicly offered REITs have all increased compared with the initial listing prices.
However, the gains of the first 9 publicly offered REITs have diverged. The largest increase was AVIC Shougang Green Energy REIT, which was 24.6%, followed by Wells Fargo’s first water REIT, which had a 19.16% increase. These two products were far ahead of other products.
Zheshang Shanghai-Hangzhou-Ningbo REITs, Bosera Shekou Industrial Park REIT and Zhongjin Prologis REIT all increased by more than 10%, respectively 12.41%, 11.73% and 10.21%. In addition, the red soil Yantian Port REIT and Huaan Zhangjiang Everbright REIT increased by 8.96% and 7.19%, respectively. Soochow Suyuan Industrial REIT and Ping An Guangzhou Guanghe REIT are temporarily at the bottom of the increase, of which Ping An Guangzhou Guanghe REIT is only 0.24%.
It is worth noting that while investors in public REITs are benefiting, original stakeholders are also benefiting from it. According to the announcement by China Merchants Shekou on the evening of October 13th, the net profit attributable to the parent in the first three quarters is expected to be 6 billion to 6.6 billion yuan, an increase of 174% to 201% year-on-year, corresponding to a basic earnings per share of about 0.64 yuan to 0.72 yuan. The reasons include the successful listing of Shekou Industrial Park REIT, with two industrial park properties in the company’s Wanrong Building and Wanhai Building as the underlying assets, as one of the first batch of infrastructure public offering REITs, generating after-tax income of 1.458 billion yuan.
