In the first week of October,the China Securities REITs All-Return Index made a modest recovery,indicating a slight upward trend amid overall market fluctuations.As public REITs (Real Estate Investment Trusts) continue to see a surge in new product issuance,two notable examples emerged: the CICC Lian Dong Technology Innovation Industrial Park REIT and the Huaxia Nanjing Traffic Expressway REIT,both of which ended their public offerings ahead of schedule due to overwhelming demand.

This surge happens as the A-share market experiences significant volatility.However,the secondary market performance for public REITs remains relatively steady.Data from Wind shows an overall gain of 0.25% for the China Securities REITs All-Return Index over the week,suggesting a path that started strong but ultimately faced downhill pressure.Among the 45 REITs that are currently listed,many saw declines,with only 14 entities reporting various degrees of weekly gains—amounting to less than 40% of the total.

Leading the charge was the CICC Anhui Transportation Control REIT,which noted an impressive increase of 2.92%.Other notable performers included the CICC Zhongguancun REIT,CICC Shandong Expressway REIT,and the Huaan Zhangjiang Industrial Park REIT,each posting gains of over 2%.Several others,such as the Huaxia China Communications Construction REIT,Bosera Tianjin Development REIT,and Huatai Jiangsu Transportation Control REIT,also exceeded 1% in investment growth this week.

On the opposite end of the spectrum,seven REITs experienced declines exceeding 2%,with four of those dropping more than 3%; one even faced a nearly 3.5% decline,prominently among affordable housing options.This pattern gives insight into the current struggle many sectors within the market are experiencing as they adjust to external economic pressures.

According to Debon Asset Management,recent national stimulus policies are anticipated to progressively influence the molecular side of REITs.Additionally,the domestic market is presently within a clear interest rate reduction cycle that is expected to last for a significant duration—this presents favorable conditions for enhancing the valuation of REITs assets on the denominator side.If there is a shift in risk appetite within the A-share market,we might observe a rotation within REITs from conservative sectors towards those with more growth potential and resilience.

Furthermore,the ongoing trend of ahead-of-schedule fundraising for public REITs continues to demonstrate robust market activity.On October 10,both the CICC Lian Dong Technology Innovation Industrial Park REIT and the Huaxia Nanjing Traffic Expressway REIT officially announced the premature conclusion of their fundraising campaigns.

In an announcement by CICC,it was stated that the original public offering period for the CICC Lian Dong Technology Innovation Industrial Park REIT was scheduled from October 8 to October 11.However,due to high levels of subscription from public investors,the total subscriptions exceeded the total quantity available by October 10,leading the firm to stop accepting public investment applications starting October 11.According to relevant agreements,all valid subscription requests from public investors were confirmed on the basis of 'pro-rata distribution throughout the entire funding process.'

This REIT sought to raise capital through the issuance of 500 million units at a price of 3.234 yuan per unit,anticipating total fund-raising to reach 1.617 billion yuan.The underlying assets for this REIT include three new standard industrial park factory buildings located in Beijing’s Daxing,Shunyi,and Fangshan districts,totaling a constructed area of nearly 198,400 square meters.Notably,these properties are situated within the Zhongguancun National Independent Innovation Demonstration Zone,catering to small-to-medium-sized manufacturing and technology-driven enterprises in strategically emerging sectors.

Similarly,the Huaxia Nanjing Traffic Expressway REIT was intended for public sales between October 9 and October 14,with an offering price of 5.452 yuan per share and a total fundraising goal of 2.726 billion yuan,including 37.8 million shares available for the public offering.By October 10,public subscriptions had already surpassed initial upper limits,prompting the decision to conclude public investor recruitment early,also employing the ‘pro-rata distribution’ policy for valid subscription applications.This particular REIT comprises the southeast section of the Nanjing Outer Ring Expressway,managed by the Nanjing Highway Group.It spans 41.215 kilometers and is part of the national G25 expressway network,benefiting from its strategic proximity to the Nanjing Lukou International Airport.Since its commissioning,the route has demonstrated a positive operational performance,with both traffic volume and toll revenue showing annual growth trends,including a remarkable 26.88% year-on-year increase in 2023.

Additionally,new developments have emerged in the application for new public REITs.The CICC Yizhuang Industrial Park REIT,Guotai Junan Jinan Energy Heating REIT,and Huaan Waigaotai Warehousing Logistics REIT have all received feedback from the Shanghai Stock Exchange on dates ranging from October 11 to October 8 and as early as September 26,2023.These developments are indicative of a steadily evolving landscape in the REIT sector as various entities vie for a foothold amid shifting market dynamics.