Supporting Superior Projects with Better Treatment, the SSE Creates a New Ecology for the REITs Market to Promote the Superior and Limit the Inferior

The SSE continues to promote the construction of key mechanisms for listed REITs, support the high-quality development of all REITs project participants who are honest and trustworthy, and have the willingness and ability to improve mechanism construction in order to spare no effort to improve project operation quality and efficiency, and actively reward investors. The SSE gives positive feedback on transparent, standardized and growing REITs projects to realize the coordinated development of both market investment and financing and promote a virtuous cycle in the entire REITs market.

In terms of China's practice of REITs, enterprises, especially originators, attach great importance to the construction of REITs platforms. It is understood that several REITs projects such as AVIC Jingneng Photovoltaics, JD Storage and China Resources Youchao have set the role of REITs operating officer at the level of originators, which coordinates the promotion and implementation of major issues after REITs listing from the group strategic level and provides a steady stream of resources for the development of REITs platforms.

In addition to the attention at the group level, the industrial party also plays a vital role in operation management. Some projects have established market-oriented incentive and restraint mechanisms that directly link the operation effectiveness of infrastructure projects with team and individual performance to fully stimulate the motivation of the operation management team.

The deep participation of originators and market-oriented incentive and restraint mechanisms not only play an important role in the daily operation of REITs but also contribute to the promotion of REITs fundraising expansions. Since 2024, 6 fundraising expansion announcements have been issued in terms of REITs projects in the SSE, reflecting the characteristics of asset mixing and cross-regional asset portfolio in asset screening.

As an open market securities product, the price discovery mechanism of REITs relies on information disclosure. At present, all parties involved pay more and more attention to the disclosure of REITs information, and an increasing number of originators and operation management agencies focus on communicating with investors.

For related parties such as originators who actively promote the construction of REITs mechanism, the SSE adheres to the philosophy of classified supervision to give support to all REITs participants in comprehensively applying various policies and measures, hence strengthening market demonstration and guidance, ensuring improvement, and creating long-term benefits for investors. In terms of information disclosure, the SSE simplifies the preparation of relevant materials and information disclosure arrangements to improve the pertinence and effectiveness. In terms of investment and financing matchmaking, the SSE market has built a full-chain roadshow service platform, hence enriching the communication methods and channels among all parties.

From Yicai on December 6, 2024

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The above information is provided for reference purposes only and does not constitute investment advice.