Fruitful Results of Four-Year Hard Work: China's REIT Market Value Totals Over 200 Billion Yuan, with SSE Establishing a Main Platform for REIT Market Development

Translated from Xinhua Finance, by Yang Yiren

Since the listing of the first batch publicly traded REITs in 2021, China's REIT market has flourished for four years. As of June 2025, the total issuance scale has exceeded 180 billion yuan and the total market value has exceeded 200 billion yuan, with 66 listed products, ranking first in Asia and surpassing Hong Kong, Singapore, and Japan.

As the core engine of the market, SSE performed particularly well: 44 REITs were listed on the primary market with an issuance scale of approximately 123 billion yuan and the secondary market value reached 137 billion yuan. Since 2025, the average daily transaction value has been about 437 million yuan. Regarding the entire chain from issuance to trading, SSE-listed REITs could account for over 70% of the total market, firmly securing the main platform for China's REIT market development.

Promoting development with an excellent ecosystem and facilitating "desirable returns for outstanding projects" with the market-oriented pricing mechanism

The rapid development of the REIT market is contributed by the development of a benign ecosystem with market-oriented pricing as the core. SSE promotes the market-oriented transformation of the entire chain of issuance pricing, trading, and existence management through institutional innovation and market practice.

The primary market has adopted an inquiry mechanism, with the recently listed BOC Sinotrans Warehousing and Logistics REIT serving as a model. By opening up the market-oriented pricing range, it attracted 575 offline bids, with a full-time multiple of 251.12 times. The final price was 16.16% higher than the appraisal price, setting a market record and highlighting investors' recognition of high-quality assets.

The secondary market has seen the emergence of top projects such as Beijing Government-subsidized Rental Housing and Jingneng Photovoltaic REITs. These projects have achieved stable operations of underlying assets through measures such as setting up "operating officers" for overall management, establishing market-oriented incentive mechanisms, and regularizing investor open days. Data shows that the secondary market price has generally increased by over 20% (up to 90%) compared with the issue price. Since 2025, the turnover rate has been over 1%, significantly higher than the market average.

The market-oriented mechanism allows "outstanding projects" to gain "desirable returns". This not only improves the efficiency of resource allocation but also enables investors to make rational decisions based on asset value, thereby steering the market from "blind investment in new stocks" to "value investment".

Achieving multiple benefits from market value dividends, with continuous enhancement in the sense of gain for all parties

REITs have become the "favorite" of allocation-oriented investors with their high dividends. The 44 SSE-listed REITs have distributed a total of 15.1 billion yuan in dividends over the past four years, with a dividend rate of 5.7% in 2024, including 8.2 billion yuan for highway REITs and over 1 billion yuan for REITs in various fields such as energy, environmental protection, and industrial parks.

Trading-oriented investors also gained a lot. The average ex-rights price of SSE-listed REITs in the secondary market rose by 14%, and sectors such as municipal water conservancy and affordable housing saw growth of over 55%. Diversified asset performance has met the needs of different risk appetites and promoted liquidity improvement. Since 2025, the market value of SSE-listed REITs has increased by more than 20%, outperforming major broad-based index products.

The investor structure is becoming increasingly diversified. Insurance institutions, securities traders' self-operated institutions, private equity funds, and others are actively entering the market. Additionally, innovative products like REIT index funds and ETFs are ready. The incremental funds in the future market are worth anticipating. Currently, there are 21 projects under review or to be sold in the entire market (including follow-on offering), and SSE holds 17 of them, providing continuous impetus for market expansion.

Continuously facilitating market expansion and category increases, driven by the dual engine of "initial public offering and follow-on offering"

SSE covers a full range of REIT asset types, with rich subdivision forms. From the first batch of REITs related to industrial parks and toll roads to the subsequent additions of products for affordable housing, energy, consumption, and data centers, the asset map has been continuously extended, among which REITs related to sewage treatment and municipal heating are unique categories of SSE. The consumption field has covered diversified formats such as department stores and community supermarkets, and the first-floor tenants cover retail, catering, and other fields.

The follow-on offering mechanism has become a key engine for market growth. In 2023, REITs of GLP Pte. Ltd. and Zhangjiang High-Tech Industrial Park achieved successful follow-on offering. Since 2024, 10 projects have been expanded in the whole market, with 6 of them contributed by SSE (4 accepted and 2 approved). The "initial public offering and follow-on offering" model has not only optimized the asset portfolio but also promoted the market to move towards a deeper level and a wider range. In the future, the first REITs in fields like tourist attractions and elderly care facilities are expected to be launched at a faster pace to further enrich the market ecosystem.

Consolidating the foundation for rules and systems while continuing to strengthen market ecosystem development

SSE has established a multi-level rule system of "business methods, guidelines, and guides" to standardize the entire process from review and follow-on offering to information disclosure, providing institutional guarantees for the sound development of the market. Over the past four years, a total of 51 performance briefings have been held and 15 special programs such as "New Vision of REITs" and "REITs Talk" have been recorded to facilitate in-depth communication between investment and financing parties and reinforce the price balance mechanism.

In terms of multi-level market development, pre-REITs, quasi-REITs, and holding-type real estate ABS constitute a complete ecosystem chain. As the designer of holding-type real estate ABS, SSE has implemented 7 projects with a financing scale of 12.2 billion yuan, providing a foundation for fostering underlying assets of publicly traded REITs.

Continuously enriching the asset securitization product map and shaping a promising future for the REIT market

From the start of the first batch of 9 REITs four years ago to today's new stage of expansion and quality improvement, China's REIT market is becoming a crucial tool for revitalizing existing assets and serving the real economy with a background featuring market-oriented transformation, diversification, and standardization. As the main platform, SSE will continue to optimize the ecosystem, foster innovation, and promote REITs to cover more asset categories and fund types to facilitate China's economic transformation and upgrading. With the expansion of underlying assets and enhanced policy support, a new landscape of a more dynamic, efficient, and resilient REIT market is taking shape.

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