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The first batch of REITs expansion projects were listed on the Shanghai and Shenzhen Stock Exchanges

The first batch of REITs expansion projects were listed on the Shanghai and Shenzhen Stock Exchanges

On the occasion of the second anniversary of the listing of the first batch of infrastructure public offering REITs, the implementation of the four single expansion projects has also injected a “stimulant” into the current market. On June 16, the first batch of expansion projects were listed on the Shanghai and Shenzhen Stock Exchanges, which means that the expansion mechanism has been fully implemented. According to industry insiders, this is of great significance for optimizing investment portfolios, enhancing product anti-risk capabilities, and promoting the market to form a two-wheel drive pattern of “IPO + expansion”, which marks that my country’s REITs market has further moved towards the stage of normalized issuance.

  Continuous smooth investment and financing cycle

“The real long-term vitality of public offering REITs lies in whether they can continue to expand and acquire high-quality asset portfolios. By continuously absorbing high-quality asset portfolios, they will continue to make efforts to grow bigger and stronger, and become an organic life that actively manages and makes a difference. The first batch of REITs project expansion The landing will play a positive role in promoting the continuous inclusion of high-quality stock assets in the market to achieve market scale growth, and it is also one of the signs that the market is gradually maturing.” The relevant person in charge of Bosera Fund told reporters.

Specifically, the four single infrastructure REITs expansion projects are Bosera Shekou Industrial Park REIT, Hongtu Innovation Yantian Port REIT, Huaan Zhangjiang REIT and CICC ProLogis REIT, with a total fundraising amount of more than 5 billion yuan. Among them, Bosera Shekou Industrial Park REIT’s acquisition of assets in this expansion is the China Merchants Smart City (Guangming Science and Technology Park) Science and Technology Enterprise Accelerator Phase II project located in Shenzhen Guangming High-tech Park; Hongtu Innovation Yantian Port REIT’s acquisition of assets in this expansion It is the Century Logistics Park project located in the Yantian Port Comprehensive Free Trade Zone in Shenzhen; the assets purchased by Huaan Zhangjiang REIT are the Zhangrun Building project held by Zhang Run Real Estate; the assets purchased by CICC Prologis REIT are GLP Qingdao Qian Wangang International Logistics Park, GLP Jiangmen Heshan Logistics Park and GLP (Chongqing) Urban Distribution Logistics Center.

According to the relevant person in charge of Hongtu Innovation Fund Management Co., Ltd., this expansion of Hongtu Yantian Port REIT is a high-standard warehousing and logistics adjacent to the core container terminal in the core first-tier cities where the newly purchased assets are the most scarce and the leasing market is the most active. facility. The primary and secondary industries gradually recovered in the first half of the year and are expected to promote the recovery of the tertiary industry in the second half of the year. The recovery of the economy and the rise of import and export trade in the later period will increase the demand for storage leasing of third-party logistics and cross-border e-commerce, and the development of the port warehousing and logistics industry. will continue to earn. “In addition to the original equity holders, 9 institutional investors participated in the strategic placement. Many institutional investors also showed their willingness to actively participate in the stage of private placement expansion. In the bidding part, there was a premium subscription. Overall, institutional investment People also have better acceptance of the expansion.” The person in charge said frankly.

“For us, public offering REITs can speed up the operation of funds and revitalize stock assets. After the expansion path is cleared, public offering REITs will provide more help for enterprises.” As the original equity holder, the relevant person in charge of Shenzhen Port Group also said, The expansion of fundraising will help the group to further expand the scale of asset management, promote the integration of light asset operations with the market, attract social capital to participate in infrastructure projects, and help revitalize stock assets and form a closed loop of investment and financing.

 The two-wheel drive pattern of “first launch + expansion” appears

From the perspective of industry insiders, public infrastructure REITs, as a platform for asset listing, have the function of mergers and acquisitions. Acquisition of new assets through continuous expansion of financing is a manifestation of the value of infrastructure public REITs as a platform for mergers and acquisitions, and it is also a sign of the growth of infrastructure REITs important manifestation. With the normalization of the two-wheel drive of public offering REITs “IPO + expansion”, the liberalization of consumer infrastructure pilots, and the continuous improvement of regulatory policies, China’s public offering REITs has the world’s largest stock of infrastructure assets in China. It will also continue to grow, and market participants and asset types will also become more abundant.

Jiang Xiangyang, chairman of Bosera Fund, said that my country has formed a large number of high-quality assets in infrastructure fields such as transportation, energy, ecology, environmental protection, water conservancy, and urban construction. At the same time, technological innovation and green development will continue to produce new and high-quality infrastructure assets. China’s REITs market has broad development space and huge development potential. The relevant person in charge of China Merchants Shekou also said that in the process of normalization exploration and promotion, it is believed that market investors will evaluate the investment value of infrastructure REITs more objectively and rationally, and become long-term value investors. my country’s infrastructure REITs are in the ascendant and have a promising future.

Bosera Fund said that with the support of policies, the speed of market expansion will be further accelerated, and at the same time, the types of underlying assets will be more diversified. At present, assets such as scenic spots, rail transit, consumer infrastructure, and railways are also advancing. Combined with the background of this round of asset securitization innovation, it is all carried out on the premise of revitalizing state-owned assets. The stronger the public welfare attributes of the people’s livelihood, and the greater the space for assets with large surviving volume in the future to be packaged. With the acceleration of primary issuance and the expansion of different asset types, product qualifications, scales and returns will inevitably diverge, which will also bring different investment perspectives to investors.

The secondary market is expected to improve marginally

In recent years, the public offering REITs market has developed rapidly under the background of infrastructure construction and supporting policies. Statistics from the Tebon Securities Research Institute show that the 28 infrastructure public offering REITs that have been issued and listed so far have an issuance scale of 90.892 billion yuan, with an average first-day rise and fall of 12.89%. On June 16, Bosera Shekou Industrial Park REIT, Huaan Zhangjiang REIT, Hongtu Innovation Yantian Port REIT, CICC ProLogis REIT, which were the first batch of fundraising expansions, rose 2.62%, 2.22%, 1.93% and 1.30% respectively on the day.

“After the fundraising is completed, it will provide the fund with an additional source of income and diversify certain investment risks. At the same time, the structure of fund share holders may change after the fundraising expansion. The original fund share holders will share with the new fund shares The holders jointly enjoy the rights and interests brought about by the infrastructure projects already held by the fund and the newly purchased infrastructure projects. The increase in the size of the fund brought about by the expansion and the introduction of new investors will help to improve the secondary level of the fund. Market liquidity.” said the relevant person in charge of the aforementioned Bosera Fund. CICC ProLogis also stated that the original rights holders revitalize the stock of high-quality assets through the initial offering and expansion of funds to achieve high-quality growth. At the same time, for investors, the expansion of funds is also conducive to further diversifying the regional risks of asset portfolios and improving the management efficiency of underlying assets , to continuously create stable income and improve investment returns for investors.

Faced with the pressure of continuous price correction in the secondary market this year, many institutional sources said that with the continuous advancement of market improvement and fundraising expansion, prices have gradually returned to rationality, and some REITs products have long-term allocation value. The current factors affecting the secondary market price of its REITs involve macroeconomics, interest rate levels, stock and bond market performance, investor structure, market sentiment and many other aspects.

“Although the operating performance of some publicly offered REITs products in 2022 and the first quarter of 2023 is not as expected, we believe that the negative information on these operating performance has been over-interpreted.” An institutional source said that this caused some The impact of investors’ stop loss line and the spread of pessimism to other REITs products. “But in fact, the underlying assets of these projects are of high quality and have long-term allocation value. In addition, the current structure of investors in public REITs is still dominated by institutional investors, and the relatively converging investment behavior has also led to the magnification of the downward effect. “Sun Guiping, a senior fund analyst at the Shanghai Securities Fund Evaluation Research Center, also said that the adjusted long-term investment performance of REITs has improved significantly, and investment should be viewed from a longer-term perspective. In the future, the overall operating performance of REITs is expected to improve marginally, and the overall valuation is also expected to tend to a reasonable range.

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