Public REITs Secondary Market Continues Decline, Data Center Sector Led Gains Last Week, Commercial Real Estate REITs Filing Accelerates

“Daily Economic News” has learned that last week, the secondary market for publicly offered REITs continued its downward trend. As of last Friday (March 13), the CSI REITs (closing) and CSI REITs Total Return Index closed at 786.17 points and 1023.15 points, respectively, with weekly returns of -0.46% and -0.43%.

Data from Guosen Securities (002736) shows that from the beginning of the year, the major indices ranked by gains and losses are: CSI Convertible Bonds (+3.4%) > CSI REITs (+1.0%) > CSI 300 (+0.8%) > CSI All Bonds (+0.6%).

According to Wind data, among the 79 listed public REITs products, the number of those rising week-over-week increased to 31. The top three products with the largest gains are Huatai-PineBridge Jiuzhoutong (600998) Pharmaceutical Warehousing and Logistics REIT, Guotai Junan (601211) Jinan Energy Heating REIT, and Southern Runze Technology Data Center REIT; the 47 products that declined and 1 that remained flat. The three with the largest declines are Harvest JD Storage Infrastructure REIT, Bosera Jin Kai Industrial Park REIT, and Bosera Shekou Industrial Park REIT.

Industry-wise, the pace of commercial real estate REITs advancing has recently accelerated. The application of Hongtu Innovation Galaxy REIT as a private enterprise participation model provides an important example, while the bidding for Guangzhou Langhao Hotel REIT enriches the hotel sector and local state-owned enterprise revitalization paths, demonstrating ongoing diversification of market entities and asset types.

Secondary Market Continues to Decline, Data Center Sector Leads in Gains

Last week, the public REITs secondary market continued its downward trend. As of last Friday (March 13), the CSI REITs and CSI REITs Total Return Index closed at 786.17 and 1023.15 points, respectively, with weekly declines of 0.46% and 0.43%.

Looking at underlying assets, data from China International Capital Corporation shows that last week, the total return indices for various sectors changed as follows: +0.73% (Data Centers), -0.01% (Energy), -0.11% (Municipal Environmental Protection), -0.22% (Consumer), -0.29% (Expressways), -0.59% (Lease Housing), -0.67% (Warehousing & Logistics), -1.06% (Industrial Parks). Aside from the data center sector, all other REIT types declined.

Regarding individual products, among the 79 listed public REITs, the number rising week-over-week increased to 31. The top three with the largest gains are Huatai-PineBridge Jiuzhoutong Medical Warehousing & Logistics REIT, Guotai Junan Jinan Energy Heating REIT, and Southern Runze Technology Data Center REIT, which increased by 1.86%, 1.45%, and 1.43% respectively during the week.

The top ten public REITs by weekly gain are:

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The 47 products that declined and 1 that remained flat are also listed, with the three largest declines being Harvest JD Storage Infrastructure REIT, Bosera Jin Kai Industrial Park REIT, and Bosera Shekou Industrial Park REIT, which fell by 5.60%, 5.17%, and 3.89% respectively.

According to Tianfeng Securities, last week, the total trading volume of REITs was 444 million yuan, down 9.8% from the previous week. The transaction volumes for property rights and operating rights were 277 million yuan and 167 million yuan, respectively, with decreases of 9.2% and 10.7% week-over-week.

Breaking down by segment, last week’s transaction volumes for park infrastructure, energy infrastructure, warehousing & logistics, affordable rental housing, municipal environmental protection, transportation infrastructure, consumer infrastructure, and data center infrastructure REITs were 58 million yuan, 49 million yuan, 73 million yuan, 50 million yuan, 17 million yuan, 100 million yuan, 67 million yuan, and 29 million yuan, respectively, with changes of +6.3%, -24.0%, +11.7%, -12.0%, -0.8%, -4.2%, -19.4%, and -35.7% compared to the previous week. Among these, transportation infrastructure had the largest weekly transaction volume share at 22.6%.

New Commercial Real Estate REITs Filing, Multi-Level Market Development Accelerates

In industry news, last week saw new filings for commercial real estate REITs.

On March 10, Hongtu Innovation Galaxy Group filed for a commercial real estate REIT with the Shenzhen Stock Exchange. The original equity holder is Galaxy Industrial (Shenzhen) Co., Ltd. According to their website, Galaxy Holdings Group was established in Shenzhen in 1988, with diversified business including industry, real estate, commerce, capital, and property management, involved in industrial operations, real estate development, commercial management, hotel services, equity investment, and property services.

Additionally, CITIC Construction Investment (601066) reported that Wuxi City promoted five multi-level REITs cooperation projects, including Liangxi Yunhe Hui REITs, Wuxi Metro Group Line 1 REITs, Xinwu Micro-Nano Park Infrastructure Public REIT, Xifa Group Industrial Park Inter-Agency REIT, and Huishan High-Tech High-End Equipment Park Inter-Agency REIT.

Guangzhou’s first pure five-star hotel public REIT project has also announced tenders. On March 10, Guangzhou Haizhu Urban Construction Development Group issued two tender notices for the selection of fund managers, plan managers, and financial advisors for its Langhao Hotel commercial real estate public REIT project. The Haizhu International Convention and Exhibition Center Langhao Hotel involved is a core asset of the district-owned state enterprise.

Furthermore, CICC-Bolin long-term rental apartment holding-type ABS, Caitong Asset Management-Ates holding-type real estate ABS, and CICC-Jingshun warehousing & logistics holding-type real estate ABS have received feedback from the Shanghai Stock Exchange; Huzhou Urban Group’s agricultural products logistics center holding-type real estate green ABS, and China Railway Seventh Bureau’s Taiheli holding-type real estate ABS have been approved by the SSE, among others, indicating accelerated development of the multi-level REITs market.

On policy, on March 11, the Shandong Province Financial Policy Briefing was held, proposing flexible use of commercial real estate REITs, sci-tech innovation convertible bonds, and other innovative tools to broaden diversified financing channels. On March 13, Xinhua News Agency officially released the “14th Five-Year Plan” outline, emphasizing active promotion of the regular issuance of infrastructure REITs.