REITs' Development Feasibility Study And Development Pattern Discussion In China

Under the conditions of the globalization and the quick development of the Chinese economy, there appears to be a quickly-development tendency in the Chinese real estate industry. Since the real estate industry is a fund-sensitive industry, the tendency of the industry call for the financial innovation in the Chinese real estate industry. Recently, a tool of the financial innovation in the real estate industry called"REITs"(the abbreviation of the Real Estate Investment Trusts) has been quickly developed worldwide, and attracted the attentions of the relative experts in the industry. According to the authoritative forecast, REITs will be one of the most important innovations of our country during the 21st century.There are many meanings for the development of the real estate industry,investors and financial system to currently promote REITs in our country. It can supply new fund for realty enterprise. It can decrease management risk from banks.It can promote the competition among the realty enterprises. It can make resources allocated suitably. It can promote realty enterprises to enhance management level. It can provide a new investment choice for the capital from the public. It can improve the liquidity of the realty assets. It is beneficial to make information from real estate industry more transparent. It can improve financial system in our country.Based on defining the real estate investment (trust) fund, and introducing the development situation of home and abroad, the article discusses the feasibility of establishing REITs in China separately from the real estate industry situation, the industrial background as well as experiences of the foreign developed countries or the local advanced districts. Moreover, the article analyzes the necessities to establish REITs from the government finical policies and contradictory between the bodies of trust suppliers and funds demanders.Finally,with the domestic cases and American experiences, the paper proves the certainties of appearance of real estate funds. It gets the model, which our country should adopt to develop real estate investment (trust) funds based on analyzing the current situation of real estate investment(trust) funds, existing problems and feasibilities in china.