Research On The Development Of China's Real Estate Investment Fund

At present, China's economy is in a phase of rapid development. According to the statistics, in the nearly six years, China's real estate investment rose by an annual average of over 20%. And real estate sales also had an over 27% per annum growth rate. The real estate industry has become a pillar industry in improving people's living conditions, creating jobs and promoting China's national economic. The Real Estate Investment Trusts (REITs), in fact, it's a securitization of industrial investment funds. It aggregates funds by issuing a kind of certificates to the qualified majority of investors. Then the specialized investment institutions invest in the real estate by using this money, and return the proceeds to the investors by the ratio of their investment. For investors, the REITs is a good chance to invest in the commercial real estate. And the REITs also attracts a large number of funds by it's own advantages: clear investment performance, stable interest income and high liquidity and liquidity. The scale of global REITs was nearly 7,600 million dollars in the last year, and it's likely to be 8,200 billion dollars this year, and will reach 1.1 trillion dollars in the year 2010.As an effective indirect financial instruments, REITs provided a perfect chance for the country's real estate market's fully development. However, the systematic researches on the REITs's formation mechanism, regulations, practical use, and other aspects are still lack in our country. In order to ease the risks in financial system, particularly the potential risks in commercial banks caused by the real estate, People's Bank of China launched the first REITs 's research projects in January, 2007. Therefore, in the context of this reality, it is of great importance in theory and practice to have a serious research on the REITs's current development and obstacles.This article defies the concept of REITs by referring to the modern financial theories. Then by comparing the domestic and foreign real estate investment trusts' operation, this article raises the practical significance and the countermeasures of developing REITs in our country based on the advanced experience in the United States and Asia countries. The article is divided into three main parts, the first part (Chapter II) gives real estate investment trusts a general theoretical analysis, and introduces the real estate investment trusts' concept, classifications, unique advantages, and provides theoretical support for developing real estate investment in China. The second part (Chapter III) is about the real development of real estate investment trusts and the feasibility analysis of developing real estate investment trusts in China. In this part, it mainly analyzes the current situation and existing obstacles of the real estate investment trusts, and then give a clear proof for China REITs' future development in significance and feasibility. Part III (Chapter IV, V) expounds the path chosen of developing real estate investment trusts in China. By referring to the abroad REITs' development experience, this article explores the development path, and raises some relevant policy recommendations.The main innovations of this article are the definition of the REITs, the comparison of domestic vague concept and financial products with REITs, the clear explanation of REITs, and the framework of developing REITs in China. On the other hand, the shortcoming of this article is mainly on the analysis of actual operation of REITs in China. Meanwhile, the concrete path offered is relatively subjectively, and the rationality also need to be tested in practice.