China's Real Estate Investment Trusts (reits) Study

After 1999, as mainstay industry and growth engine of national economy, real estate industry contributed a lot to keep China's economy increasing. The characteristics of China's real estate market are featured by small enterprises, dispersive resources and deficiency in using social resources, which is out of the expectations what the real estate should be. There is a very close relationship between real estate market and financial market, but China's real estate market does not get full support from financial market. What's more, after People's Bank of China issued a series of polices to prevent real estate from developing in excess, the traditional financing channels of China's real estate enterprises have been limited. Accordingly, pushing the new financial tool is very urgent. Previous research showed that the real estate investment trust which has been invented in America originally is an efficient way to finance the real estate market.Chapter 1 is a brief overview of real estate investment trusts (REITs). It explained the definition, the nature and characteristics, the several types and the comparison between them, the basic operation model and the key operation processes of the REITs one by one.Chapter 2 proved the necessity and feasibility of developing RETTs in our country. In the aspect of necessity, the author proves from reducing the bank risk, widening financing channels, optimizing resource. In the aspect of feasibility, the author stated from real estate market and systems, REITs institution and investment subject.According to foreign countries' experiences, our country's present economy and system environment, Chapter 3 discusses the operation pattern of our country's REITs, and draws a conclusion that our country should choose contractual and closed listed property funds as REITs pattern in China. Then the author proposes the structure and functions of China's REITs, and gives some suggestions for the environment development of legal system, tax policy, talent training and etc.It is significant for real estate industry and capital market to develop REITs normatively. But at the present, REITs fund is mainly used into loan and invested singly that is high risk and worse liquidity. At the same time, there are not corresponding law and supervision mechanism in China. So there are immature opinions in the paper and I do some researches in the development of REITs in our country.