China Development Real Estate Investment Trust Feasibility Analysis

Based on deep observation of successful management of Real Estate Investment Trusts (hereinafter referred to as REITS)in western countries, this study is tailored to focus on the necessity and feasibility of developing REITS in China and its possible organizations and models.The study has four parts. In Part 1, a brief introduction of REITS shall be given, i.e., its definition, types, organizations and capital resources, special attention shall be paid on its functions and investing fields. Part 2 shall be a systematic description of REITS developed in western countries. Part 3 shall be an analysis of developing REITS in China, which shall be argued from three aspects, i.e., policy-making, legal issues and practical operation, mainly concerning its risk and problems. Part 4, the most important part in the study, shall be a detailed discussion of the possible operating models and approaches for developing REITS in China based on the reality of China.My study concludes that Developing REITS in China shall have beneficial influence to Chinese economy. First of all, REITS shall be used to perfect the financial system of real estate market in China by providing new capital resources, which will decentralize the systematic financial risks, reduce the negative impact of financial policy changing, optimize the resources disposal and help the investment trust market more healthy in China. Secondly, REITS shall provide a well ordered investing field, i.e., real estate market, to investors, especially to those small and medium capital holders. Due to its good character in nature, e.g., good fluidity, high profitability and steady price in market, REITS shall be an ideal tool used for capital value maintenance and increment.