Research On REITs Operation Of Dongfang Trust

With the development of economic globalization and the continuous deepening of financial reform, competition among commercial banks becomes more competitive. It is particularly iREITs (Real Estate Investment Trusts) is a new type of financial product. It make funds from individual and institutional investors together to reinvestment to real estate projects that can generate stable cash flow and income. To meet the needs of long-term investment, REITs raise the funds to purchase high-quality real estate assets and establish a large portfolio of real estate assets with the appropriate management.REITs is able to establish new financing channels and the capital exit channel, is conducive to contact the real estate market and the capital market; REITs can reduce the risk of the real estate cycle, improve the liquidity of real estate; also help to promote the development of the real estate industry to subdivide.REITs favor dispersion and reduce financial market systemic risk and improve the country’s financial security; deepen the capital markets, providing price information and improving market efficiency; is conducive to spread the credit risk of the banking system. REITs can bring competitive bonus and good benefits; conducive to macroeconomic stability and the development of economic globalization. REITs is an effective tool of tax avoidance to meet diverse investment needs.It is necessary to develop REITs to Xingye trust. First of all, it can broaden the financing channels of finance customer, reduce the risk of bank loans to support the healthy and stable development of the real estate business. Second, it can separate direct investment demand on the real estate market, optimize the investment direction. Finally, it can accelerate the innovation of financial products, to broaden the investment channels of investment in customer funds.Xingye trust REITs should choose C-REITs mode. The Trust has development Contractual-based fund for many years, has accumulated a lot of valuable experience in the practice, which can provide guidance for contractual REITs run. In the actual construction process, should use the public offering mainly with the public-private floatation, take first closed after open transactions, The investment should be directed to the good quality commercial real estate, some of the real estate market segments and main government low-rent housing projects.Xingye trust must attach importance to risk control and strengthen risk management, should strengthen the awareness of risk aversion and control project risks from the source; establish a mechanism of risk diversification to try to disperse the non-system risk; Strengthen the internal control system, and strengthen risk monitoring.