Analysis Of Financing Channels For Small And Medium Real Estate Enterprises Based On Multiple Case Studies

As the pillar industry of our national economy, the real estate industry plays a vital role in the process of economy development. The real estate industry is a capital-intensive industry that runs a long circle with projects demanding a large amount of investment. Combining the double function of investment and consumption, the real estate industry could also affect more than fifty related industries, from which we can tell how significant the real estate industry is.China’s real estate market experienced a booming decade, during when its demand for funds grows rapidly. In 2011,the regulation to the real estate industry becomes tight, limiting the purchasing and credit. The tight policy challenges the single channel of over relying on bank loans. The management problem and credit lacking already exists in our small and medium real estate companies, hindering them from approaching to commercial bank loans. Under such macro-control background, these companies would inevitably encounter financing bottlenecks.The article analyzes the current situation and the causes of financing difficulties of small and medium real estate enterprises. Then put forward several new financing channels to expand direct financing and establish a multi-level capital platform for small and medium real estate companies. From now on, the trust is the second largest financing channel after the bank loan. Many real estate companies are also currently financing through the trust since this kind of financing channel is flexible and already covers all phases of real estate development. The author analyzes several cases corresponding to each trust-financing model, which focuses on REITs since the author considers REITs would be the future direction of financing for small and medium real estate enterprises.The diversification of real estate financing is an inevitable trend. The small and medium real estate enterprises should follow the financing theory of first internal then external and optimize the internal asset structure. Then choose the most suitable way to build multi-level financing system.