Research On The Construction Of Shanghai Pension Real Estate Financing Model Based On REITs

With the continuous development of science,technology,medicine,and the environment,the phenomenon of population aging has become more and more obvious,especially in Shanghai.Shanghai is the earliest area that enters an aging society in China.The continuous expansion of the aging population has accelerated the continuous development of the pension industry and the pension real estate has emerged.Elderly like the pension real estate for that it provides them with integrated services for eating,clothing,housing and transporting.Thus,pension real estate is the development direction of the pension service industry.However,as pension real estate is still in its infancy in China,many old-age care services are still being explored and now there is no mature operating system suitable for China’s national conditions.Besides,there are a series of problems in pension real estate,especially in pension real estate financing.Compared with the common real estate project,the pension real estate has higher construction costs and operating costs,longer pay back period,and more uncertain factors.Even if the market is optimistic about the pension real estate’s future development,the huge capital demand will make companies prohibitive.Therefore,in order to promote the development of old-age care in China,we have to solve the problem of financing.As an innovative financing tool,REITs(real estate trust investment funds)have the characteristics of strong liquidity,high returns,and low risks.while due to the constraints of China’s market environment and policies,the development speed of REITs is very slow.However,in recent years,China has accelerated the development of REITs’ s systems,the REITs financing method will surely develop rapidly in our country’s market.ve to solve the problem of financing.Therefore,this paper proposes that we should apply REITs(Real Estate Trust Investment Fund)to solving the problem of pension financing for theelderly,which can not only solve the financing difficulties of pension funds,but also promote the development of REITs in China.Firstly,this paper analyzes the current financing mode and operating model of Shanghai’s existing pension real estate and forecasts the market demand through the Binary Logistic regression model.In addition,it analyzes the shortcomings and obstacles of the existing financing model by the value chain theory and draws the conclusion that the traditional financing model can no longer satisfy the development of the pension real estate.It also demonstrates the huge space for the development of Shanghai’s pension real estate.Secondly,by analyzing the characteristics,development status,market environment,potential investors and market performance of REITs,the paper demonstrates the necessity and feasibility of using REITs in Shanghai’s pension real estate,which is also the premise of the project planning.