Research On Innovative C-REITs Financing Modes In China's Real Estate Industry

The real estate industry is inseparable from the national economic development.It is closely watched by the government and the public,and it often indicates the economic situation to some extent.Since the Reform and Opening,China's real estate industry has benefited from the strong support of government policies in the early stage of development.It relies on the rapid development of bank loans under high leverage,but it also brings the real estate bubble problem.Compared with general enterprises,the real estate industry has the typical capital-intensive characteristic,and financing activities are the key to the survival and development of real estate enterprises.Since the end of 2016,because of the monetary tightening and the control policy of real estate industry,the difficulty of financing and high financing costs have become an important reason for restricting the development of real estate enterprises.Therefore,real estate enterprises have begun to innovate and explore various new financing methods.With the f the national policy of calling for rent and sale and the encouragement of REITs which is an innovative financing tool,Poly's “C-REITs” financing model has emerged.This paper adopts the case analysis method,in view of the theory of financing and asset securitization,based on the analysis of the development and financing status of China's real estate industry,through the research on Poly “C-REITs” case,to test and verify the necessity and feasibility of this financing model in the real estate industry.Through case studies,it is found that:(1)In this case,“C-REITs” financing model has a cost advantage,lower than equity and trust financing;and compared with the slightly lower cost of credit and corporate debt financing,it has low threshold and fast speed.Real estate companies can choose “C-REITs” financing to obtain financing at a lower cost and form a diversified financing advantage.(2)Using the event research method,the “C-REITs” financing model of this case can bring a positive market reaction in the short term,and improve investor confidence to drive the stock price to rise and release the positive effect.Due to the short application time,companies still need to continuously improve their business performance to enhance long-term investor confidence.(3)In this case,the “C-REITs” financing model can effectively improve the company's short-term solvency,not to increase financial leverage,and alleviate the trend of deteriorating asset operating efficiency in the winter.This paper selects the case of the first real estate company's storage-type “C-REITs” financing model as the research object,which has not attracted much attention in the domestic academic circles.This paper provides a new idea for the real estate industry financing research.In the past,the research on the innovative financing model of “C-REITs” in the real estate industry often stayed in the necessity analysis and the obstacles to the development of REITs in China.This paper supports the feasibility of the country through the analysis of the cases and the comparison of the data.Through the analysis of its cost-effectiveness,financial performance,market response and reproducibility,it is expected to serve as the theoretical support for the continuous development of REITs in China.