Research On The Application Of REITs In My Country's Retail Industry Financing

With the rapid development and continuous popularization of the Internet in China,e-commerce enterprises emerge suddenly,which has caused a huge impact on the operation status of traditional retailers.In order to achieve sustainable development,transformation has become the main development direction of Chinese retail enterprises in recent years,resulting in increasing capital demand.Meanwhile,the financing of retail enterprises is characterized by narrow financing channels and large financial risks.In the background of soaring capital demand and the country's efforts to promote deleveraging,it faces financing difficulties.Since 2014,the development of asset securitization business in China has been gradually accelerated,and real estate trust and investment fund(REITs),as a form of asset securitization,has also been used,bringing new opportunities for retail enterprises with more commercial property assets and solving their financing difficulties.Suning is the first retail enterprise to test the water of REITs financing in China,and it has a large release scale,a large number,and a successful exit,which is of typical significance.Therefore,this paper selects Suning REITs as the case study object.This article adopts literature and case analysis to first sort out the literature on the financing status of the retail industry and the application status of REITs.Then it analyzes the feasibility and necessity of applying REITs financing in the retail industry in combination with the specific environment,and introduces the application status of REITs financing in the retail industry.Finally,the application of Suning REITs is analyzed.Specific,case part according to Suning financing condition and enterprise background lead to the issuance of REITs reason,after the key link of the design and exit link is analyzed,including the quality of the underlying assets of the principal redemption guarantee,double-layer structure design,a reasonable tax avoidance,multiple credit risk isolation and measures to implement the credit enhancement and secondary REITs exit pressure relief of funds.The application of Suning REITs broadens its financing channels,brings a positive market effect,and achieves the effect of improving operation capacity,improving capital structure,optimizing financial statements and reducing financial risks.At the same time,Suning REITs also has shortcomings,including the inability of ordinary investors to participate,lack of liquidity,too much reliance on strong credit entities for product issuance,immutable financing scale and double taxation.Based on the application experience of Suning REITs,this paper draws the following conclusions: REITs is a financing method in line with the development direction of retail enterprises;High-quality underlying assets are the guarantee for the successful issue of Suning REITs;A reasonable and optimized transaction structure can reduce the tax burden of the issuer.At the same time,in order to realize the rapid promotion of REITs in the retail industry,this paper proposes the following Suggestions for the shortcomings of Suning REITs:(1)Improve legislation and supervision and promote the standardization of REITs;(2)Improve risk pricing system;(3)Encourage the issuance of storage racks and formulate an expansion mechanism;(4)Formulate tax incentives.