Practice Briefing China's commercial real estate recovery, REITs and tax policies

Olivia Muszynski and Mine Cinar

Journal of Property Investment & Finance, 2022, vol. 40, issue 2, 263-274

Abstract: Purpose - Commercial property market allows for the potential development of a similar real estate investment trust (REIT) structure in China as the commercial REITs (C-REIT) such as those offshore in Hong Kong and Singapore. Design/methodology/approach - The authors examine tax codes of the present real estate investment methods in China in order to understand the interest for a new vehicle that specifically focuses on commercial real estate. Findings - Given the progress of offshore C-REITS and Chinese government's emphasis on real estate, Chinese shareholders will benefit if onshore C-REITS are issued. Crucial to the success of C-REITS will be how the C-REIT shares will be priced with respect to Net Asset Value of underlying assets. Research limitations/implications - COVID-19 pandemic has changed government priorities, and development of C-REITS in real estate for growth may no longer be a priority policy for China. Practical implications - Liquidity in real estate markets will be enhanced by C-REITS due to participation of private investors. Social implications - Onshore C-REITS would allow small and individual investors to have a stake in their home country's commercial real estate as an investment security for their own future. Originality/value - This policy article also includes an interview with real estate professional in China whose opinions are embedded and added to the article.

Keywords: China; C-REITs; Commercial real estate; Onshore and offshore REITs; F3; G1; G2; O5 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jpifpp:jpif-03-2021-0024

DOI: 10.1108/JPIF-03-2021-0024

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