From its launch in 2020 with an initial batch of nine offerings, the Chinese REIT (C-REIT) sector has since experienced rapid growth that to date has swelled to 27 listings with a total market capitalisation that hovered around US$10 billion at the end of April. Despite challenges faced by the outbreak of the pandemic and property market headwinds, returns have so far remained positive. Stocks have risen 8 percent on average from their IPO prices and have outperformed regional benchmarks over the past year, while payouts have been stable.

The authorities have from the beginning set the bar high for issuers. Assets need to have been in operation for three years with the ability to generate stable cashflows. Required rates of return, tweaked recently, are set at an IRR of not less than 5 percent for concession-based REITs, while the distributable cashflow ratio for property REITs is at 3.8 percent. Leverage is capped with a debt-to-asset ratio of less than 30 percent. No doubt,