REITs Research And Reflection About Its Combination With Chinese Market

As an important financial channel of realty industry, a new securities product too, REITs has gained rapid development in the securities business inside and outside the country in recent years.This thesis study the development process of REITs inside and outside the country in detail,particularly in American and Asian securities business , revealing two different development mode . REITs in America is the product of evolution of the US tax law ,belongs to the tax-law driving type. By the contrast, in the Asian countries and regions it develops by instituting special acts about the REITs, emphasizing each participant's qualification and responsibility , thus is the special legislation driving type.REITs products in America has been very mature through many years of development. At present REITs products in America are mainly of the capital-share type, whose market possession rate is over 95 percent. Because of the modification of the Amercian tax law and the change of the market environment, products structure and management strategy of American REITs are changing too. Asian countries and regions fully absorb the experience of the American REITs in the fields of the assets, management, distribution, revenue and so on, instituting the establishing condition of the REITs products which similar to that of America, making some corresponding modification and perfection. The research of investment characters of American REITs products shows that REITs products has the character of the fixed profit product and middle-little stock, and its total investment profit is lower than that of the high development corporation ,but higher than the bond, relating little to other finance assets. The development of the REITs product in our country can provide our realty corporation with a new financing method of long-term capital other than the bank lending, eliminating the finance risk resulting from that our reality corporation depends on the bank lending excessively. It can also improve the securities market's structure, providing many of the middle and little investors with the channel.So it is considered that our country has possessed the market environment that develops REITs products, and that it is a good way that REITs adopt an open realty investment fund.The net profit calculated by the traditional GAAP account criterion cannot truly reflect the cash flow of the REITs, so the FFO method is the rational evaluation method of the REITs value.