Study Of Commercial Real Estate Financing Channels

Commercial real estate is a long-term project with continuous and high investment, the rolling development model which was commonly used in real estate is not applicable for it. It needs the developer has strong capital chain to operate a successful commercial real estate projects, but that is the short board of Chinese most real estate developers. The connection of commercial real estate industry and the capital markets is not high, in addition to bank loan, most development companies have no other financing channels. Single and simple mode of financing channels has become the constraint to commercial real estate developers.Because of short-term development in China, the research doesn't form a theoretical system, but only is limit to the explanation to surface phenomena. This article starts from the overview and development situation of commercial real estate, analyses its development mode and features, then summarizes the significance of financing channels for the whole process of commercial real estate development, show the current situation of financing market and its problems. The financing channels are unimpaired and lack of relevant policies, institutions, laws and regulations. In view of this situation, author makes a summary of various financing channels of commercial real estate, and analyzes the characteristics, advantages and disadvantages of each channel, then chooses appropriate financing model for different types of businesses."Study on financing mode" is assumed to be supply, demand and product model in this article. The product is financing channels, and providers of these channels are government regulators, the demanders of the channel are the development enterprises. First, the provider (government) should establish a sound regulatory system to ensure the smooth flow of various financing channels. Second, enterprises should choose a reasonable financing model according to their own characteristics, and combine into an appropriate financing mode.There are many barries about the application of financing channels in China, such as polices, laws and regulation. On the other hand, developers don't make full use of these channels due to the restraints about their scale and unacquaintance to the capital market. Diversification is the developing trends in the future, it is very important for the improvement and development of financing channels to analyze the successful and aborted cases about financing. In the case of small and medium-sized developers, the Negative Externality of bad financing channel is more serious than big developers. So, the different developers should choose the most suitable channels for themselves.