Research On The Financing Model Of Infrastructure Public REIT

Real Estate Investment Trusts,REITs,originates from the United States and is a financial instrument more commonly used in the real estate sector in developed countries,which refers to the fund company raising funds from the public through the issuance of marketable securities and investing in The fund company raises funds from the public by issuing securities and invests them in the operation and construction of real estate,and then distributes the proceeds to investors on a regular basis.The launch of public REITs in China today is of great significance in the context of economic growth rate shift,"housing without speculation" and financial supply-side reform.The first batch of infrastructure public REITs in China will be listed on June 21,2021.This paper selects the representative "Hua’an Zhangjiang Everbright REITs" as a case study,and analyzes the feasibility,structure and financing effects of its public REITs financing model based on capital structure theory and risk segregation theory.We analyze the feasibility,structure,and financing effects of the public REITs financing model.The feasibility of the financing model is divided into external and internal factors,mainly because China continues to introduce preferential policies for infrastructure public REITs,and internal factors because of the restricted financing methods of enterprises,coupled with the superior geographical location and high-quality underlying assets of Zhangjiang Everbright Park,the issuance of public REITs can better promote its development.The structure of financing model adopts the design of "public fund + special plan + project company",among which there are "dual SPV","reverse absorption merger","equity + debt",etc."The purpose is to prevent financial risks,save operating costs and improve operating efficiency.In terms of the effect of the financing model,the issuance of public REITs has realized the "exit" of the underlying assets of the project company,and the Z-score model has shown that the issuing enterprises are operationally sound,financially healthy,and have very low probability of bankruptcy,and the issuance of public REITs has enhanced the enterprise value and brought positive effects to the market.After the study,it is concluded that China’s infrastructure public REITs can open up a virtuous cycle of industrial capital and finance,revitalize stock assets,alleviate local government debt,play a role in deleveraging for enterprises and preventing financial risks,and also provide investors with a medium-return,medium-risk investment tool.