Commercial Real Estate REITs Usher in a "Boom Period," Real Estate Developers Become Main Force

By December 31, 2025, the China Securities Regulatory Commission officially launched the pilot program for commercial real estate public REITs, opening a new capital channel for the long-dormant commercial property sector.

On March 16, the Red Earth Innovation Galaxy Group Commercial Real Estate REITs, filed by Galaxy Holdings, received acceptance from the Shenzhen Stock Exchange, becoming the 15th commercial real estate public REIT approved by the exchange this year.

According to a review by the Daily Economic News, as of March 20, 2026, just 80 days after the pilot was launched, the Shanghai and Shenzhen stock exchanges had accepted 15 applications, with a planned fundraising total exceeding 46 billion yuan, nearing the total issuance of public REITs for the entire year of 2025 (including follow-on offerings).

Additionally, four major asset types—commercial complexes, retail commercial properties, office buildings, and hotels—have become the main underlying assets, with property developers shifting from peripheral testing to leading participation.

Notably, among the 15 REITs projects filed, seven were filed by property companies as the original equity holders, including Poly Developments, Shoukai Shares, Xincheng Holdings, and others.

“The rapid expansion of the commercial real estate REIT pilot reflects an important shift in China’s real estate market from incremental development to stock operation,” said Yan Yuejin, Deputy Director of the Shanghai E-House Research Institute, on the afternoon of March 20. He explained that the opening of commercial REITs has enabled property firms to connect their existing assets with the capital market effectively.

Over 46 billion yuan in fundraising wave

This wave of commercial real estate REIT filings shows two notable changes: first, the fundraising scale has set a short-term new high within the public REIT pilot field, closely approaching the total issuance of public REITs for 2025; second, the underlying assets of the REIT projects are mostly high-quality properties in core areas, with relatively high occupancy and rent collection rates.

The opening of commercial real estate REITs has immediately triggered a market boom, with both the speed of filings and the fundraising scale breaking industry records. From the first batch of projects starting application at the end of January 2026 to March 20, the Shanghai and Shenzhen exchanges had accepted 15 applications, with a total fundraising amount exceeding 46 billion yuan.

In addition to the large number of applicants and high total planned fundraising, a core feature of this wave of filings is that most underlying assets are high-quality properties in key areas.

Specifically, the underlying asset of Hu’an Lujiazui REIT is the Jingyao Qiantan project in Shanghai Pudong; Poly Developments filed the Huaxia Poly Development REIT, which includes Guangzhou Poly Center Office Building and Foshan Poly Water City Shopping Center; Shoukai Shares used commercial assets such as Beijing Huaqiao Village Commercial Street, Puti Commercial Street, and Songjiazhuang Fumao as targets; Xincheng Holdings’ application includes Changzhou Tianning Wuyue and Nantong Qidong Wuyue Plaza; Galaxy Holdings’ latest application, Red Earth Innovation Galaxy REIT, has Shenzhen Longgang Galaxy COCOPark Shopping Center and supporting parking as underlying assets.

For example, the Red Earth Innovation Galaxy REIT filed by Galaxy Holdings has the Shenzhen Longgang Galaxy COCOPark Shopping Center as its underlying asset, located at the intersection of Longgang Central City and Dayun New City. According to the prospectus, as of the end of 2025, the shopping center’s occupancy rate was 99.34%, rent collection rate was 100%, with an estimated fundraising scale of 1.686 billion yuan.

The Hu’an Lujiazui REIT filed by Lujiazui in Shanghai has the Jingyao Qiantan project as its underlying asset, including T1 office building and shopping mall formats, with an estimated fundraising amount of 2.81 billion yuan. The prospectus shows that by the end of 2025, the office building’s occupancy rate reached 95.93%, and the shopping mall’s occupancy rate was between 93% and 95%. Over the past three years, rent collection rates have remained stable above 99.7%.

Furthermore, the participants in this wave of REIT filings are diverse. The filings include local state-owned enterprises like Shou Nong and Shoukai, private developers such as Galaxy and Xincheng, as well as foreign-backed operators like Chongbang Group, breaking the previous market pattern dominated by state-owned capital in infrastructure REITs.

On March 20, Zhu Yuanwei, Director of the Reits and Real Estate Finance Research Institute, analyzed for the Daily Economic News that: “From the perspective of capital providers, public REITs have gradually become an important channel for allocating alternative assets. In the context of widespread asset scarcity, REITs provide a new asset allocation avenue. Commercial real estate REITs have increased asset supply and offered more options for investment institutions. It is understood that competition for strategic allocation quotas among multiple filing projects is very fierce.”

Property developers entering the main battlefield of public REITs

A review of property developers’ REITs strategies shows that since 2021, only about 10 developers—including China Merchants Shekou, China Resources Land, China Jinmao, Vanke, and Joy City—have engaged in REITs, with two products having completed follow-on fundraising.

By 2024, consumer infrastructure REITs experienced a small peak, with seven products listed throughout the year, but they remained limited to consumer formats, without forming a full industry participation pattern. Most developers were still in a wait-and-see testing phase.

However, the opening of commercial real estate REITs at the end of 2025 marked a turning point for developer participation. Seven developers—including Poly Developments, Xincheng Holdings, Shoukai, and Galaxy Holdings—filed a total of seven commercial real estate REITs, accounting for nearly half of the 15 total filings.

Some industry insiders believe that in the past, developers played a marginal role in the REIT-like market mainly due to the lack of standardized, publicly listed exit channels, making it difficult to efficiently monetize existing assets. The launch of commercial real estate public REITs provides a new path for developers to “sell equity while retaining operational rights.”

Yan Yuejin explained that the introduction of public REITs allows developers to recover capital by selling project equity while maintaining operational control.

“Currently, developers are applying to list their commercial plazas as underlying assets and plan to participate in strategic allocations proportionally. This ‘retain core shares + activate stock’ model both locks in future operational income and enables immediate capital recovery, representing a typical ‘light and heavy’ transformation approach,” Yan said.

Zhu Yuanwei added that commercial real estate is more demanding in terms of operational capability: “Operational management and development capabilities for commercial real estate are two entirely different organizational skills, with different talent systems, incentive mechanisms, and evaluation logic. REITs have opened the door, but whether they can go further depends on operational strength.”

According to E-House Research Institute, three types of assets are expected to become mainstream in future commercial REIT filings: first, first-tier and key second-tier city Grade-A office buildings and high-end shopping centers, which serve as market stabilizers due to their scarce locations and high-quality tenants; second, well-performing assets like community shopping centers with renovation potential in third- and fourth-tier cities, which attract capital with high distribution rates; third, specialized assets such as hotels, senior care properties, and特色街区, which require high operational standards. If they possess strong branding and customer flow, they could become dark horses in niche segments.