China Fund News reporter Zhang Yanbei
At a critical moment in the market, REITs have taken action.
CICC GLP REIT recently announced that the management of GLP, the original equity holder, intends to jointly fund the establishment of a special asset management plan in accordance with the law, and increase its holdings of the fund by buying in the secondary market or other methods approved by the exchange, with a total amount of not less than 80 million yuan and no more than 100 million yuan.
This is the first shareholding increase initiated by the management of the original owner of a REIT in China, which has previously increased the holdings of the original owner and its persons acting in concert. So far, 12 public REITs have been announced to increase their holdings this year, and the amount of REITs products announced to increase their holdings has exceeded 2.1 billion yuan during the year.
According to the industry, the increase in REITs by the original equity holders and management stems from the confidence in the operation and future development prospects of infrastructure projects and the recognition of long-term investment value, with the aim of supporting the sustainable, stable and healthy development of the fund. Increasing holdings can help enhance investor confidence or boost the product's performance in the secondary market to a certain extent.
The management of the original owner of CICC Prologis REIT announced that it was the first time that the management "self-purchased"
During the year, there was another case of increased holdings of REITs products.
On December 16, CICC Fund announced that on December 14, the fund manager received a notice from GLP China, the original owner of CICC GLP REIT, that the management, including the current key senior management of GLP China (hereinafter referred to as the "management involved in the increase"), intends to jointly fund the establishment of a special asset management plan in accordance with the law.
The relevant asset management plan will be actively managed by the asset manager of the relevant asset management plan for the purpose of purchasing shares of the Fund in the secondary market or increasing its holdings in other ways acceptable to the Exchange.
According to the announcement, the total amount of this increase will not be less than RMB 80 million and not more than RMB 100 million. The implementation period is from the completion of the establishment of the relevant special asset management plan to December 31, 2024.
The asset manager of the relevant special asset management plan shall increase its holdings according to the fluctuation of the fund transaction price and the overall trend of the secondary market, and on the premise of complying with laws and regulations, the regulations of the Shanghai Stock Exchange and the asset management contract of the asset management plan.
Relevant sources said that GLP China's management invested in the establishment of an asset management plan, which first represents its long-term optimism about the investment value, location advantages and structural upgrading and development trend of the underlying assets of CICC GLP REIT.
"More importantly, based on the forward-looking insight into market demand trends, the management team is confident in continuously improving the value of assets with its leading infrastructure asset operation management system and industrial service capabilities, and on the whole, it also reflects its firm belief and support for the future development prospects of the mainland public infrastructure REITs market. The person said.
It is worth mentioning that this is the first shareholding increase initiated by the management of the original REIT owner in China, and the main body of the previous increase was the original owner of REITs products and their concerted actors, rather than the management.
On the same day as the announcement of the increase in capital contribution by the management of the original equity holder, CICC Prologis REIT announced that it would pay the third dividend in 2023 with September 30 as the base date for income distribution.
It is understood that the historical dividend performance of CICC Prologis REIT is stable, and it has completed a total of 5 dividends, with a cumulative dividend amount of about 580 million yuan and a dividend ratio of nearly 100%, providing investors with stable returns.
After the completion of this distribution, the cumulative distribution amount of CICC Prologis in REIT2023 year is 246 million yuan, accounting for 95% of the cumulative amount available for distribution in the year ending September 30, 2023. Based on the closing price on December 14, 2023, the annualized net cash flow distribution ratio of CICC Prologis REIT2023 is forecast to reach approximately 5.77%.
Looking at the three warehousing and logistics funds currently listed, CICC Prologis Warehousing and Logistics REITs is one of the first batch of infrastructure public REITs in China, and it is also the first "warehousing and logistics" infrastructure REIT on the Shanghai Stock Exchange. Since its initial issuance and expansion of shares, the operating data of CICC Prologis REIT has been positive, and the operation of the underlying assets has been stable.
GLP and CICC Fund told reporters that the two parties have been working closely together to implement the continuous and high-quality operation of CICC GLP REIT assets, and are committed to actively giving back to investors, creating stable returns for investors, and jointly helping the high-quality development of the public infrastructure REITs market.
REITs have ushered in another round of "self-purchase" waves, and since late October, they have intensively announced their holdings
From a long-term perspective, after a brief recovery, the secondary market of public REITs has fallen into adjustment since late October, and many original owners of REITs products and their concerted actors have increased their holdings.
After falling to the point of suspension, ChinaAMC Hefei High-tech REIT quickly ushered in an increase in holdings. On November 30, Huaxia Hefei High-tech REIT announced that the original owner of Hefei High-tech increased its shareholdings.
In early November, CICC Anhui Traffic Control REIT, Guotai Junan Lingang Innovation Industrial Park REIT, and CCB Zhongguancun REIT also disclosed their respective plans to increase their holdings of their original owners or related parties and controlling shareholders of the original owners.
In addition, Guojin China Railway Construction Expressway REIT announced a plan to increase the shareholding of the original equity holders in late October. It is estimated that the total amount of the "self-purchase wave" of public REITs starting in late October is expected to be 954 million yuan, including the increase in the management of the original equity holders of CICC Prologis REIT.
As far as the year is concerned, the amount of REITs products announced to increase their holdings has exceeded 2.1 billion. Since the beginning of this year, the secondary market price of public REITs has seen a significant correction. In order to boost market confidence, from May to July, some original equity holders and their related parties intensively released plans to increase their holdings. After the last round of "self-purchase wave", the performance of the secondary market of REITs has rebounded significantly due to the frequent favorable policies and the gradual highlighting of the investment value of REITs.
At this stage, public REITs still maintain a low-level volatility trend in the secondary market. Whether the "self-purchase wave" of the original owners of REITs, persons acting in concert and the management of REITs in this round can inject a "shot in the arm" into the performance of REITs in the secondary market has attracted much attention from the market.
In this regard, a public offering person in South China said that the intensive increase in holdings of REITs original equity holders not only shows the confidence and positive attitude of the original equity holders, but also brings incremental funds to the REITs market, which may boost its secondary market performance to a certain extent. Judging from market feedback, some REITs began to show a significant recovery after the announcement of the increase in holdings. However, he also stressed that the secondary trend of public REITs products is also related to the overall performance of the market, liquidity and other aspects.
"However, it is certain that public REITs have recently ushered in a number of blockbuster good news, including the proposed inclusion in the investment scope of the social security fund. The injection of long-term funds will help further improve the liquidity of the REITs market and strengthen the rationality and effectiveness of market pricing. In addition, the news of a number of new product declarations last week also caused heated discussions in the industry.
Industry insiders generally believe that in the current stage of market low-level shocks, it may be a good time for investors to deploy REITs. In the medium and long term, the public REITs market will continue to expand in the future, and the development space is worth looking forward to.
Editor: Xiao Mo
Review: Muyu