The Chinese mutual fund markets saw the first publicly offered infrastructure-focused real estate investment trusts (REITs) on Monday, over ten years after the idea was initially suggested and subsequently mooted, reported Caixin.
The new REITs debuted on the Shanghai and Shenzhen exchanges and differ from previous iterations by being focused on infrastructure projects rather than commercial real estate. The projects are in sectors such as garbage disposal, industrial parks, toll roads, biomass power stations, and warehousing and logistics facilities. Over 1.5 million investors subscribed to the REITs raising a total of RMB 30 billion ($4.6 billion).
The REITs made a strong start, with all nine opening higher as investors showed their enthusiasm for the new type of equity securities. Although they gave up some of their gains by the end of the day, they still outperformed the broader market.