ESR Group has obtained regulatory approval in China to list its logistics real estate arm, ESR C-REIT, on the Shanghai Stock Exchange. This REIT will allow investors to collectively invest in income-generating logistics facilities, starting with three high-quality properties in Kunshan, Jiangsu Province. ESR C-REIT promises annualised cash distributions of 4.5% for 2024 and 4.62% for 2025, attracting investors seeking stable returns. The listing is expected to inject approximately INR 356 million into ESR Group, supporting potential expansions in China's lucrative logistics sector. This strategic move underscores growing investor interest in REITs and positions ESR Group for robust growth and collaboration opportunities in the Chinese market.
Investors seeking stable returns in China's booming logistics sector have a new opportunity. ESR Group, a leading real estate asset manager, has secured approval from Chinese authorities to list its logistics real estate arm as a REIT (Real Estate Investment Trust) on the Shanghai Stock Exchange.
This REIT, named ESR C-REIT, is a "publicly offered infrastructure securities investment fund." In simpler terms, it allows investors to pool their money and invest in income-generating logistics facilities. Initially, ESR C-REIT will focus on three high-quality logistics facilities situated in Kunshan, Jiangsu Province, China. These facilities are currently owned and managed by ESR Group, but after the listing, a subsidiary will continue to manage them for the benefit of the REIT.
The ESR C-REIT listing is expected to be a win-win for both investors and ESR Group. Investors can expect steady returns through projected annualised cash distributions of 4.5% for 2024 and 4.62% for 2025. ESR Group, on the other hand, will gain access to fresh capital of approximately INR 356 million (based on current exchange rates) to potentially expand its logistics portfolio in China. The final price per unit of the REIT offering hasn't been disclosed yet.
Stuart Gibson, co-founder and co-CEO of ESR Group, expressed confidence that the listing of their portfolio would serve as a catalyst for future growth in China. He emphasised that this move would establish a solid foundation for ESR Group to expand the C-REIT and foster more collaborations with domestic financial institutions and investors in China.
The ESR C-REIT listing is another indicator of the growing popularity of REITs in China. REITs provide a way for investors to participate in the real estate market without directly purchasing and managing properties. This can be particularly attractive for specialised sectors like logistics facilities, which require specific expertise.
Advertisement
Facebook
Whatsapp
