China plans to let funds, brokerages launch REITs-sources

Published: 26 Aug 2009 23:25:58 PST

SHANGHAI, Aug 27 - China plans to allow fund houses and brokerages to launch real estate investment trusts, or REITs, that would be publicly traded on the Shanghai and Shenzhen stock exchanges, two people with direct knowledge of the proposal said.

REITs should be launched in the form of closed-end funds via special asset management firms, in which property developers can also own a stake, according to draft rules issued by The China Securities Regulatory Commission for consultation, the people said.

The draft rules are subject to changes and it is not clear when they will be officially published.

China's bourses are competing with the country's interbank market in launching China's first REITs as soon as this year, as Beijing accelerates financial reforms to support a slowing economy and the property market.