China greenlights first housing rental quasi-REIT

China recently gave the green light to a new financing product that is based on rental income from apartments in major cities.

The new product is modeled on the lines of quasi-Real Estate Investment Trusts (REIT) which are allowed to use securitization techniques to monetize assets and access funding. It would also signal yet another step by China to further develop its real estate market.

China Young Professional Apartments, a Beijing-based condominium manager backed by Chinese venture fund SAIF Partners, got the necessary approval from the Shenzhen Stock Exchange to offer 270 million yuan ($40.77 million) of asset-backed securities to retail investors.