CHINA OVERSEAS(HK:00688) Haitong Securities International·2025-12-02 08:43Investment Rating - The report rates the investment in 华夏中海商业 REIT as positive, highlighting its strong operational resilience and stable growth potential [1]. Core Insights - 华夏中海商业 REIT is the first consumer REIT to adopt an acquisition and revitalization model, with underlying assets demonstrating robust operational performance [1]. - The project, 佛山映月湖环宇城, is strategically located in Guangdong Province, benefiting from significant population density and a lack of competing large commercial projects in the vicinity [1][2]. - The rental rate of the project has improved significantly, reaching approximately 97.92% as of March 31, 2025, with a compound annual growth rate of about 11% in sales from 2021 to 2024 [1][2]. Summary by Sections Fund Overview - 华夏中海商业 REIT was officially registered on September 22, 2025, with a total fund size of 300 million shares and an expected total fundraising of 1.5843 billion yuan [6][24]. - The fund is managed by 华夏基金管理有限公司, one of the largest fund management companies in China, with over 3 trillion yuan in assets under management [7][8]. Industry Situation - The consumer infrastructure sector, particularly shopping centers, is expected to benefit from government policies aimed at boosting consumption and investment during the "14th Five-Year Plan" period [26][27]. - The retail sector in China has shown resilience, with a total retail sales volume of 47.15 trillion yuan in 2023, reflecting a year-on-year growth of 7.22% [29]. Project Details - 佛山映月湖环宇城 has a total construction area of 153,478.85 square meters and is positioned as a key self-owned property under the management of 中海环宇商业发展 [36]. - The project has undergone significant operational upgrades since its acquisition in March 2020, leading to a substantial increase in occupancy rates and sales performance [36][38]. Financial Projections and Future Potential - The project plans to allocate 85% of net recovery funds towards investments in other infrastructure projects, indicating strong future growth potential [1][2]. - The management team has demonstrated a strong track record, with a compound annual growth rate of 22.3% in managed scale and 27.1% in operational revenue since 2020 [1][2].