Core Viewpoint - The article emphasizes the strategic importance of optimizing infrastructure through the development of public REITs in China, which are seen as a key mechanism for activating existing assets and facilitating capital circulation, thereby supporting high-quality economic development [1][7]. Group 1: Market Development and Scale - As of November 27, 2025, China's public REITs market has reached 77 products with a total issuance scale exceeding 200 billion yuan, and a total market capitalization of over 220 billion yuan [2]. - The REITs model has proven feasible in China, contributing to the establishment of a mature institutional and ecological foundation for commercial real estate, with expectations to drive over 1 trillion yuan in new investments [2][3]. - The asset structure of REITs has diversified beyond early single-asset limitations, now including various sectors such as consumer infrastructure, clean energy, and affordable housing [2]. Group 2: Policy Support and Expansion - In November 2025, the National Development and Reform Commission expanded the scope of REITs to cover 15 major industries, including commercial office facilities and urban renewal projects [3]. - The policy framework aims to create a comprehensive support system for REITs across all infrastructure sectors, aligning with the goals of revitalizing existing assets and optimizing resource allocation [3]. Group 3: Advantages of Public REITs - Public REITs offer significant institutional advantages over traditional financing tools like CMBS, allowing investors to hold direct equity in underlying assets and benefit from both operational cash flow and asset appreciation [4]. - The long-term nature of REITs, with a potential lifespan of up to 40 years, aligns well with the long-term characteristics of infrastructure assets, addressing the challenges of high investment costs and lengthy recovery periods [4]. Group 4: Capital Flow and Market Dynamics - REITs serve as a "converter" of capital flow, effectively connecting the supply and demand sides of funding, with a mandatory dividend distribution mechanism that attracts long-term capital from sources like social security and insurance funds [5]. - The market-driven selection mechanism of REITs encourages infrastructure companies to shift focus from construction to operational efficiency, enhancing asset utilization rates [5]. Group 5: Inclusivity and Accessibility - REITs are reshaping the investment landscape by lowering entry barriers for individual investors, allowing them to participate in infrastructure investments with minimal capital [6]. - The expansion policies have amplified market effects, creating a closed-loop system of issuance, investment, and reinvestment, exemplified by successful fundraising for affordable housing projects [6]. Group 6: Challenges and Future Directions - The REITs market faces challenges such as an incomplete valuation system, unclear tax incentives for asset transfers, and insufficient market liquidity, which could hinder its effectiveness in capital allocation [6]. - To promote high-quality development of the REITs market, collaboration among government, enterprises, and the market is essential, including the establishment of unified valuation guidelines and improved regulatory frameworks [7].