GRA Market Weekly (2026-07-18)

Policy Watch

MOFCOM and eight other ministries back ABS and REITs issuance by retail operators

Nine ministries jointly issued the Opinions on Accelerating Innovative Development of the Retail Sector, explicitly supporting eligible retail operators in issuing ABS and commercial real estate REITs, and supporting consumer infrastructure projects - department stores, shopping centres, community retail and wet markets - in issuing infrastructure REITs. By expanding the eligible underlying asset classes for consumer infrastructure REITs at the top-design level, the policy is expected to accelerate quality retail properties into the REITs issuance pipeline. With more than 20 commercial real estate REITs currently under review and cumulative target proceeds exceeding RMB 75 bn, the policy will further enlarge the pool of securitisable assets.

Market Watch

Chengdu Wuhou residential plot clears at an 18.5% premium after a six-developer contest

Two residential plots in Chengdu's Wuhou District went to auction. The core plot drew six developers including Xiamen ITG, Poly, C&D, China Overseas and Greentown; after 38 rounds, a Xiamen ITG subsidiary won at an accommodation value of RMB 23,700/sqm, for a total of RMB 790 m at an 18.5% premium. The same day, two plots in Jinniu District went to Bangtai at a combined reserve price of RMB 786 m, with total GFA of c. 56,900 sqm. Chengdu ranked first nationwide in new-home sales in H1 (31,936 units); prime plots in core districts still command scarcity premiums, but far-suburban plots clear at reserve or fail outright - the hot-cold divergence within the city persists.

Greentown wins Changgouhe Plot 1 in Wujin at RMB 12,073/sqm accommodation value

On 12 July, after 98 rounds of bidding, Changgouhe Plot 1 was successfully granted to Changzhou Gangxin Real Estate Co., Ltd. (Greentown) for a total of RMB 587.66 m, at an accommodation value of RMB 12,073/sqm and a 19.8% premium. Located north of Renmin Middle Road and east of Xiyuan Road in Hutang Town, the plot covers 47,957 sqm with a plot ratio of just 1.015 and a 40-metre height limit - the lowest-density residential land granted in central Changzhou since 2017, with scarcity value fully on display.

First central-SOE commercial real estate REIT - ChinaAMC Poly Commercial REIT launches, with retail subscriptions oversubscribed

ChinaAMC Poly Commercial REIT (508605) formally launched on 15 July, the first approved central-SOE commercial real estate listed REIT. Its underlying assets are the Poly Center in Guangzhou's Zhujiang New Town (premium Grade A office, 82,000 sqm) and Poly Water City Time Vista by Qiandeng Lake in Foshan (shopping centre, 153,000 sqm, 92.74% occupancy). Priced at RMB 3.593 per unit with 500 m units on offer, the target raise is RMB 1.797 bn at a projected distribution yield of c. 5.99%-6.01%. Institutional (offline) subscriptions covered only 1.00x, anchoring pricing at the bottom of the enquiry range; but public investors oversubscribed, triggering early closure on 15 July itself. In the same period, all first-batch CSI REITs index funds completed fundraising, bringing c. RMB 1.2 bn in incremental capital. Restrictions on insurance capital investing in commercial real estate REITs will formally lift in August. The market is shifting from IPO-punt dynamics to value investing grounded in asset quality and distribution yields; cautious institutions alongside oversubscribed retail suggest allocation-driven capital is entering as pricing rationalises. The August lifting of the insurance-capital restriction could be the market's key catalyst.

China's first green affordable rental housing quasi-REIT lists

The Hua An Asset - Guotai Haitong - Pudong Development Group Huizhi Affordable Rental Housing Green Asset-Backed Plan listed on the Shanghai Stock Exchange on 9 July - the nation's first green affordable rental housing quasi-REIT and Shanghai's largest quasi-REIT. Total issuance was RMB 3.650 bn with a senior-tranche coupon of just 1.95% (a record low for quasi-REITs of comparable size) and a subscription ratio of 3.32x. The underlying assets are the Huizhi Renhengpai, Huizhi Youchao and Huizhi Fanghua rental housing projects, all in core Pudong and built to green building standards.

Project Watch

Phase II of Shanghai's Hongqiao Alibaba Center plans an office-to-rental conversion, with 275 long-term rental apartments

Around 9,000 sqm of idle office space in Phase II of the Hongqiao Alibaba Center is slated for conversion into long-term rental apartments - 275 affordable rental units aimed at young people - currently at the scheme-preparation stage. The project previously converted 5,219 sqm of podium space into a 92-room upper-midscale hotel (the Jianguo Puyin Hotel), which since opening in November 2024 has run above 80% occupancy outside exhibition periods, lifting overall campus occupancy from 60% to 80%. The policy basis is Shanghai's July 2025 Implementation Opinions on Promoting the Renewal and Upgrading of Commercial Buildings, which expressly allows existing commercial-office stock to accommodate rental housing and talent apartments.

DBS Bank Tower in Lujiazui trades: Pinduoduo pays RMB 3.37 bn in full cash

Shanghai's property market has seen another blockbuster en-bloc transaction: leading internet company Pinduoduo completed a major asset acquisition, taking the landmark DBS Bank Tower in core Lujiazui for RMB 3.37 bn in full cash - a record for Shanghai's commercial-office market this year. The property sits at the heart of Lujiazui, Pudong, near Lujiazui Station on Metro Line 2, surrounded by Huiya Tower, Foxconn Tower, Bank of Shanghai Tower, Times Finance Center and Bank of China Tower. On current occupancy, building staff told Jiemian News that "some e-commerce tenants have already moved in"; DBS Bank staff also confirmed to reporters that they are aware of Pinduoduo's acquisition but no relocation date has been set. Yan Yuejin, deputy head of the E-house Shanghai Real Estate Research Institute, said a RMB 3.3 bn-plus whole-building acquisition in core Lujiazui carries unmistakable signal value, reflecting leading companies' recognition of Shanghai's long-term value as an international financial and consumption centre.

Bao'an's largest non-residential-to-affordable-rental conversion signed

On 16 July, Shenzhen Xinqiao Huangpu Joint-Stock Cooperative Company, Shenzhen Zengshi Brothers Property Management Co., Ltd. and Shanghai Construction Group formally signed the cooperation agreement for the Yanlord Binfenhui Tower B non-residential-to-affordable-rental conversion - marking the start of construction on Bao'an District's largest such project to date. The conversion covers floors 4 to 32 of Yanlord Binfenhui Tower B - 27 floors of formerly idle office space with total GFA of 34,890.49 sqm. Once converted, the project is expected to deliver 597 affordable rental units across two sizes and four layouts: 496 units of 50 sqm (two-bed and three-bed) and 101 units of 100 sqm (three-bed and four-bed), housing c. 1,500 people. The project adjoins Xinqiao East Industrial Park - Shenzhen's first square-kilometre-scale industrial-to-industrial urban renewal project and among the first "industry upstairs" demonstration parks. Preliminary canvassing found 611 prospective residents across 27 nearby above-scale, national high-tech and specialised SME enterprises.

Corporate Watch

Dajia P&C lists two Shenzhen Nanshan commercial properties, with an estimated value near RMB 3 bn

Dajia Property & Casualty Insurance has listed for transfer, via the Shanghai United Assets and Equity Exchange, Plot C11 of Fortune Financial Building in Nanshan District, Shenzhen (a dedicated headquarters office tower for industry leaders) and Plot D06 (four standalone commercial buildings), with an estimated total value approaching RMB 3 bn. Within a 5 km radius sit Tencent, the Alibaba Center and Baidu's Greater Bay Area headquarters, among other leading companies. "The main tower will be priced at around RMB 2 bn, and the four standalone buildings at RMB 200 m each," a person familiar with the matter said, adding that the process remains at the pre-disclosure stage of soliciting prospective investors, with the reserve price subject to formal disclosure.

Taikang registers twin funds on the same day, with combined registered scale of RMB 4 bn

On 10 July, the Taikang Jiafeng Fund of Funds and the Taikang Jiafeng Industry Consolidation Fund, both initiated by Beijing Taikang Investment Management Co., Ltd., completed AMAC filing on the same day, with combined registered scale of RMB 4 bn at the Insurance Asset Management Association of China. Coinciding with Taikang Insurance Group's 30th anniversary and Taikang Asset's 20th, the two new funds mark Beijing Taikang Investment leveraging the long-term capital nature of insurance money to further expand multi-strategy equity allocation. The second-vintage fund of funds targets hard tech and healthcare; the industry consolidation fund partners with industry-chain leaders and top buyout funds to invest in healthcare and technology supply-chain consolidation and mature-business buyout opportunities.

Insurers adopt a "joint LP + dual GP" structure to take over Zhongguancun landmark Dinghao DH3

AIA Life, Dajia Life, Manulife-Sinochem and Wuxi Cheng'an Dingrui have jointly come in as LPs, with two specialist institutions as GPs, taking over the Zhongguancun landmark Dinghao DH3 (formerly Dinghao Building) through a RMB 6.1 bn fund. The investment approach shifts from direct investment by a single insurer to a new "joint funding + professional fiduciary management" model.

Overseas Watch

GLP J-REIT acquires three Japanese logistics assets for JPY 40.7 bn

On 15 July, GLP J-REIT (TSE:3281) agreed to acquire trust beneficiary interests in three logistics assets in Japan for a total of JPY 40.7 bn (c. RMB 1.954 bn at JPY 1 ≈ RMB 0.048). Japanese logistics REITs continue to expand, reflecting institutional investors' sustained conviction in rent growth and demand resilience for Japanese logistics assets. The same day, Comforia Residential REIT announced the acquisition of five rental residential properties in Greater Tokyo for c. JPY 10.263 bn, while Lendlease and PGGM announced the Japan Modernisation Partnership, with investment capacity of up to JPY 120 bn (c. RMB 5.76 bn) focused on logistics and office assets in Greater Tokyo and Greater Osaka. In a low-rate environment, Japan's real estate market continues to attract domestic and foreign capital, with logistics and multifamily the most favoured segments.