Disappointing returns cool China’s infrastructure Reit craze

THE boom in China’s fledgling market for publicly offered infrastructure-focused real estate investment trusts (Reits) appears to be faltering, as bets on short-term high returns fail to pay off.

The CSI Reits (closing) Index, which measures the overall performance of such Reits traded on the Shanghai and Shenzhen stock exchanges, plunged from this year’s high of 1,069.48 on Feb 14 to a historical low of 932.6 on May 26, losing 13 per cent.

In addition, the total market capitalisation of China’s 27 publicly offered infrastructure-focused Reits slumped to 90.6 billion yuan (S$17.3 billion) on Apr 27, below their combined debut value of 91.5 billion yuan.