Hong Kong Exchange-listed ESR Group continues to plan for a listing on the Shanghai Stock Exchange of a C-REIT with three modern logistics projects in Kunshan, a satellite town of Shanghai. ESR has submitted an application to the China Securities Regulatory Commission (CSRC) for the listing via a publicly offered infrastructure securities investment fund (C-REIT).
The ESR C-REIT will focus on New Economy logistics, e-commerce and high-tech industrial manufacturing assets in Greater China, all of which are backed by strong secular growth trends.
The initial “seed” portfolio assets have the “best-in-class” specifications, an ESR press release says. The three properties are Jiangsu Friend Phase 1, Jiangsu Friend Phase II and Jiangsu Friend Phase III.
Phase III is the largest in terms of GFA with more than 206,000 sq m. The three assets have been built since 2018 with over 95% occupancy rate for the past four years, anchored by MNC brands from sectors such as logistics, e-commerce to fast-moving consumer goods.
Interestingly, Shanghai Metro Line 11 connects Kunshan with Shanghai's Jiading district and then continues southeast to pass through the city's Putuo, Xuhui and Pudong districts to end at Shanghai Disney Station.
The ESR C-REIT is expected to raise approximately RMB2.88 billion. Starting from 2024, the annualised cash distribution rates are estimated to be around 4.4% and 4.5%.
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Based on mainland China fund guidelines, securities companies, fund management companies, trust companies, trust companies, financial companies, insurance companies, qualified foreign institutional investors (QFII), commercial banks and their wealth management subsidiaries, qualified private equity fund managers, other professional institutional investors recognised by the CSRC, and security funds, such as the National Social Security Fund, basic pension insurance funds and annuity funds can invest in C-REIT.
