REITs

A joint study titled Organizing REITs in Asia by CIEL Deputy Director Yueh-Ping Yang, Professor Kelvin F. K. Low of the University of Hong Kong, Professor Jianbo Lou of Peking University, and Associate Professor Mutsuhiko Yukioka of the University of Tokyo is now available on SSRN. The chapter will appear in the forthcoming edited volume Asia-Pacific Trusts Law, Volume 4: Connections in Context, co-edited by Professor Ying Khai Liew of the University of Melbourne and Associate Professor Yang.

Adopting a comparative law perspective, the study examines Real Estate Investment Trust (REITs) regimes across five major Asian jurisdictions—Japan, Singapore, Hong Kong, Taiwan, and China. The analysis focuses on two key issues: first, the organizational structures of REITs in these jurisdictions, including whether they adopt trust-based structures and how different institutional designs influence market development; and second, the regulatory and legal challenges associated with different organizational arrangements.

The study finds that significant differences exist in the organizational forms of REITs across Asia. Japan, the most mature REIT market in the region, structures its J-REITs as investment corporations rather than trust-based vehicles. In contrast, Hong Kong and Singapore primarily operate REITs through unit trusts structures, although differences in tax design and market structure have led to distinct developmental paths. Meanwhile, Taiwan and China place trust structures at the core of their REIT frameworks. China has rapidly expanded its infrastructure REIT market through multi-layered structures, whereas Taiwan’s REIT market has remained relatively limited due to legal design and regulatory constraints.

Overall, the study suggests that there is no single optimal legal structure for REITs. Institutional arrangements are shaped by each jurisdiction’s tax regime, corporate and trust law frameworks, as well as its financial regulatory environment. Through cross-jurisdictional comparison, the research further highlights the diverse developmental pathways of REIT markets in Asia and sheds light on the processes of institutional transplantation and legal adaptation.

📖 Full article:https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6332318