China Index Research Institute: The scale of bond financing in the real estate industry declined sharply from month to month in September, and it will take time for the favorable New Deal to be transmitted

The Zhitong Finance App learned that according to the China Index Research Institute, on August 28, the Securities Regulatory Commission issued documents to support reasonable financing for real estate development companies and support real estate development companies to issue corporate bonds and asset-backed securities (ABS). Judging from the scale of bond issuance in the real estate industry in September, it will take time for favorable policies to be transmitted. The focus of financing is shifting from the credit of the group entity to the project side, which requires more professional development and fine operation. In terms of financing, real estate companies need to cooperate closely with host banks, prepare capital advance plans, combine multiple financing instruments, and take the initiative to manage open market debt.

The scale of bond financing: It dropped sharply in September compared to the same period last month, and it will take time for favorable policies to be transmitted

On August 28, the Securities Regulatory Commission issued documents to support real estate corporate bond financing at three levels: one is to meet reasonable financing needs, improve audit efficiency, and cover state-owned and private housing enterprises. The capital raised to support the issuance of corporate bonds is mainly used for real estate projects that meet policy requirements. The scale of capital raised matches the capital required for the project, and the project development company responsible for implementation must meet regulatory requirements; second, the stock continues on a rolling basis to allow stock corporate bonds to be renewed on a rolling basis to ease the pressure of maturity and payment; the third is market-based credit enhancement to encourage professional institutions to pass in accordance with the principles of marketization and legalization Support housing enterprises in issuing bonds through guarantees and the creation of credit protection tools. This policy will help real estate companies mitigate the risk of capital continuity and reduce the risk of default during the financing model shift period, thereby improving the ability of housing enterprises to operate steadily.

The total amount of bond financing in the real estate industry in September 2026 was 26.51 billion yuan, down 56.0% year on year and 41.5% month on month. Looking at the financing structure, credit bond financing in the real estate industry was 16.42 billion yuan, down 54.8% year on year, down 42.8% month on month, accounting for 61.9%; ABS financing was 10.10 billion yuan, down 55.7% year on year, down 21.5% month on month, accounting for 38.1%. In September, bond financing in the real estate industry declined month-on-month, which may be affected by the following factors: First, it will take time for favorable policies to be transferred to the actual issuance amount; second, the issuance of bonds still needs to be supported by projects under construction, so new issuance is still limited by the overall investment capacity and development capacity of enterprises; third, the real estate industry is still undergoing an adjustment period, and some housing enterprises tend to prudently carry out asset-heavy investment business, which affects bond financing needs; Fourth, due to sales pressure on real estate companies, investors still have to recover their confidence in their investment.

Data source: WIND. The scope of statistics is “Real Estate Management and Development”, based on the release date, compiled comprehensively by the China Research Institute

Judging from the issuance structure, the issuers of credit bonds are mainly state-owned enterprises and local state-owned enterprises. In September, the share of central state-owned enterprises issued 81.8%, down from the previous year; the share of issuance by private enterprises and mixed ownership enterprises increased. In September 2026, private enterprise debt issuance was still at a low level. The number of private enterprises issuing bonds and mixed ownership enterprises was 4. Basically, they were large-scale enterprises that had not yet taken risks. Among them, Greentown and Excellent Commercial Management issued amounts of 1 billion yuan and 990 million yuan respectively. Yuexiu Real Estate issued the highest amount of credit bonds this month, reaching 2.1 billion yuan.

The total amount of bond financing in the real estate industry from January to September 2026 was 43.05 billion yuan, a year-on-year decrease of 2.7%. Looking at the financing structure, credit bond financing was 249.90 billion yuan, down 7.9% year on year; overseas bond financing was 20.90 billion yuan, up 204.1% year on year; ABS financing was 164.20 billion yuan, down 2.7% year on year.

Figure: Financing amount and growth rate from September 2025 to September 2026

ABS: CMBS/CMBN and REITs supported by underlying assets account for over 80%

The distribution scale of ABS was 10.10 billion yuan, a year-on-year decrease of 55.7% and a decrease of 21.5% month-on-month. Among them, REITs are the most widely issued asset securitization products, accounting for 46.5%; followed by CMBS/CMBN and guaranteed housing, accounting for 40.9% and 10.4% respectively, and supply chain ABS accounting for 2.2%. On August 28, the Securities Regulatory Commission issued a document supporting real estate development companies to issue commercial real estate mortgage-backed securities (CMBS) and real estate ABS based on real estate projects with steady operation and good cash returns. It is proposed to promote the high-quality development of real estate investment trusts (REITs). In September, CMBS/CMBN and REITs supported by underlying assets accounted for over 80% of the total amount issued by ABS.

Figure: ABS distribution structure in September 2026

In September, rental housing REITs continued to expand. Within the month, Cathay Pacific Haitong China Construction Rental Housing REIT was established, raising capital of 1,367.5 billion yuan. This is the first publicly funded REIT of the “China Construction Department” and another affordable rental housing product with a central enterprise background in the Shanghai Stock Exchange market. The underlying asset is a guaranteed housing project in the Songjiang district of Shanghai - China Construction Xingfu+ Apartment (Shanghai Songjiang Branch). The original shareholder was China Construction Capital (Shanghai), a subsidiary of China Construction, and the operation management agency was China Construction Dongfu.

On August 28, the Securities Regulatory Commission issued a document to revitalize existing assets, broaden equity financing channels for real estate development companies, etc., and support the issuance of REITs based on eligible projects such as rental housing and urban renewal, or the inclusion of listed REITs as expansion assets. Currently, commercial real estate REITs have been launched, promoting the public REITs market to form a “traditional infrastructure+commercial real estate” two-wheel drive development pattern, and cooperating with hold-type real estate ABS to form a multi-level REITs market. REITs form a positive cycle of high-quality credit, steady management, and fine operation, and continue to reinforce the corporate credit moat. Facing this opportunity, it is recommended that enterprises start from two aspects: develop enterprises to deal with standard REITs issuance standards, systematically sort out existing assets, and build high-quality asset pools with clear property rights, stable cash flow, and meet capital market requirements; at the same time, strengthen operating capabilities, improve rental rates and rent efficiency, and lay the foundation for higher issuance valuations and distribution rates in the future.

Overall, ABS product types are still mainly those supported by high-quality underlying assets. The ABS channel will always be open to companies with high-quality holding assets, which will force real estate companies to pay attention to the refined operation of existing assets.

Financing strategy under the New Deal: The focus of financing is shifting from the credit of the group entity to the project side. Professional development and fine operation are king

Under the “8.28 New Deal”, both project and group cash flow management logic need to be reshaped. Under the new model, project funds are closed and supervised, and repayments are strictly prohibited into special accounts, earmarked funds, and withdrawals before delivery. After the New Deal, housing enterprise operations entered a new stage of “high capital accumulation and slow cash return”. The use of own capital for a single project increased markedly, and the cycle was drastically lengthened, and the project was unable to transfuse blood to the group; conflicts over the mismatch of interest-bearing debt matrices at the group level were prominent, coordination and flexible allocation were limited, and the difficulty of managing headquarters liquidity became more difficult.

Table: Impact of the New Deal on project-level and group-level capital flows

Under the “8.28 New Deal”, the company's financing focus is shifting from group entity credit to the project side, tying debt repayment sources to specific projects, fixing the mismatch of “short-term debt and long-term investment” terms in the past. Policies such as the “white list” mechanism and public REITs are still being implemented at an accelerated pace. The core of the credit qualification criteria for housing enterprises will shift from “large-scale, low debt, and strong credit” subject credit to “high-quality project portfolios, steady cash flow, and healthy balance sheets”. This will force enterprises to pay attention to the comprehensive development and operation of individual projects. The policy proposes various supporting financing such as bonds, asset-backed securities, public REITs, and real estate investment trusts. Most of these channels also rely on high-quality projects. Therefore, professional development and fine operation are the foundation for real estate companies to obtain financial support.

Figure: Various financing instruments after the New Deal

First, work closely with host banks. Priority is given to major state-owned banks or joint stock banks with one-stop service capabilities for “development loans+supervisory accounts+mortgages”, and can seek to take the lead in forming syndicates to spread risks. The pace of mortgage repayment is managed in advance, and the host bank communicates with the host bank to ensure timely payment of mortgage loans, collection of full repayment amounts, and cancellation of supervisory limits as needed, and shorten the time for funds to settle in supervised accounts.

Second, pre-capital planning. Under the New Deal, the pre-sale threshold was raised to the peak of the main structure, and the issuance of individual mortgages was delayed until completion. The scale and cycle of a single project's own funds have increased markedly, and a full-cycle funding plan must be completed during the land acquisition phase. The financing period must be strictly matched with the project construction and sales cycle, making full use of policy dividends, such as pre-sale project development loans for up to 5 years and existing housing projects for up to 7 years. In principle, the first repayment of capital is arranged after completion and filing to avoid continuous pressure caused by “long-term use of short-term loans.”

Third, use a combination of diverse financing instruments. Flexible mix and match between debt classes (development loans, corporate bonds, CMBS/ABN, etc.), equity (equity financing, investment, cooperative development), and securitization tools (rental housing and commercial real estate REITs, real estate ABS) to actively connect with various policy channels to relieve phased financial pressure and optimize the overall financing structure and costs.

Fourth, take the initiative to manage open market debt. Continuously track the maturity and resale points of open bonds such as surviving corporate bonds, medium-term notes, CMBS, etc.; make full use of policy dividends such as the “rolling renewal of stock corporate bonds” of the New Deal to maintain the open market credit bottom line through new issuance, replacement, rollover restructuring, and debt settlement, etc., to maintain the open market credit bottom line, and avoid the chain impact of a single default triggering cross-default, downgrade ratings, and loss of refinancing functions.