Allocation ratio nearly half, insurance funds aggressively seek to profit from inter-institutional REITs

Under the background of low interest rates and an “asset shortage,” to effectively alleviate the pressure of asset-liability matching, every suitable asset becomes a target for insurance funds to compete for. On April 23, reporters learned from industry insiders that in recent years, with the accelerated issuance of holding-type real estate ABS (i.e., inter-institutional REITs), inter-institutional REITs have gradually gained more favor from insurance funds, with the allocation share of insurance funds in the inter-institutional REIT market approaching half, making them true “big buyers.” Industry experts believe that inter-institutional REITs have long investment horizons and can provide stable cash flows, which can effectively help insurance funds achieve asset-liability matching goals. Therefore, the participation and influence of insurance funds in the inter-institutional REIT market will continue to increase. However, inter-institutional REITs also face “growth pains”—such as immature market mechanisms, the need to boost trading activity, and the need to expand the investment community—these developmental shortcomings still need to be addressed. (Shanghai Securities Journal)