Advised by King & Wood Mallesons (KWM), the GSUM First Seafront- Poly Real Estate Rental Housing No.1 Asset-backed Specific Plan (the “ABSP”) and series 1 of the ABSP were approved by Shanghai Stock Exchange. With registered general offering size of RMB 5 billion, the ABSP is sponsored by Poly Real Estate Group Co., Ltd. (Poly Real Estate). The launch of the ABSP opens up the exit channel for rental housing developers via REITs and establishes an integrated closed-loop business model for rental housing. It serves as an excellent example of rental housing asset securitization, and establishes a new "shelf offering" model for those ABS that features non-standardized underlying assets such as quasi-REIT. This is the first rental housing quasi-REIT by a real estate developer in China, and also the first quasi-REIT under "shelf offering" model in China.

In recent years, the central government of China issued multiple opinions on encouraging and promoting the development of rental housing market, and repeatedly called for the provision of financial support to rental housing market through the promotion of pilot projects of Real Estate Investment Trusts (REITs). With rental housing held by Poly Real Estate as the underlying assets, the ABSP adopted the shelf offering model which permits multiple offerings based on the same registration. The proportion of preferred and subordinated securities is 9:1, and the preferred securities of the series 1 product was rated AAA. As the first rental housing quasi-REIT underlined by rental housings of the real estate developer, the product serves as a good example of diversifying investment and financing models for rental housing, and resolutely implemented the strategic deployment in the work report delivered to the 19th National Congress of CPC , i.e. to " move faster to put in place a housing system that ensures supply through multiple sources, provides housing support through multiple channels, and encourages both housing purchase and renting. This will make us better placed to meet the housing needs of all of our people". Meanwhile, this is the first domestic quasi-REIT in the model of shelf offering, which could realize the expansion of offering to a certain extent. It explores new ideas to improve the effectiveness of issuing in a practical way under existing enterprise asset securitization supervision system, and laid a solid and practical foundation for the approaching public-offering REITs pilot projects.

Advising on the ABSP, KWM provides comprehensive and efficient legal services including, but not limited to, product design, due diligence, transaction document drafting, and communication with regulatory authorities. The project was led by partners Fang Rong and Yan Qiong.

Fang Rong commented, “We are honored to assist Poly Real Estate and GSUM with the completion of the first exemplary project. This is another milestone real estate backed securitization project advised by KWM, leveraging our leading professional strength and innovation, combined with the extensive practice experience and profound industry insights. In response to the trend of multi-level development of China's real estate market, we will continue providing top-notch legal services for more clients in securitization and real estate structured investment & financing to further the development of domestic real estate backed securitization market and practice.”