According to a report by CRIC, real estate policies maintained a supportive stance in 2025, with infrastructure REITs advancing steadily. However, financing for property developers continued to shrink, with total annual financing reaching 414.3 billion yuan, a decline of 26% year-on-year. In the fourth quarter alone, financing amounted to 102.3 billion yuan, down 14% from the previous quarter and also 14% lower than the same period last year, remaining at historically low levels. Looking ahead to 2026, CRIC expects debt repayment pressures on developers to ease, with public REITs aiding the transition from heavy to light asset structures. In terms of bond financing costs, the average overseas bond financing cost for developers in 2025 was 6.21%. For instance, in February 2025, GREENTOWN CHINA (03900) issued $350 million in senior notes maturing in 2028 with a coupon rate as high as 8.45%. In June, another developer issued $300 million in offshore bonds with an interest rate of 11.88%. In contrast, Yuexiu issued offshore senior notes at a cost of just 3.3% in late October, while China Resources issued two offshore bonds in November with costs of 2.4% and 4.125%, respectively. Currently, only a very small number of developers are issuing bonds overseas, but financing costs show significant divergence. Domestically, the average bond financing cost for major developers fell further to 2.55% in 2025, down 0.36 percentage points from 2024. This decline is attributed to the accommodative monetary environment since 2024, with the Loan Prime Rate (LPR) continuously being lowered, as well as the fact that most bond issuers are state-owned enterprises, central government-owned enterprises, or high-quality private firms with stronger financing advantages, such as China Resources Land, Poly Development, and China Merchants Shekou. The overall average cost of new bond financing in 2025 stood at 2.89%. Additionally, domestic debt financing accounted for 68% of the total, while offshore debt financing rose to 15%. State-owned and central enterprises still represented 87% of new financing, and financing costs continued to vary widely among different types of firms. Nearly 20 developers underwent full or partial debt restructuring, though a return to normal operations will take time. Looking forward to 2026, debt repayment pressures are expected to ease as bond issuance by developers has declined significantly in recent years, leading to a notable reduction in maturing debt. Total maturing debt in 2026 is estimated at about 403.8 billion yuan, with approximately 129.8 billion yuan due in the first quarter and 118 billion yuan in the third quarter, marking the peak periods for the year. It is worth noting that the active promotion of public REITs in China in recent years helps developers unlock capital tied up in self-held properties, which can be used for debt repayment and working capital. Many developers have already begun piloting public REITs or are actively preparing for issuance. Based on statements in interim results announcements and annual financial reports, developers such as China Resources Land, China Merchants Shekou, and Seazen Holdings have explicitly expressed intentions to expand their REITs scale in the future. The real estate sector remains in a phase of deep adjustment, where the traditional heavy-asset model is no longer suited to the current environment. Public REITs enable developers to transition from being pure developers to operators, establishing an end-to-end business model of "investment, financing, management, and exit," thereby facilitating a shift from heavy to light asset structures.