China Overseas Development (00688) has taken a major step toward listing a real estate investment trust backed by a shopping center in Foshan, with plans to hold roughly one-fifth of the fund units.

On September 7, 2026, China Asset Management and CITIC Securities submitted registration and listing applications for the public fund to the China Securities Regulatory Commission and the Shenzhen Stock Exchange. Prior to the proposed listing, the company had already filed an application under Practice Note 15 with the Stock Exchange of Hong Kong, along with a request for a waiver from strict compliance with paragraph 3(f) of that note regarding the assured entitlement requirement.

The REIT's underlying asset is a shopping mall located in Nanhai District, Foshan, Guangdong Province—the Foshan Qiandeng Lake Huan Yu City project—which is owned by a project company. As of the announcement date, the project company is a wholly-owned subsidiary of China Overseas Urban Development, which is itself an indirect wholly-owned subsidiary of the company.

For the proposed spin-off, China Asset Management, acting as the public fund manager, will establish the public fund as a publicly listed real estate securities investment fund, taking responsibility for its management and administrative operations. At present, the public fund is expected to raise total proceeds of approximately RMB 1.534 billion.

At the time of the proposed listing, the group will subscribe for about 20% of the total issued fund units. In accordance with applicable Chinese laws and regulations, the asset-backed special plan will be established by its manager as part of the proposed spin-off.

Upon the establishment of the public fund, the fund will use its proceeds to subscribe for all interests in the asset-backed special plan. Subsequently, the special plan will apply the subscription proceeds to acquire the entire equity interest in the project company from the group, repay the project company's debts, supplement working capital, pay related transaction taxes and fees, and cover the establishment and transaction costs of the public fund and the special plan.

Following the completion of the acquisition, the project company will be wholly owned by the REIT and will cease to be a subsidiary of the company. After the proposed spin-off, the REIT will not become a subsidiary of the company, nor will it be consolidated into the company's financial statements.