CapitaRetail China Trust (CRCT), the first pure-play China retail real estate investment trust (REIT), listed on the Singapore Stock Exchange (SGX) on December 8, 2006. The REIT debuted with a strong showing; the stock was oversubscribed by more than 100 times, and at the end of its first trading day, closed 59% higher than the offering price. In 2006, continual strong economic growth and rapid urbanization in China gave rise to a burgeoning middle-class and correspondingly a growth spurt in China's retail market. The deregulation of China's retail market drew in a number of large foreign retailers, and consequently, led to increasing demands for quality retail space. At that time, China's double-digit growth rates and the promise of unlocking the spending potential of China's domestic market attracted many investors looking for investment opportunities in China.

In this case study, participants are provided the opportunity to deconstruct the deal structure of CRCT. What drives CRCT’s strong debut? Is it entirely attributable to strong investor interest in the China market at that time, or there are other contributing factors? Through this exercise, case users would better appreciate the factors contributing to CRCT’s strong performance on the SGX. Consequently, real estate companies with a portfolio of overseas properties could obtain insightful take-aways to apply in their own future listings on the SGX.

Key words: CapitaRetail China Trust (CRCT), real estate investment trust (REIT), listing, China, retail market, deal structure, overseas asset portfolio