China Railway Corp. (CRC) is weighing whether to create a real estate investment company to bring 18 proposed mega rail-property projects under one corporate umbrella as it seeks to increase funding, Economic Information Daily reported Monday.
CRC has long-term plans to build rail-linked property projects and the State Council is understood to approved the necessary policies to get them rolling. An announcement could be made as soon as the end of this month, the report said.
The corporation is under growing pressure to raise funds for railway construction, with its outlays for this year to grow from an initial projection of 700 billion yuan to revised estimates of over 800 billion yuan, covering a total of 64 projects.
The new rail development fund is expected to provide less than 500 billion yuan (US$80.2652 billion) per year for 2015 and 2016, while national subsidies are expected to be under 100 billion yuan a year.
The State Council is on the record as favoring an integrated approach combining railway and property investment along the lines of the MTR Corp.’s rail-plus-property model.
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