The Study of Chinese Real Estate Enterprises Issuing Perpetual Bonds Financing: Advantage and Risk


In recent years, with the regulation of national policy, Chinese real estate market has been rapidly cooling, and real estate enterprises also have difficulties in financing. Perpetual bonds as a historic mezzanine financial instrument abroad was formally introduced into China in 2013 and its own characteristics can satisfy the current needs of the real estate enterprises. This paper analyzes the plight of the real estate market and real estate financing under the current environment, discusses the issue of perpetual debt financing, and analyzes the advantages and risks of issuing perpetual bonds in multiple aspects.

Share and Cite:

Jin, Y. (2014) The Study of Chinese Real Estate Enterprises Issuing Perpetual Bonds Financing: Advantage and Risk. American Journal of Industrial and Business Management, 4, 709-715. doi: 10.4236/ajibm.2014.412076.

Conflicts of Interest

The authors declare no conflicts of interest.


[1] Liu, D.Z. (2013) Real Estate Corporate Finance: Business Matching, Financial Support and Policy-Speed. Zhongshan University Press, Beijing.
[2] Huang, Z.Z. and He, D.Y. (2009) China Real Estate Enterprise Financing Innovation, Mezzanine Financing. Journal of Shanghai Real Estate, 6, 20-25.
[3] Luo, Y., Chai, S.M. and Wei, Y.M. (2013) Overseas Perpetual Bonds Overview and Case Study. China Merchants Bank Bond Market Special Report, 4, 40-44.
[4] Zhang, J.J., Fan, J.J. and Yang, B. (2013) Sustainable Debt: The Overseas Experience and the Prospect of Domestic Study. Journal of Bonds, 11, 2-8.
[5] Hu, T. and Zhang, F.L. (2013) Perpetual Bond Crack for Real Estate Financing Problems: The Case of Agile. Real Estate Finance, 4, 344-351.
[6] Irving, F. (1930) The Theory of Interest. The Macmillan Company, New York.
[7] Van, H.J. (1965) Interest-Rate Rik and the Term Structure of Interest Rates. The Journal of Political Economy, 73, 344-351.
[8] Black, S. (1973) The Pricing of Options and Corporate Liabilities. Journal of Political Economy, 81, 637-654.
[9] Merton, R.C. (1974) Theory of Rational Option Pricing. Journal of Economics and Management Science, 4, 141-183.
[10] Duffie, S. (2003) Credit Risk: Pricing Measurement, and Management. Princeton University Press, New York.
[11] Liu, L.J., Wang, J. and He, Y.Y. (2013) The Analysis of the Current Situation and Prospects for Tourism Real Estate in China. Proceedings of 2nd International Conference on Science and Social Research, 371-374.

Copyright © 2023 by authors and Scientific Research Publishing Inc.

Creative Commons License

This work and the related PDF file are licensed under a Creative Commons Attribution 4.0 International License.