VNET Pioneers Green Asset-Backed Security in China's IDC Market

On November 4, 2025, VNET Group, Inc. (NASDAQ: VNET), a leading provider of neutral internet data center services in China, announced a major advancement in the integration of sustainability into finance via its launch of a holding-type real estate green asset-backed security. This step, part of their Private REIT Project, represents a first for China’s IDC sector, combining asset securitization with eco-friendly objectives.

The Private REIT will officially be listed on the Shanghai Stock Exchange, serving as a standardized financial product aimed at enhancing capital flows into sustainable developments. By revitalizing existing IDC assets through this innovative financial vehicle, VNET aims to efficiently recycle capital while also reducing its leverage ratio and optimizing its capital structure for better financial health.

Under this new initiative, VNET will transfer 100% equity interest of one of its retail IDC projects into the REIT, with estimates pointing to an offering size of approximately RMB 860 million. Notably, 93% of the REIT will be subscribed by major domestic institutional investors, including the prominent China Pacific Insurance (Group) Co., Ltd. (CPIC), with VNET itself securing the remaining 7% stake. The extensive valuation puts the equity consideration at approximately RMB 800 million, translating to a 13x EV/EBITDA.

This new securitization project is significant as VNET takes on the role of issuer and originator, ensuring the ongoing operation and management of the underlying IDC asset. This will aid in the establishment of a sustainable and thriving environment for its operations, crucial in maintaining a healthy long-term development trajectory.

Third-party evaluations have recognized the Private REIT Project with a prestigious G-1 rating. This indicates that the project’s proceeds are being effectively used towards environmental goals, signaling an exceptionally strong likelihood of achieving the desired sustainability outcomes. This accolade not only reflects VNET's commitment to sustainable business practices but also underscores its market leadership.

Josh Sheng Chen, the founder and Executive Chairperson of VNET, expressed his enthusiasm, stating, "We are thrilled to pioneer the use of holding-type real estate green asset-backed securities in China's IDC industry. Our Private REIT Project represents a major breakthrough in green finance and asset securitization innovation that will enable VNET to set new benchmarks for high-quality, sustainable IDC development."

Demand for IDC services is on the rise, particularly in tier-one cities where VNET's premium retail IDC project is based. The company’s state-of-the-art infrastructure supports swift data transmission and low latency, catering to a loyal clientele, including financial institutions and established internet companies, thus ensuring consistent cash flow.

Looking ahead, VNET anticipates initiating additional capital recycling projects and emphasizes the creation of enduring value for all stakeholders involved in the venture. This strategic maneuver positions VNET not just as a service provider but as a leader in the journey toward a more sustainable future in the tech industry.

In summary, VNET's Private REIT Project serves as an exemplary model of how green finance can be integrated into traditional business structures, marking a pivotal moment for the IDC sector in China and inspiring other firms to follow suit in the era of environmental consciousness. VNET's commitment to promoting industry-wide advancements underlines the importance of sustainable development in technology sectors.