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Chinese Investment in U.S. Commercial Real Estate Is Plunging

Chinese investors put 76 percent less money into U.S. CRE year-to-date through September than in 2018.

(Bloomberg)—Chinese investment in U.S. commercial property is plunging as restrictions on capital leaving the country and geopolitical tensions weigh on real estate deals.

Chinese investors put $1.4 billion into U.S. commercial real estate in the 12 months through September, a 76% plunge from a year earlier, according to a report from Real Capital Analytics. Investment from Hong Kong was also down in the period.

Money Moves

“Chinese investors have become net sellers as authorities in China have restricted speculative outbound investment,” Jim Costello, senior vice president at Real Capital Analytics, wrote in the report.

In the 12 months through September, foreign investors were net sellers of U.S. commercial real estate, according to Real Capital Analytics. That’s after six consecutive years of gains in cross-border acquisitions.

While Chinese investors are avoiding U.S. deals, there was an uptick in capital from countries including Germany, Turkey and South Korea.

In September, China’s Anbang Insurance Group Co. agreed to sell a portfolio of luxury hotels in the U.S. to South Korea’s Mirae Asset Management Co. for $5.8 billion.

To contact the reporter on this story: Natalie Wong in Toronto at [email protected].

To contact the editors responsible for this story: Craig Giammona at [email protected]

Alan Mirabella

© 2019 Bloomberg L.P.

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