Why China is Likely to Remain the Biggest Foreign Investor in US Real Estate

Chinese investors spent $110 billion on US residential and commercial real estate in the last five years; an amount expected to double by 2020. How can this pace continue?

Commercial Property Executive

China earned the title of Biggest Foreign Investor in U.S. Real Estate with investments totaling $110 billion between 2010 and 2015, according to a recent study by the Asia Society and Rosen Consulting Group.

Chinese investors bought $93 billion in residential real estate, with a spending growth rate of 20%, according to the report, Breaking Ground: Chinese Investment in U.S. Real Estate. Chinese investors also acquired $17 billion in commercial property, with half of all deals closed last year. The annual growth of commercial real estate acquisitions was 70%.

Chinese direct investments across existing U.S. commercial and residential real estate assets could total at least $218 billion, cumulatively, from 2016 through 2020, the report shows. Beyond 2020, Chinese investment in U.S. real estate could accelerate, thanks to a widening pool of Chinese investors.

“The pension funds haven’t started investing at all in the United States. All over the rest of the world they do. We expect that to happen,” Arthur Margon, a partner at RCG and one of the authors of the report, told Commercial Property Executive. “Another large source of capital is the Chinese version of the private equity funds. That’s also just starting in China.”

(more on Chinese investment in U.S. real estate . . . )

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