Despite a brief lull, Chinese interest in U.S. commercial real estate is still strong, according to Thor Equities CEO Joseph Sitt.
“We saw a slowdown about six months ago, when China went through that little bump in the road, but now I am starting to see it going reverse,” he told Bloomberg in a TV interview Monday. But while investor interest is back, Chinese savers are now looking increasingly for stable assets, Sitt claimed. “People aren’t looking as much for development risk.”
At the beginning of the year, Chinese investment in New York showed signs if drying up amid weak economic data and exchange rate volatility. In late January Related Companies CEO Jeff Blau said that U.S. real estate companies “should be looking for other sources of capital over the next few years.”
But recently, Chinese investors had a hand in high-profile New York real estate deals. On Monday, news broke that developer Xinyuan Real Estate paid $66 million for a large Flushing development site with plans to build a 269-unit condominium property. Meanwhile, property records indicate Extell Development [TRDataCustom] landed Chinese investment firm Shanghai Municipal Investment (SMI) as an equity partner for its Central Park Tower project.
According to Sitt, uncertainty over the November presidential elections does little to deter foreign investors – largely because other regions look even more unstable in the wake of the Brexit vote.
“All of a sudden America is starting to look like the least risky of all of those crazy environments,” he said. [Bloomberg] – Konrad Putzier