China retaliates against Dalian Wanda for overseas investments

Six deals said to have violated regulations on foreign spending

Jul.July 17, 2017 09:31 AM

Wang Jianlin

There are signs that the Chinese real estate spree in New York City could be over.

Chinese regulators plan to cut off funding on six investments made by Dalian Wanda Group, one of five big-ticket spenders that have come under increased scrutiny as the government clamps down on overseas investments.

The six deals were found to have violated regulatory restrictions on overseas investments, though the specific breaches were not immediately clear, Bloomberg reported. The moves by regulators include prohibiting banks from providing the company with financial support on the deals and banning Wanda from selling the assets to Chinese companies.

Wanda Group founder and billionaire Wang Jianlin, China’s largest real estate developer and second-wealthiest man, has announced more than $20 billion worth of deals since the beginning of 2016. The move by regulators represents an escalation in its crackdown on overseas spending.

“To investors, political risk is now the biggest concern when investing in Chinese companies,” said Castor Pang, head of research at the investment bank and advisory firm Core-Pacific Yamaichi HK. “Not only Wanda, every Chinese company won’t find it easy anymore to acquire assets overseas. Stabilizing the yuan is the top priority for Beijing now.”

Last month it was reported that Dalian Wanda Group had come under increased scrutiny from regulators along with Anbang Insurance Group, HNA Group, Fosun International and Rossoneri Sports Investment Management.

Four of Wanda’s six deals have already been completed, including the $9.3 billion sale of 89 hotel and tourism assets to Sunac China Holdings. [Bloomberg]Rich Bockmann

Related Articles

Brookfield Asset Management CEO Bruce Flatt

“We underwrite every investment like we’re going to hit a recession”: Brookfield CEO

Cadre founder Ryan Williams and Allen Smith

Cadre brings on former Four Seasons CEO as president

AKS Capital Partners Managing Partners Aaron Appel and Walker & Dunlop CEO Willy Walker

Walker & Dunlop acquires Aaron Appel’s AKS Capital Partners

From left: Publisher and founder Amir Korangy, Editor-in-chief Stuart Elliott and VP of Corporate Development Yoav Barilan

TRD’s founders share war stories from over the years

As the years go by_A look back at 17 years of real estate history

A look back at 17 years of real estate history

250th Issue

The Real Deal celebrates 250 issues

Neir’s Tavern (Credit: Google Maps)

City’s oldest bar, of “Goodfellas” fame, gets last-minute lifeline

Neir's Tavern (Credit: Google Maps)

Landlord to bar owner: You don’t have to go home but you can’t stay here