Chinese investors are paying eye-popping figures to buy up the London skyline

Chinese investment in London’s commercial real estate market has more than tripled since the Brexit vote last year, and most of it has come through Hong Kong.

Chinese investors spent $5.1 billion in London during the first six months of the year, the highest figure on record and already ahead of the roughly $3.5 billion spent in all of 2016, Reuters reported.

Hong Kong accounted for 92 percent of the Chinese investment, as investors like the Hong Kong food conglomerate Lee Kum Kee agreed to pay a record $1.7 billion for the Rafael Vinoly-designed “Walkie Talkie” office tower at 20 Fenchurch Street.

“Deals from mainland China already make up a smaller proportion of the activity from the region, with Hong Kong investors most active,” said Anthony Duggan, Knight Frank’s head of capital markets research. “We expect that Chinese investors will still look to make strategic real estate purchases that fit within their business plans.”

Hong Kong-based investors are more significant players in London, but there was tumult after three leaders of the democracy movement were jailed last week.

The sterling’s 12 percent drop against the dollar since the Brexit referendum, record-high property prices in Hong Kong and political concerns are driving investment in London.

“Cheaper money, the rule of law, cultural familiarity and a need to diversify out of a home market is what’s driving Hong Kong demand in the UK,” Cushman & Wakefield’s James Beckham said. [Reuters] – Rich Bockmann