Here’s how Chinese real estate investors and NYC broke up

The retreat was largely due to domestic issues within China

New York /
Jun.June 27, 2019 12:00 PM
(Credit: iStock)

(Credit: iStock)

Chinese companies were paying record-breaking sums for Manhattan trophy buildings not too long ago. They have since retreated from the city’s property scene, largely due to issues within their own country.

The Chinese government imposed strict controls to limit overseas property deals amid concerns about a slowdown in the country’s own economy, according to the Financial Times.

This has affected not only the New York market but also cities like London and Vancouver. A recent Cushman & Wakefield report found that the properties they had put up for sale were worth about $12 billion overall.

But the trend is most pronounced in New York, where developers of luxury towers are dealing with more vacant units because they can no longer count on aggressive Chinese buyers. This is a marked contrast to 2015, when Chinese buyers poured $5.4 billion into New York properties, a number that then jumped to $8.8 billion in 2016.

But Beijing started tightening controls on overseas investments in late 2016, and when Xi Jinping was reelected to another five year term in 2017, the government promised to rein in lending that has helped companies like Anbang make several splashy overseas purchases.

By 2018, Chinese investment in New York had dropped to $336 million, and the country now falls behind the Canadians, the Germans and the Dutch in terms of foreign investors in the city.

Firms are also looking to sell their overseas properties to acquire cash as the Chinese government cracks down on shadow banking and outbound investments.

Some Chinese deals in New York still seem solid, including Fosun International’s $725 million purchase of One Chase Manhattan Plaza in 2013, which it rebranded as 28 Liberty. [FT] — Eddie Small


Related Articles

arrow_forward_ios
Ken TaeHern Kim, Zhongyuan Li and the Hyatt Regency Waikiki Beach (Linkedin, Google Maps)

Allegations fly in trial over Anbang and Mirae’s $5.8B hotel deal

Allegations fly in trial over Anbang and Mirae’s $5.8B hotel deal
Anbang’s Andrew Miller, Mirae’s Peter Lee and (from left) JW Marriott Essex House, the Westin St. Francis in San Francisco and the Four Seasons in Jackson Hole (Credit: Marriott, Westin, Four Seasons)

Buyer’s remorse?: How Anbang’s $5.8B hotel deal went sideways

Buyer’s remorse?: How Anbang’s $5.8B hotel deal went sideways
Clockwise from the top left: JW Marriott Essex House in New York, the Four Seasons in Jackson Hole and the Westin St. Francis in San Francisco with Daija CEO Andrew Miller (Credit: MusikAnimal via Wikipedia; Jackson Hole Real Estate; Booking)

Anbang’s $5.8B hotel portfolio sale scrapped

Anbang’s $5.8B hotel portfolio sale scrapped
CEO Andrew Miller and clockwise from top left: JW Marriott Essex House in New York, the Westin St. Francis in San Francisco and the Four Seasons in Jackson Hole

Coronavirus threat could help sink Anbang’s $5.8B hotels deal: report

Coronavirus threat could help sink Anbang’s $5.8B hotels deal: report
Waldorf Astoria - Crown on Park Avenue

Condo sales launch at Waldorf Astoria in crowded luxury market

Condo sales launch at Waldorf Astoria in crowded luxury market
Renderings of Waldorf Astoria

Inside the Waldorf Astoria’s condo conversion

Inside the Waldorf Astoria’s condo conversion
Bizarre case of deed fraud complicated Anbang’s $5.8B hotel portfolio deal

Bizarre case of deed fraud complicated Anbang’s $5.8B hotel portfolio deal

Bizarre case of deed fraud complicated Anbang’s $5.8B hotel portfolio deal
Anbang’s multibillion-dollar US luxury hotel portfolio may have buyer: report

Anbang’s multibillion-dollar US luxury hotel portfolio may have buyer: report

Anbang’s multibillion-dollar US luxury hotel portfolio may have buyer: report
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...