“Money poured from the sky”: where Chinese investors buy real estate
For the past seven years, China has been demonstrating continuous growth in overseas property investment. In 2017, the volume of investments in commercial and residential properties grew by 18% and amounted to 119.7 billion dollars, according to research data of the largest Chinese portal of foreign real estate Juwai. Most Chinese investments are distributed between North America, Europe and Asian countries.
The volume of investment in real estate – 39.7 billion dollars.
The United States is traditionally leading in terms of Chinese real estate investment. At the end of last year, investors from China spent $ 30.4 billion in the purchase of residential assets in the country, while the acquisition of commercial facilities brought US economy $ 9.3 billion.
The main interest for Chinese investors are at home, especially near schools and universities. The purchase of such real estate, including, allows you to participate in the program of issuing a residence permit with the prospect of obtaining citizenship.
Since 80% of US visas of type EB-5 (the program of permanent residence for investments of 500 thousand dollars in US commercial enterprises) issued from 2006 to 2017, were received by citizens of the PRC. It is curious that, on average, the Chinese spend 3.5 times more to buy a house than the Americans themselves: about $ 831 thousand.
Investments in commercial real estate in the past year have declined. One of the reasons is the strengthening of China’s control over the movement of capital from the end of 2016, as well as the fight against withdrawal of funds from the country.
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The volume of investment in real estate – 23.1 billion dollars.
Hong Kong, the largest financial center in the Asian region, has a special administrative status within the PRC. The region is among the priority areas for Chinese real estate investment relatively recently.
The breakthrough came in 2017, when investors from mainland China invested 2.5 times more in Hong Kong real estate than in 2016. Now the main volume of investments ($ 16.2 billion) is provided by investments in residential real estate, investors spent $ 6.9 billion for commercial properties during the year.
The rapid growth is associated with several reasons, including the exacerbation of relations between Beijing and Washington, writes the publication Nikkei. According to experts at Colliers International, against the backdrop of trade wars, mainland investors prefer to buy overseas property closer to home.
The volume of investment in real estate – $ 22 billion.
In Europe, the main center of attraction of Chinese capital in real estate is the United Kingdom. Private investors, as in the case of the United States, in this country are attracted by the possibility of obtaining a residence permit. For example, Chinese citizens account for about 30% of British Tier 1 (Investor) visa visas, which are issued in exchange for investments in public stocks or capital of British companies in the amount of 2 million pounds sterling.
In the commercial real estate segment, three quarters of transactions with Chinese money fall on Logicór, one of Europe’s largest warehouse operators. In December 2017, the Chinese corporation China Investment Corporation completed the acquisition of Logicor for $ 14.4 billion. Thus, the Chinese investor received about 13.6 million m² of commercial space in Europe.
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