Chinese Real Estate Deals Drop in U.S. as Regulators Clamp Down

(Bloomberg) -- Chinese investment in U.S. commercial real estate is falling, an ominous sign for landlords with buildings to sell.

After several years of breakneck deals around the globe, Chinese firms are slowing down as their regulators restrict overseas investment in an effort to curb speculative purchases and keep capital from flowing out of the country. In New York City, the biggest beneficiary of the shopping spree, Chinese companies bought just $3.4 billion of properties in 2017, a 54 percent decline from the prior year, according to a report Tuesday by Cushman & Wakefield.

Chinese investors won’t be going away this year, but they’ll focus on segments that are most likely to receive government approval, like logistics properties and student and senior housing, the brokerage said.

Buyers from China helped propel real estate values to records following the recession, with deals such as the 2015 purchase of Manhattan’s Waldorf Astoria by Anbang Insurance Group Co. for $1.95 billion, the most ever paid for a U.S. hotel. Another Chinese company, HNA Group Co., is seeking to sell U.S. properties including 245 Park Ave., the Midtown office tower it bought just a year ago for $2.2 billion.

©2018 Bloomberg L.P.

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