What's Behind China's Worldwide Real Estate Shopping Spree?
In the recent wave of Chinese investors going global, it is remarkable how much goes into real estate and other businesses that have a large element of fixed assets.These investments reveal a lot about the forces driving the spread of Chinese capital.
Take London for example, which claims to attract more Chinese investors than any other city worldwide.A closer look reveals a string of major acquisition deals that are not takeovers of companies but takeovers of commercial property(see chart below). Two major purchases of office complexes were announced in April 2016. TheAldgate Towerbuilding in the City of London was acquired by China Life Insurance together with Brockfield Property Partners for ￡346 million, while in Canary Wharf the office complex17 Columbus Courtyardwas acquired by the investment arm of Hainan Airlines (HNA) Group. Chinese investors led by the investment fund China Minsheng Investment are also backing the Airport City development project in theRoyal Albert Docks. Announced during Xi Jinping’s visit to the UK in October 2015, this project envisages a total investment of ￡42.6 billion to develop infrastructure and commercial real estate near London’s City Airport.
Elsewhere, Chinese investors have been particularly active in New York. In one of the most talked about deals, Anbang Insurance took over the iconic Waldorf Astoria hotel for $1.95 billion, while business groups like Greenland and Fosun have been investing in residential and commercial real estate projects. Iconic buildings in Chinese hands include the General Motors Building, the Atlantic Yards project in Brooklyn, 717 Fifth Ave, and 1 Chase Manhattan Plaza. Also Canadian and Australian cities Vancouver, Toronto, Sydney, Melbourne and Brisbane have seen a surge of Chinese investment in real estate. In Europe, the Fosun Group acquired the historic Milan headquarters of Unicredito, known as Palazzo Broggi, for
