The rapid devaluation of the Chinese yuan triggered a massive capital outflow of between 700 billion and 1 trillion USD in 2015. And a great deal of this investment capital is going into overseas real estate. In the first half of 2016 alone, Chinese entities invested 16.1 billion USD into overseas real estate. Half of this investment, 8 billion USD, came from Chinese insurance companies. 23 percent came from Chinese conglomerates, with another 10 percent from property developers.
According to Ada Choi, Senior Director of Research at CBRE Asia Pacific, “Concerns over the market slowdown in their home market have led Chinese investors to seek a safer investment environment which offers higher potential returns.”
Chinese investors have contributed to a massive real estate boom in certain Canadian cities – most notably Vancouver, where the price gains have been called “gravity-defying”. According to a report by real estate firm Re/Max, house prices in the city soared by 24 percent during Q1 2016 compared to Q1 2015, with the average price of a single-family home in Vancouver standing at 2 million USD.
Major investments by Chinese entities into US real estate include Anbang Insurance’s 6.5 billion USD acquisition of Strategic Hotels & Resorts from Blackstone, and its 1.95 billion USD acquisition of the Waldorf-Astoria in New York.
Chinese buyers spent a total of 17 billion USD on commercial real estate in the US between 2010 and 2015, and a whopping 93 billion USD on US homes.
However, Chinese overseas property investments are by no means confined to North America. African property is also becoming popular among Chinese investors. A recent in-depth study by Dr. Honita Cowaloosur at Stellenboch University in Cape Town documents growing Chinese appetite for property in South Africa and Mauritius.
On December 7th, 2016, in Shanghai, Naseba will be organising the Global Real Estate Investment Meeting. At the meeting, pre-screened Chinese investors will be introduced to pre-qualified real estate investment opportunities from around the world.
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Naseba investor introduction
+971 4 455 7954