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Chinese Outbound Commercial Real Estate Investment Volume Second Only to the U.S.

According to a report by commercial real estate services firm DTZ/Cushman & Wakefield, Chinese outbound commercial real estate investment totalled US$17 billion (C$22 billion) during the first five months of 2016. This means that investment in January through May of this year has already reached 65.6% of the US$25.734 billion invested last year.

The United States was the sole country to invest more in foreign real estate than China, with US$19 billion in outbound real estate investment during the same five month period, and in turn also received 62.3% of China’s real estate investment. 2016’s first five months had China invest US$10.6 billion into the American real estate market, with New York City alone receiving US$3.5 billion of this amount. Researchers cited a recovering US economy and dollar appreciation as reasons for this year’s 143% increase in Chinese real estate investment into the US, with all of last year only totalling US$4.37 billion.

During 2016’s first five months, 50% of Chinese outbound real estate investment went into offices, and 80% of these office investments were concentrated in either Hong Kong or the United States. Hotel investments during the period were also notable, being 28% higher than all of last year and making up 42% of Chinese investment in early 2016, or US$7.1 billion. The paper also forecasts 2016’s growth in investments to be 50%, even after China’s first quarter GDP growth slowed by 0.1% to 6.7%.

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