Outbound capital evolves: Chinese regulatory changes and US tax changes enhance opportunities for Chinese investors in US real estate
Chinese investors have long looked to real estate as a core investment, as evidenced by the flow of Chinese capital into the US real estate market in recent years, with Real Capital Analytics reporting an increase of such capital flows from US$748.4 million in 2010 to US$10.0 billion in 2015.
The initial wave of outbound Chinese capital was driven by direct real estate investments from cash-rich institutions and wealthy family offices seeking to invest in the United States to diversify their capital away from their home country.
China’s adoption of more-liberal government policies has led to the increased flow of cross-border capital for domestic residents’ offshore investments and financing activities. These government policies include the Decision of the Central Committee of the Communist Party of China on Some Major Issues Concerning Comprehensively Deepening the Reform on 12 November 2013, the State Administration of Foreign Exchange releasing Circular 37 in Ju