Tightening the spigot of Chinese capital flows
Chinese investment in US commercial real estate slowed in 2017, falling 55 percent following the imposition of capital controls, according to Cushman & Wakefield. The firm estimates Chinese investors deployed US$7.3 billion into commercial real estate acquisitions during 2017, a 55 percent decrease from 2016. As a result, China fell behind both Canada and Singapore in the ranking of largest sources of foreign capital in US commercial real estate transactions.
In addition, overall foreign direct investment flows from China into the United States fell 35 percent in 2017 to US$29 billion, according to the Rhodium Group.
Investments were concentrated in five US markets: New York City, San Francisco, Los Angeles, Chicago and Seattle, with New York City and San Francisco accounting for two-thirds of Chinese investments. Demand for office and industrial properties remained relatively supported in 2017, in contrast to hotel, development sites and multifamily. Mega-deals an