China Making BIG Moves into U.S. CRE

Anbang is China’s largest insurance company and they already own the world-famous Waldorf Astoria in New York. They bought it for $1.95 billion ‒ the highest price ever paid for a U.S. hotel.

Over the weekend Anbang paid $6.5 billion for a portfolio of 17 of the most famous luxury hotels in Laguna Beach, and Jackson Hole, as well as more in New York, Chicago and San Francisco ‒ and that included the Del Coronado – San Diego.

Monday came with ANOTHER huge offer from Anbang: $12.2 billion to takeover Starwood Resorts Worldwide from Marriott.

Anbang is benefiting from the December 2015 Congressional changes to REIT and FIRPTA laws that now greatly favor the investment of foreigners into U.S. markets. 

Talk about heavily connected! Wu Xiaohui is the CEO of Anbang, married to the grand-daughter of Deng Xiaoping, China’s deceased but still revered leader. One of Anbangs directors is Chen Xiaolu, the son of Chen Yi, a top military commander under Mao. Anbangs director is Levin Zhu, the son of Zhu Rongji, China’s former prime minister, and a successful banker in his own right. Serious power and backing!

Already in 2016 China has invested as much as HALF of the $55 billion it invested in 2015 into the U.S. market. Expect 2016 to be over $100 billion invested into the U.S.

What will the effects be on our markets as billions of dollars pour into U.S. markets?

How will american investors compete against the power of the China-Fed? it wont be easy for the big-fish, but for smaller investors like you and me we can benefit by buying NOW before prices rise.

What will our markets do when our stocks responded so closely to China? A slow down in China will only help the U.S. economy. Expect China to continue and accelerate their buying U.S. real estate.

Many questions and the only good answers are long and complex – but a must read for anyone investing in commercial real estate today!

We suggest thinking long term. Short term won’t work in a volatile market ever. Position yourself with a long term strategy and buy commercial real estate now, don’t wait. All indication are that 2016 will be a big year for growth in  real estate and 2017 could easily follow that trend.