Caixin: Survey Finds Data Don’t Show Full Picture of Overseas Real-Estate Spree

China invests more in global real estate than other Asian countries, but data do not show how much Chinese money already moves about offshore, reports Pan Che for Caixin. The Chinese government imposed regulations on outward direct investments, including limits on “irrational” investments like sports clubs or entertainment, “to stem capital outflows and prevent the yuan from depreciating further,” Pan reports. “Official data showed that all Chinese firms’ ODI in real estate dropped 82% year-on-year during the first half” but a report from CBRE commercial real estate firm suggests that “private firms’ spending on overseas real estate deals grew 102% year-on-year.” Discrepancies may suggest that regulations do not apply evenly among all entities like sovereign wealth funds versus state-owned enterprises and may reflect government strategies. Pan offers an example of the large acquisition of the European warehouse firm Logicor by China Investment Corp., “with an eye on forging a logistic network to advance the ‘Belt and Road’ initiative.” Real estate analysts express concern that China’s outbound investment rules could limit inbound investments, as investors worry about limits on quick exits. – YaleGlobal

Caixin: Survey Finds Data Don’t Show Full Picture of Overseas Real-Estate Spree

China’s capital controls on outward bound investment have little effect over Chinese money already circulating outside of the country
Pan Che
Thursday, August 24, 2017
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