The Urban Developer
AdvertiseEventsWebinars
Urbanity
Awards
Sign In
Membership
Latest
Menu
Location
Sector
Category
Content
Type
Newsletters
URBAN LEADER AWARDS ARE BACK! START YOUR NOMINATIONS
URBAN LEADER AWARDS ARE BACK! START YOUR NOMINATIONS
LEARN MOREDETAILS
TheUrbanDeveloper
Follow
About
About Us
Membership
Awards
Events
Webinars
Listings
Resources
Terms & Conditions
Commenting Policy
Privacy Policy
Republishing Guidelines
Editorial Charter
Complaints Handling Policy
Contact
General Enquiries
Advertise
Contribution Enquiry
Project Submission
Membership Enquiry
Newsletter
Stay up to date and with the latest news, projects, deals and features.
Subscribe
OfficeStaff WriterTue 14 Nov 17

Chinese Investment Plunges 51% But Remains Ambitious in Australia

TUD+ MEMBER CONTENT
china-1
SHARE
1
print
Print

While China’s standing in the domestic and international real estate and investment market measure in the billions, the latest figures revealed their financial activity has almost halved since 2016.

According to Cushman & Wakefield’s Chinese outbound investment report for the 2017 third quarter, the cumulative mainland Chinese real estate transaction volume of US$18.2 billion is approximately half that of 2016’s total for the full year.

Mainland China’s total outbound real estate investment plunged 51 per cent compared to last year, the lowest total in 14 quarters.

Much of this drop-off can be attributed to regulations put in place recently by the Chinese government, who ramped up efforts to control overseas real estate investment by issuing "Circular 74" in August and in the midst of 2017’s third quarter.

Related reading: Chinese Interest in Australian CRE Falls Following Regulations on Outbound Investment

Cushman & Wakefield said this was the second regulation announced in nine months that sought to restrict outbound investment capital flows, branding overseas real estate investment as a “limited” category though not “prohibited”.

“The government’s increasing scrutiny on real estate investment activity, coupled with investor caution prior to October’s 19th Party Congress meetings in Beijing, had a dampening impact on overseas transaction volume,” the report author's said.

It is a period of uncertainty within the Chinese investment community, with investors adopting a wait-and-see approach to the markets surrounding them rather than leaping in whole-heartedly into the next appealing venture.

Despite the surface appearance of a bleak outlook in China’s investment scene, their activity has still reached the billions and many investors are eager to interact with international markets amidst tightening controls.

Some of the biggest investment transaction during the quarter include the 444,312 square metre Nine Elms Square in the United Kingdom by CC Land Holdings and R&F Properties Development for US$621 million, Sha Tin Town Lot No 601 by Hong Kong Country Garden Holdings Development for US$312 million, and the 363-hectare Wyndham Vale, picked up by Australia Country Garden for US$304 million.

Cushman & Wakefield reported that Australia was the favourite in terms of overseas destination for Chinese investor sentiment, which resulted in of US$783 million in transactions during the quarter.

“Mainland Chinese investors have deployed a cumulative US$1.2 billion in real estate Down Under thus far in 2017. The development sector grew to account for over 63 per cent of Q3 Mainland Chinese real estate investment capital as investors targeted the sector in a variety of Australian cities.

"During China’s turbulent situation with investment restrictions, the majority of overseas investment was directed at the development sector at a 58 per cent share, a trend anticipated will remain over the short- to mid-term in places like London, the US and Australia.

Mainland Chinese investment into overseas development sites recorded a US$8.4 billion through the first three quarters, growing 234 per cent. Office investment received just a 28 per cent share of third quarter mainland Chinese outbound real estate investment volume, down a substantial 83 per cent.

Cushman & Wakefield remain optimistic that Chinese outbound investments would return, and that there was no fundamental change in China's "go global" strategy.

ResidentialIndustrialHotelInternationalAustraliaFinanceReal EstatePolicyLegalPolicy
AUTHOR
Staff Writer
"TheUrbanDeveloper.com is committed to delivering the latest news, reviews, opinions and insights into the best of urban development from Australia and around the world. "
More articles by this author
ADVERTISEMENT
TOP STORIES
Scape PBSA Kingsford EDM
Exclusive

It Takes More Than a Room: PBSA Evolves to Meet Student Demands

Clare Burnett
7 Min
Exclusive

Soheil Abedian: What’s Driven the Man Who’s Transformed a City

Phil Bartsch
7 Min
Exclusive

Robots Not a Miracle Cure for Housing Productivity Crisis

Vanessa Croll
6 Min
Exclusive

Where 600 Wealthy Families Are Putting Their Millions

Taryn Paris
6 Min
Brique Projects EDM
Exclusive

Brique Thrives in Cauldron of SE Queensland Development

Clare Burnett
7 Min
View All >
Queen's Whard EDM
Hotel

Star Back to Square One After Queens Wharf Deal Collapses

Clare Burnett
Industrial

ISPT Files Plans for Dandenong Mega-Logistics Project

Salvos Coliving EDM
Residential

Investa, Salvos Reveal Co-Living Plan for Sydney CBD

Clare Burnett
The 17-storey project in the CBD would rise on the site of The Salvation Army’s headquarters in the capital…
LATEST
Queen's Whard EDM
Hotel

Star Back to Square One After Queens Wharf Deal Collapses

Clare Burnett
3 Min
Industrial

ISPT Files Plans for Dandenong Mega-Logistics Project

2 Min
Salvos Coliving EDM
Residential

Investa, Salvos Reveal Co-Living Plan for Sydney CBD

Clare Burnett
2 Min
Scape PBSA Kingsford EDM
Exclusive

It Takes More Than a Room: PBSA Evolves to Meet Student Demands

Clare Burnett
7 Min
View All >
ADVERTISEMENT
Article originally posted at: https://www.theurbandeveloper.com/articles/chinese-investment-takes-plunge-remains-ambitious-australia