Chinese real-estate investors, facing pressure from Beijing, are reversing a yearslong buying spree in the U.S. where they often paid record prices for marquee properties, The Wall Street Journal reported. Chinese insurers, conglomerates and other investors have turned net sellers of U.S. commercial real estate for the first time in a decade. They have spent tens of billions of dollars to acquire hotels, office buildings, and vast swaths of empty land to build residential towers, but Chinese investors sold $1.29 billion worth of U.S. commercial real estate in the second quarter while purchasing only $126.2 million of property. This marked the first time that these investors were net sellers for a quarter since 2008. The more than $1 billion in net sales reflects how much the Chinese government’s attitude toward investing overseas has changed in recent months. Chinese investors began scooping up U.S. real estate a few years ago after Beijing officials loosened restrictions on foreign investment. They quickly made their mark in U.S. cities like Los Angeles, San Francisco and Chicago with high-profile acquisitions, including the $1.95 billion purchase of the Waldorf Astoria in New York, the highest price ever paid for a U.S. hotel. Now, the Chinese government has changed course again, cracking down on certain types of outbound investment that include real estate in part to help stabilize the currency. Chinese companies are unloading prize properties to repay debt and to comply with regulatory and market pressures from home. Analysts say that increasing tensions over trade and national security between China and the U.S. also have contributed to the pullback. The retreat by Chinese investors could slow growth further in the U.S. commercial real estate market. Property values have plateaued on average in the last 18 months after rising sharply in the early years of the post-2008 financial crisis recovery.
