For wealthy Chinese, the price doesn’t matter, whether it’s luxury goods or New York real estate.
But, when it comes to real estate, the rich Chinese form insurance companies, like Anbang Insurance Group, which bought the Waldorf Astoria Hotel in New York City for $1.95 billion last October.
Insurance companies are the driving force behind Chinese investment in real estate, which totaled $3.3 billion in 2014. Unlike some of the domestic players, wealthy Chinese are more willing to pay these high prices, ever since China relaxed guidelines on outbound investment for institutional investors in 2012. However, the Chinese total is still less than 10 percent of New York’s 2014 transaction volume of $55.4 billion, the world’s largest.
There has been a fair bit of volatility [in the Chinese market], so they are trying to diversify and smooth that volatility.
, Cushman & Wakefield
