At a time when the U.S. economy is welcoming foreign capital in an effort to turn things around, New York City is winning a high level of interest from Chinese investors. So much so, that in the past year alone, Chinese companies and entrepreneurs have invested more than $1 billion into New York real estate.
Rumored to be comparable to the 1980's boom in Japanese investment, China's interest in expanding its foreign exchange reserves is believed to be the main reason for the high increase in Chinese investment. Among the biggest real estate investments include leases at the Empire State Building and 1 World Trade Center.
In what may be the largest investment NYC has seen since 2008, the Bank of China reportedly lent $800 million in 2010 to refinance a building on Park Avenue, the home of JPMorgan Chase and Major League Baseball.
"Everybody wants to come to New York because New York is the starting point for going global," said Xue Ya, president of the China Center, a business and cultural organization.
Despite the fact that the number of Chinese investments made in the United States is significantly lower than in developing countries, experts believe that recent interest in the city is only a sign of what's to come. "In terms of overall flow from China into the U.S., many of us believe that it could accelerate very quickly," said Clarence Kwan, of Deloitte.
In addition to the high level of interest from major banks and cooperations in China, investments made through the EB5 Visa Program are also set to take the city by storm. Forest City Ratner Companies, a leading urban real estate company in the New York metropolitan area, is said to have secured $249 million from Chinese investors for residential and office towers to be built at Atlantic Yards, a project that includes a new stadium for the New Jersey Nets.
Other projects funded through the EB-5 program include a $30 million hospital and hotel project in Flushing, Queens. Developers reportedly had to turn down numerous EB5 immigrant investors, suggesting a significant increase in the number of EB5 foreign entrepreneurs wishing to invest in the city.