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Foreign investors take a break from New York market

Even Canadians, frequent champions of U.S. real estate investment, were slightly less enthusiastic last year, spending a little more than a billion dollars in New York compared $1.5 in 2016 and a whopping $8.3 billion in 2015. The biggest year-over-year ...

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0 Likes 0 Comments Print Tags financeforeign investment Changes in global markets and geopolitics led to a precipitous drop in foreign investment into Manhattan real estate last year. In 2017, Cross-border investments accounted for barely more than half of 2016’s total, falling from $14.2 billion to $7.67 billion, according to Eastern Consolidated’s end of year View from the Street report, which showed major players from the year prior such as China, Hong Kong, Germany and the U.Kpulling back significantly. Declines in foreign spending were part of a weak overall investment market, which fell 41 percent to $23 billion, a seven-year low and less than half the haul from 2015 when sales nearly reached $60 billion. “The slowdown is a reflection of a turning market,” Eastern Consolidated Chairman and CEO Peter Hauspurg said, “and when a market turns there tends to be a lull in sales activity as buyers and sellers adjust their expectations.” German investment dropped from $2.3 billion to less than $840 million, Honk Kong capital shrank from $1.2 billion to $547 million and English purchases were hobbled to $188 million in 2017 after surging to $1.4 billion the year beforeIsraeli spending was also down more than half a billion dollars year-over-year. Even Canadians, frequent champions of U.Sreal estate investment, were slightly less enthusiastic last year, spending a little more than a billion dollars in New York compared $1.5 in 2016 and a whopping $8.3 billion in 2015. The biggest year-over-year drop in investment, though, came from Chinese buyers, who funneled $2.5 billion into the U.Sin 2017 after pouring $6.6 billion into the city in 2016. “A lot of the problem is the capital restrictions being enforced in China,” Pierre Debbas, of the law firm Romer Debbas, LLP, said“Previously, they were enforced but to say they were loosely enforced would be a conservative statement. “At the same time, the dollar has strengthened, so Europe is less interested in the U.Sand South American investors have not been very active here either,” he added, explaining that European investors have shifted their focus to emerging markets where they can get better returns. Compounding those international trends, Debbas said there are a few domestic developments that have made the U.Sless enticing to the global investor class, including falling cap rates and rising interest rates nationwideAdd to that the inflated costs of land and labor in the city and New York is a hard sell for some. However, 2017 did have some bright spots for the international markets, including a Scandinavian surge from Norway ($605 million) and Sweden ($160 million), neither of which accounted for any investment in 2016Singaporean investors also upped the ante with nearly $1.1 billion in 2017 investment compared to $158 million in 2016. Japan, meanwhile, stayed steady at roughly $477 million in each of the last two years. MORE IN Finance & Accounting Twitter seeks up to 15,000 s/f for New York HQ READ MORE Comments are closed Costa joins KEY Real Esta... KEY Real Estate Holdings announced a new equity partner... 3,968 views Long Island City bidding... Long Island City is throwing its hat in the ring for a... 854 views Developers rushing to mee... With the influx of interest in the Mott Haven neighborh... 647 views WHO’S NEWS: Residen... Bess Freedman has been promoted to co-president of Brow... 382 views LEASES: GFP inks 25,000 s... Todd Street Productions, Inchas signed a 5,625 s/f le... 333 views IN PICTURES: Academy of C... Real estate coach Esther Muller  just closed another su... 288 views Latest Posts Union Investment buys Meatpacking retail condo for $88 million Feb 21, 2018• 0 IN PICTURES: Winston Fisher at YM/WREA Luncheon Feb 21, 2018• 0 TRANSACTIONS: Meridian Capital puts together a pair of $19M loans Feb 21, 2018• 0 LATEST REAL ESTATE VIDEOS CategoriesDeals & Dealmakers Construction & Design Residential Retail Finance & Accounting Opinion Headline Editorial Supplements Featured Green Building Headline ICSC RECon Legal Marketing and Public Relations Mergers and Acquisitions Office Market Property Managers ArchivesArchives RE WEEKLYAbout Real Estate Weekly Contact Us Staff Directory Editorial Calendar Advertise RSS Feed Copyright 2013 FUEL THEMESAll RIGHTS RESERVED Subscribe /* */ /* */ /* */ /* */ _stq = window._stq || []; _stq.push([ 'view', {v:'ext',j:'1:5.7.1',blog:'139380592',post:'52053',tz:'-5',srv:''} ]); _stq.push([ 'clickTrackerInit', '139380592', '52053' ]);

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