Over the past few years, there’s been an influx of Chinese money into the U.S., increasing from about $58 million in 2000 to $14 billion in 2013.
The Chinese are interested in acquiring everything American, from companies to commercial and residential real estate. Their motivation is straightforward: They feel their assets are much better protected in the United States. Just this week, Beijing-based studio Huayi Brothers Media Corp. said it planned to spend $130 million in the U.S. to create a subsidiary to distribute movies and TV shows.
Experts use terms such as “safe haven” and “stash pad” to refer to Chinese acquisitions and investments in the United States. Including last year’s $14 billion and money coming to the U.S. so far this year, Chinese foreign direct investment in the U.S. since 2000 now totals nearly $40 billion, according to the Rhodium Group.
“There is much more trust (felt for) the United States and the U.S. government that those assets will be protected by the government, compared to the assets here in China, which could be taken away tomorrow,” said Michael Godin, vice president of Real Estate Global Partners, who pairs Chinese investors with brokers in the U.S.
But the money is safe only if it actually makes it to the United States. Because Chinese law prohibits any more than $50,000 U.S. dollars leaving the country per person per year, Chinese investors and companies are getting increasingly creative when it comes to getting their money out of China and into the United States.