In what is set to become the biggest real estate purchase by Chinese investors, NYC’s most iconic hotel, Waldorf Astoria, has agreed to be sold for the price of $1.95 billion.
That would be the highest price for a single existing hotel in the country, and the most paid for a standing U.S. building by a Chinese buyer, said Kevin Mallory, global head of the hotels unit of commercial real estate brokerage CBRE Group Inc.
The Waldorf deal follows such high-profile New York acquisitions as Shanghai-based Greenland Holding Group Inc.’s purchase this year of a 70 percent interest in the Atlantic Yards project in Brooklyn. In late 2013, billionaire Guo Guangchang’s Fosun International Ltd. paid $725 million for lower Manhattan’s 1 Chase Manhattan Plaza, the former headquarters of Chase Manhattan Bank.
In the past couple years, the Chinese government has allowed the country’s insurance companies to allocate a portion of their funds into global real estate, Mallory said. With concerns about volatility in the property market at home, New York and and other major markets around the world, including London and Paris, “tend to be safe havens for any global investor,” he said.
The surge in Chinese real estate investment overseas is reminiscent of the Japanese wave of property purchases in the U.S. and other countries in the 1980s, which included New York’s Rockefeller Center and California’s Pebble Beach golf course. Many Japanese buyers were forced to sell when the U.S. fell into recession.