What's Behind China Life Insurers Buying Up American Real Estate?
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Want to sell a prized piece of real estate? Get yourself a Chinese broker.
Two more insurers hopped on the U.S. real estate band wagon this week and bought a majority stake in prime $500 million Boston Seaport district real estate. Who cares if the thing is worth less than that? The Chinese insurance industry is desperate for foreign assets to diversify risks out of local assets and the yuan.
“My Chinese clients are looking for ‘safety deposit boxes’ in luxury American real estate. And they are not necessarily trying to make a lot of money from rent, but instead are looking to preserve wealth,” says Marlen Kurzkhov, an attorney with Gusrae Kaplan in New York.
China Life Insurance Company and Ping An Insurance Company said Wednesday that they will be co-investors in a Boston waterfront project being built by Tishman Speyer Properties, one of the world’s leading developers.
Artist rendition of what the Pier 4 Seaport District build out might look like. Whatever it looks like, China will own a chunk of it.
The China companies will be the main foreign investors in Tishman’s Pier 4 project, an undeveloped workman’s pier that was once home to the famous Anthony’s Pier 4 restaurant. It is now basically a parking lot for concert goers at the nearby Blue Hills Bank Pavilion. Once Tishman is through with it, it will house luxury condos on Boston Harbor, and a few commercial offices.
This is the second major U.S. real estate purchase by a Chinese life insurer.
Last year, Anbang Insurance paid Hilton Hotels an astonishing $1.9 billion for the iconic Waldorf Astoria in midtown Manhattan. It was one of the highest prices per room ever paid for an American hotel.
China Life and Ping An are China’s two largest insurers. While they will be the biggest foreign owners in the project, the size of the their stake was not immediately known, China Daily reported today.
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