The landmark Waldorf-Astoria’s owner Hilton Worldwide announced last month that it was planning to sell the grand hotel to the Beijing-based Anbang Insurance Group for $1.95 billion. Hilton claimed it would retain a 100-year management contract at the hotel and the property would be renovated.
Planned to close on Dec 31, the purchase marks the first real estate acquisition in the U.S. by Anbang, which is reportedly planning an initial public offering that could raise the price even higher to about $2 billion.
The president and chief executive officer of MHP Real Estate Services, Norman Sturner, said the Waldorf deal was mostly about getting the money out of China and “burying it in America,” while speaking on a panel this month.
Sturner has also said he recently heard about Iraqi and Ukrainian money looking to make its way to New York. He later explained to Commercial Observer that MHP received calls “from two separate investment advisers purporting to represent both of those countries seeking opportunities in New York City real estate” when it was announced that his company was part of a joint venture buying 180 Maiden Lane for $470 million.
Money from foreign markets making its way into New York is nothing new. As far back in the 1980s, the Japanese were making such large real estate plays in America, said Phil Feder, a partner in the real estate department at international law firm Paul Hastings at an October media roundtable titled “Asia Outbound Investment in U.S. Real Estate.” But what is new here is the pace by which foreigners are putting money into the City market has been climbing steadily.
“China’s the big winner in terms of leading foreign investment lately in New York City,” said Kenneth Weissenberg, a tax partner and co-chair of the Real Estate Services Group at EisnerAmper. “The central government in China I think is encouraging Chinese firms to invest overseas. The United States is a very stable environment, has strong currency, a strong real estate market and compared to prices in the rest of the world, what we consider expensive is a bargain.”
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Filed Under: Real Estate News Tagged With: Chinese Real Estate, Hilton Worldwide, New York Real Estate, Real Estate Investment, Waldorf Astoria