By Jim Costello on February 28th, 2018
Cross-border acquisitions of U.S. commercial property dropped by almost one-quarter in 2017, outpacing the decline in activity by domestic capital sources, the latest US Cross-Border Investment Compendium shows.
Deals by domestic investors were down only 3% year-over-year in 2017 versus a 23% year-over-year decline for cross-border investors. Despite the pullback in cross-border deal activity, these investors still represented 11% of all direct acquisitions in the U.S. for 2017. This level can be viewed as a return to normality; over the long term cross-border investment has represented 10% of the market.
With the news swirling around the restrictions on Chinese capital outflows, the instinct is to write off all the cross-border slowdown as a function of Chinese investors, but this group was still the #3 source of cross-border investment activity in 2017. Canadian investors have returned to their natural position as the leading cross-border investor group in the U.S. and Singaporean investors were the second largest.
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