Foreign capital pours into Beijing commercial real estate

Downtown Beijing. Foreign investors claimed more than a third of the commercial real estate deals in the capital.

Foreign investors invested more money in real estate in China over the past year.

In the capital, Beijing, foreign investors were demanding more than a third of commercial real estate deals, an increase over previous years, property manager JLL said Thursday, CNBC’s Evelyn Cheng reported.

“Beijing is expected to remain a good choice for overseas investors as the country’s capital is likely to show more signs of recovery sooner than most of the other major overseas markets,” Michael Wang, senior director of capital markets at JLL North China, told a release.

The new corona virus first appeared in the Chinese city of Wuhan at the end of 2019. The disease spread overseas and turned into a global pandemic within months. However, the outbreak in China stalled in the second quarter after authorities took tough measures to limit human contact.

Companies also invested more money in projects in China in the past year, as measured by foreign direct investment.

In November, FDI for 2020 was $ 129.47 billion, according to official figures, up from the same period last year. With that, China is on track for record-high FDI last year, according to Macquarie estimates released on Thursday.

According to Wind Information, China recorded $ 138.13 billion in FDI in 2019, up from nearly $ 135 billion in 2018. Official 2020 figures from the Department of Commerce are expected later this month.

In the financial markets, foreign investors more than doubled their purchases of Chinese bonds last year, according to Macquarie estimates, a record high of 1.1 billion yuan.

Foreign investors have gradually increased their share of transactions in the capital’s commercial real estate market.

According to JLL, the share rose from 22 percent or a little more than a fifth in 2018 to 30 percent in 2019 and 35 percent in 2020.

Revenue of 47 billion yuan ($ 7.26 billion) in 2020 exceeded that of 2018, JLL said. The market was still suffering from the shock of the coronavirus – sales volumes were well above a multi-year high of 80 billion yuan in 2019, JLL said.