Greenland invests in New York project
State-controlled mainland developer Greenland, which secured a back-door listing in Hong Kong in August, is investing in a New York property project valued at more than US$5 billion, becoming the latest Chinese real estate company to venture overseas.
Greenland said yesterday it signed a memorandum of understanding on October 2 with Forest City Ratner to develop the Atlantic Yards Apartment Project in Brooklyn.
It will take a 70 per cent stake in the development, anchored by the Barclays Centre, home of the National Basketball Association's Brooklyn Nets. It said the deal was the biggest of its kind by a Chinese developer in the US.
"The trend for Chinese developers to continue to invest in the property market abroad will depend on the returns they get in the first batch of such investments," said Frank Chen, the Shanghai-based head of China research at property broker CBRE. "The biggest challenge they face is not knowing the foreign markets well, so it's wise to work with local partners."
Mainland property developers are expanding overseas as the central government maintains curbs on residential housing at home to cool prices. China Vanke, the biggest homebuilder listed on the mainland, has already joined a residential property venture in San Francisco.
Construction of the first residential tower at Atlantic Yards began in the fourth quarter of last year, Forest City said in March. Half of the 32-storey, 363-unit building will be reserved for low, moderate and middle-income residents, the company said.
"Greenland holds a positive view on the US market," chairman Zhang Yuliang said. "The US economy is recovering."