Exclusive | China-Australia relations: US$58.5 million Sydney property deal halted by ‘chilling effect’ on foreign investments
- A group of Chinese investors withdrew its bid to purchase a A$80 million (US$58.5 million) office tower in Sydney after waiting eight months for approval
- Australia announced new processing times for foreign investment applications in March alongside other sweeping changes to Australian foreign ownership laws
A group of Chinese investors has withdrawn its bid to purchase a A$80 million (US$58.5 million) office tower in Sydney after the Australian Foreign Investment Review Board (FIRB) delayed approval of the deal for eight months.
Whatever the motivation, the cancellation of the sale has raised concerns in the Australian real estate industry – a key beneficiary of Chinese investments – whether tensions between China and Australia have spilled over into foreign investments in property.
The group of private Chinese investors backed out of the purchase of the prominent eight-storey office tower at 191-199 Thomas Street in Sydney’s Chinatown late last week after failing to hear back from Australia’s review board two months after it was due to respond.
The property is a generic commercial office investment with no sensitivities that I am aware of, and therefore I am at a loss as to why the FIRB has not responded after eight months
“Naturally it is disappointing to all parties involved as a considerable amount of time and money has been spent [on the Thomas Street transaction],” said Vince Kernahan, the national director of capital markets at real estate firm Colliers International, who oversaw the deal.
“The property is a generic commercial office investment with no sensitivities that I am aware of, and therefore I am at a loss as to why the FIRB has not responded after eight months.