Wave of Chinese investors

There is a wave of Chinese investors about to inundate the Australian real estate sector with billions of dollars.

Chinese insurance companies have just made public their long-awaited updated regulations surrounding investment in overseas assets.

The changes allow the country’s insurers to significantly expand their offshore holdings, and Australia is set to benefit.

Under the new rules, Chinese insurers can invest up to 15 per cent of their total assets in overseas investments. It’s been estimated that such companies had the equivalent of more than $900 billion (Australian dollars) in assets.

Sian Sinclair, head of real estate and construction for Grant Thornton Australia, believes the opportunity should be carefully nurtured.

There’ll be tough competition, with the relaxed regulations opening investment to 45 world markets in a range of asset classes.

“The key will be actively marketing to these investor groups as we’re competing with strong markets including the UK, US and so on,” Sinclair explains. “They’re already vying for Chinese investment dollars. We’re working closely with our China firm to identify opportunities.”

The form of direct investments allowed in real estate remains restricted to mature commercial and office property with stable income located in ‘core areas’.

According to Sinclair, Australia can expect to see increased interest from China investors in established commercial sites in our larger capital cities.

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