Authors: Lisha He*,
Topics: Economic Geography, China
Keywords: China, real estate, Chinese migrants, ethnic networks, United States
Session Type: Virtual Paper
Start / End Time: 8:00 AM / 9:15 AM
Room: Virtual 36
Presentation File: No File Uploaded
Since the 2010s, Chinese foreign direct investment in real estate (FDIRE) has emerged as a major force within global real estate markets, challenging the traditional dominance of Western investors. A classical driver of FDIRE is favorable market conditions, which investors seek to maximize profits. It is unclear, however, whether the investment determinants of Chinese FDIRE diverge from those for FDIRE from advanced economies, which to date have represented both the primary investment forces and main objects of study. To uncover the potentially unique determinants and heterogeneity of Chinese corporate real estate investors – among them an institutional environment comprised of strong state intervention and a system of social networks important for fostering business ties (guanxi) – we build and analyze a state-level panel dataset of Chinese FDIRE by state-owned (SOEs) and private enterprises (PEs) in the U.S. from 2010-2017. Our empirical results reveal the importance of Chinese migrants in promoting Chinese real estate investment, especially by PEs. We also demonstrate that PEs depend more on Chinese overseas communities than SOEs, perhaps because they can count less on government support to overcome investment barriers. Finally, we find that the spatial effects on Chinese FDIRE are insignificant.