Back HomeMidtown Luxury and The Foreign Investor
Most of the buyers in Manhattan are all cash buyers from foreign countries. Midtown Manhattan, the Plaza Region, and 57th street (one of the most popular streets recently coined “billionaires row”) caters specifically to foreign buyers. Last year alone, “foreign buyers spent more than $87 billion on U.S. properties”(4). The tallest residential building in the Western Hemisphere, has a landing page that prompts the prospective buyer to choose a language among seven choices.
Photo via 432 Park Ave
Louise Story of the New York Times states that the government will now start regulating and keeping track of the foreign buyers of high end properties to avoid the use of “dirty money” in the real estate market. The goal is to increase transparency in the transactions; and to reveal the shell companies that are involved in purchasing those high-end properties. Over half the homes that are purchased in Manhattan worth over $5 million dollars are purchased using shell companies (2).
In 2015, the prominent investors were from China, but since the slow of the Chinese economy the past couple of months, real estate developers are looking elsewhere for their investors (3). Since the price of oil has dropped significantly from 2014, the majority of oil investors are turning to Manhattan’s luxury commercial real estate market for an alternative investment. Many investors now come from Russia, Norway, and in many countries from the Middle East (4). “Investors are now focused on multifamily buildings, office condominiums and mixed-use buildings as long-term investments” (4).
Photo Via Corcoran
Since 2008, Real Estate has become one of the most regulated industries in the United States. Properties have increasingly become commodities not just for living, but for capital gain. Manhattan has always been the most saught-out and competitive markets for both domestic and foreign investors; and it will continue to be one of the prominent markets as developers seek investors.
Written by Kylie Keller
(1) 432 Park Avenue
(2) New York Times
(3) The Real Deal: Chinese Investors
(4) The Real Deal: Buyers from Oil-Rich Nations
