China's Stock Crisis Is Good For US Real Estate Market, Expert Says

Chinese investors spent $8.6B in US commercial real estate in 2015—four times more than the year before. And there could be more to come, CBRE head of research Spencer Levy says.

"Volatility from China is the new normal, and the sooner we get used to it the better," Spencer tells CNBC, adding "global instability often leads to more foreign capital flows to the safe havens."

As China's stock market started plunging last summer, investors responded by taking their money somewhere safer, buying up US properties in bulk. (Despite the record-breaking deals like the Waldorf Astoria, most of the Chinese acquisitions came in the warehouse sector, CBRE research says.)

In addition, laws like the recently passed FIRPTA, not to mention the EB-5 extension, open up for additional flow of Chinese capital. But some are skeptical about how long Beijing will continue to allow capital flows into the United States and other foreign countries.

Sam Chandan, a professor at the Wharton School of the University of Pennsylvania, says the volatility raises the possibility of a "policy intervention on behalf of the Chinese government" that could limit the capital outflow. [CNBC]

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