16 June 2014
The growth of outbound Chinese investment
Earlier this month we posted an article about the surge in Chinese investment as reported by Tiffany Hsu in the Los Angeles Times. See, “China and JMBM’s Chinese Investment Group® are in the news again!”
That article prominently featured the Sheraton Gateway LAX hotel, its 15% increase in Chinese travelers since the beginning of the year, and its purchase by our Shenzen Hazens Real Estate Group, and JMBM’s role as counsel to Shenzen Hazens.
Special Report Just Released: Growing Together — China and LA County Report – June 2014
Tiffany Hsu’s article also summarized some of the interesting data from a new report dated June 2014 by the Los Angeles County Economic Development Corp. (LACEDEC), entitled “Growing Together — China and Los Angeles County.” A full copy of LACEDEC’s Growing Together report (the “Growing Together Report” or simply the “Report”) can be downloaded by clicking the link at the end of this article.
But here are the “Key Findings” of the Report:
- Investment into Los Angeles County from China has doubled over the past 5 years, with China becoming one of Los Angeles County’s top investors
- China and Los Angeles County continue to increase business and commercial ties and the opportunities for Los Angeles
- Tourism has nearly quadrupled over the past four years alone, from 158,000 Chinese tourists in 2009 to 570,000 in 2013, making China the top overseas market for Los Angeles tourism
- Los Angeles is America’s top international trade gateway to China and China’s top gateway to the U.S., handling nearly 45% of trade between the two countries
- China is the Los Angeles Customs District’s (LACD’s) #1 partner in international trade, accounting for nearly 60% of all activity at the San Pedro Bay ports
- LACD exports to China have increased from $23 billion in 2009 to $35 billion in 2013 – less waste and scrap and more consumer and knowledge-intensive goods
- Los Angeles County has the largest Chinese population of any county in the nation, and has grown from 360,000 in 2008 to 413,000 in 2012
- Los Angeles County has the largest number of Chinese students of any county in the nation, increasing from roughly 3,000 Chinese students studying in local universities in 2009 to roughly 10,000 in 2013
- Strong cultural and network ties are the foundation of the relationship
- Future business prospects may be found in clean tech, entertainment, aerospace, e-commerce, real estate/property development, tourism, logistics and electronics.
The new wave of Chinese investment is focused on real estate
The Growing Together Report says that China’s first wave of outward investment mostly involved state-owned firms, and was centered around acquiring energy, minerals and land in developing countries in order to secure precious natural resources. This has changed over the past couple of years as new motives are driving Chinese outward investment. The Chinese government is now placing a greater emphasis upon ensuring higher returns on investments rather than accumulating valuable resources. It has shifted its focus from developing countries to mature markets. State-owned enterprises are investing in real estate and infrastructure in those advanced economies.
The Report sees the exchange between China and Los Angeles County as a two-way street with mutual benefit for all. It says:
“Together Los Angeles County and China can take the lead on the most pressing global issues such as renewable energy and climate change. Innovation and new technologies will come out of Los Angeles area research universities and Chinese universities as both places continue to produce some of the brightest talent. Los Angeles County is in a very favorable position to benefit from China’s continued economic rise and to fortify its position as the nation’s leading gateway with China.”
Download a copy of the complete Report
The Growing Together Report has a lot of interesting information in it, including profiles of China-based companies doing business in Los Angeles and Los Angeles-based companies doing business in China, as well as a lot of key facts about China. For a complete copy of the Report click here:
Download the Growing Together — China and LA County Report – June 2014
About JMBM’s Chinese Investment Group®
The lawyers comprising JMBM’s Global Hospitality Group® and Chinese Investment Group® assist Chinese investors with legal and business advice on their investments in the United States. They help Chinese investors identify, analyze, evaluate, validate, acquire, finance and manage hotel and real estate opportunities. This includes due diligence, purchase and sale structure and documentation, development and repositioning of U.S. real estate – particularly hotels, hotel mixed-use, multi-family and commercial real estate.
For more information:
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Jim Butler is a founding partner of JMBM, and the founder and chairman of JMBM’s Global Hospitality Group® and Chinese Investment Group®. He is recognized as one of the top hotel lawyers in the world and has authored or co-authored The HMA & Franchise Agreement Handbook, How to Buy a Hotel Handbook, and The Lenders Handbook. Jim has led the Global Hospitality Group® in more than $87 billion of hotel transactional experience, involving more than 3,900 hotel properties located around the globe. Jim has more than 30 years of experience representing and advising Asian investors, with a particular emphasis on Chinese investors in the last five years given the dramatic increase of outbound investments by Chinese nationals and companies into the United States. +1-310-201-3526 or jbutler@jmbm.comOur Perspective. We represent hotel owners, developers and investors. We have helped our clients find business and legal solutions for more than $125 billion of hotel transactions, involving more than 4,700 properties all over the world. For more information, please contact Jim Butler at jbutler@jmbm.com or +1 (310) 201-3526.
Jim Butler is a founding partner of JMBM, and Chairman of its Global Hospitality Group® and Chinese Investment Group®. Jim is one of the top hospitality attorneys in the world. GOOGLE “hotel lawyer” and you will see why.
Jim and his team are more than “just” great hotel lawyers. They are also hospitality consultants and business advisors. They are deal makers. They can help find the right operator or capital provider. They know who to call and how to reach them.