Chi­nese in­vestors ze­ro­ing in on LA

China Daily (Canada) - - SHANGHAI - By WU YIYAO in Shang­hai wuyiyao@chi­nadaily.com.cn

Chi­nese in­vestors in Los An­ge­les have a pos­i­tive out­look for business next year, and about 90 per­cent of business own­ers polled are look­ing for­ward to ex­pand­ing their busi­nesses in 2015, ac­cord­ing to a re­port re­leased by China Trust Bank USA (CTBC) in Shang­hai Tues­day.

The re­port is based on a survey of 460 Los An­ge­les business own­ers whose com­pa­nies ranged in size from small en­ter­prises to those with bil­lion-dol­lar rev­enue.

About 60 per­cent of polled business own­ers said they be­lieve their prof­its in 2015 will in­crease over 2014, and 90 per­cent said they were look­ing to ex­pand their business.

Bank­ing in Los An­ge­les has ben­e­fited from dou­ble-digit growth in Chi­nese in­vest­ment in the Cal­i­for­nia mar­ket, in­clud­ing com­mer­cial and res­i­den­tial real es­tate and com­mer­cial bank­ing, said Noor Me­nai, pres­i­dent and CEO of the bank.

Me­nai said the bank wit­nessed a 60 per­cent growth in trade fi­nance loans in 2014 year-to-date, fi­nanc­ing in­ter­na­tional trade trans­ac­tions pre­dom­i­nately in the Pa­cific Rim, mostly in China and other Asian mar­kets.

In­creas­ing in­vestors com­ing to Los An­ge­les from China also beefed-up de­mand for home loans, said Me­nai.

Among CTBC’s Chi­nese clients, many have ap­plied to a global res­i­den­tial mort­gage pro­gram, which caters to for­eign bor­row­ers or new im­mi­grants who are still es­tab­lish­ing a credit his­tory in the US.

“A to­tal of 89 per­cent of th­ese bor­row­ers that re­side out­side of the US are from China and Hong Kong,” the re­port said. “Res­i­den­tial bor­row­ers from China’s main­land re­al­ized a 37 per­cent growth in 2014 year-to-date.”

Mar­ket in­sid­ers said Chi­nese in­vestors have been play­ing a more sig­nif­i­cant role in Los An­ge­les real es­tate.

Be­tween 2007 and 2013, the per­cent­age of Chi­nese in­vest­ment in the Los An­ge­les metro area av­er­aged only 9.6 per­cent, ac­cord­ing to Lewis Horne, pres­i­dent of the Greater Los An­ge­les-Orange County Re­gion for CBRE Inc, a com­mer­cial real es­tate company head­quar­tered in Los An­ge­les.

“Year-to-date in 2014 it has been 16 per­cent, which equates to a sig­nif­i­cant rise in to­tal in­vest­ment value — from an av­er­age of $106 mil­lion per year in the past six years by 2013 to $748 mil­lion in 2014,” Horne said.

Chi­nese in­vestors have not only been in­vest­ing more heav­ily but also in­vest­ing more widely in the past decade, said Horne.

“In the 2000s, we saw Chi­nese were only in­vest­ing where Chi­nese work and live and in some val­ueadded ar­eas such as hous­ing and ho­tels. Now they are en­ter­ing core ar­eas and more types, such as of­fice build­ings, in­dus­trial prop­erty and com­mer­cial,” says Horne.

Mary Leslie, pres­i­dent of the Los An­ge­les Business Coun­cil, said Chi­nese in­vestors are eye­ing var­i­ous in­vest­ment op­por­tu­ni­ties in the city.

En­ter­tain­ment, phar­ma­ceu­ti­cals, clean en­ergy, re­tail and man­u­fac­tur­ing are all ap­peal­ing to Chi­nese in­vestors, said Leslie.

“In terms of wind en­ergy, so­lar en­ergy and a se­ries of clean en­ergy tech­nolo­gies Chi­nese in­vestors are lead­ing,” said Leslie.

GAO ERQIANG / CHINA DAILY

The port in Shang­hai FTZ saw a boom in for­eign trade this year.

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