Chinese Exodus from U.S. Real Estate Accelerates With Sale of L.A. Site
Chinese conglomerate Dalian Wanda Group has agreed to sell a glitzy development site in Beverly Hills, Calif., the latest sign that Chinese companies are bailing out of U.S. real estate after years of loading up on these properties.
A venture between London-based real-estate firm Cain International and Alagem Capital Group has agreed to purchase the eight-acre site, Cain’s chief executive officer, Jonathan Goldstein, said. The buyers have agreed to pay more than $420 million, according to a person familiar with the matter.
Brokers say the property, an empty lot that Wanda dubbed as One Beverly Hills, is one of the premier development sites in the Los Angeles area. The Wilshire Boulevard parcel is located near Rodeo Drive and Century City, and it already has entitlements for hotel and condominium development.
Wanda purchased the eight-acre parcel in Beverly Hills in 2014 for $420 million during a global expansion spree. The company had planned to develop a luxury residential building and boutique hotel on the site, but feuds with a local union and contractors stalled progress. Wanda put the property up for sale early this year as its debt mounted.
Based in Beijing, Wanda owns cinemas, real estate and many other businesses in China. In recent years, the company has acquired interests in U.S. real estate, including a controlling stake in Vista Tower, a skyscraper in Chicago currently under development.
The firm has had ambitions to become a global entertainment powerhouse. In 2016, Wanda acquired film and media company Legendary Entertainmentfor $3.5 billion in cash, though it recently sold part of its stake in AMC Entertainment Holdings Inc. as part of its broader retreat from the U.S. market.
The company, along with other high-profile Chinese investors, has been offloading U.S. trophy properties following pressure from Beijing to curtail certain types of overseas investments, including real estate.