Although the United States has typically been recognized as the world’s largest economy, recent years has proven that the real estate industry has more than enough room for growth. Foreign investment has been a popular way that real estate hubs like Los Angeles and New York City have rapidly expanded. In reality, foreign money makes up approximately 10 percent of all commercial property investment capital in the United State. The Downtown Los Angeles skyline may see quite a few changes in the very near future.
Recently, Asian investors have found placing funds in U.S. property to be the best way to diversify their portfolios. As the Chinese real estate bubble gradually deflates, placing investments in the U.S. market offers a secure, wealth-building advantage.
Downtown LA has been the recent point of interest among East Asian countries in general. The city of Los Angeles provides a tax break incentive for foreign investors, encouraging them to schedule large-scale, long-term development projects. One of the largest projects in the works is projected to generate upwards of $117 million in revenue over the next 25 years. The LA Skyline in particular will be targeted by ultra luxe, economy stimulating projects.
The Hanjin Group, a South Korean construction and renovation group will take on the Wilshire Grand Tower in the Financial District, incorporating a 73-story hotel and office building with 5 levels of parking. The new building will stand over 1,000 feed tall, making it the tallest building west of Mississippi. Shanghai-based developer, the Greenland Group, has begun construction on the Metropolis. Located close to the Staples Center, the Metropolis will be completed by 2016 and include 38 stories of residential units, retail and office space, and a 19-story hotel.
This high volume of international invested is sure to not only improve the Downtown LA area, but also promote diversity and multiculturalism in the city. Although LA is already diverse, foreign investors will likely attract an even larger pool of untapped demographic.