Mainland Chinese investment in Hong Kong real estate

Abstract

Executive Summary. Over the last twenty years the People's Republic of China has become an increasingly attractive location for overseas investment monies. This inflow of funds, together with a relaxation in the socioeconomic climate, has assisted in the creation of a booming economy, which in turn has generated a large number of cash-rich local companies looking for investment opportunities. The continuation of China's open door policy has allowed such funds to consider investment opportunities outside the mainland, and Hong Kong, a conveniently located market economy, provides both a comfortable environment and an ideal training ground for mainland Chinese enterprises to gain experience in capitalist investment strategies. Since real estate plays a major part in the Hong Kong economy, the Chinese investment funds have also chosen to participate in this sector. In this study, the trend of investment patterns of funds from mainland China and the implications of the involvement of such funds in the Hong Kong real estate market are examined.