In 2015, Chinese investment in Australia increased 60% to $15 billion. The second highest level since the peak in 2008, Chinese investors continue to buy real estate and pour resources into healthcare. In fact, Australia ranks second – behind the United States – in appeal for Chinese investors.
Of the overall Chinese investment, $6.85 billion was spent on real estate alone—that’s about 45 percent of the total investment.
KPMG and Sydney University’s joint report, Demystifying Chinese Investment in Australia, documented that most of the real estate investment occurred due to seven “major” deals that were more than $500 million each. In fact, four of those seven deals were over $1 billion each.
Apart from real estate, other sectors favoured by Chinese investors include: renewable energy (20 percent), healthcare (17 percent), mining (nine percent), gas and oil (three percent), infrastructure (3 percent), and agribusiness (3 percent).
Chinese investment in Australia has become the norm and is expected to continue as investors focus on more middle-class consumption industries.
In terms of real estate, Chinese investors tend to focus on longer-term development projects in the residential, office, and retail and hotel space.
While investment in agribusiness was somewhat small, it continues to grow and 2015 saw substantial growth in the beef, dairy, and cotton sectors.
In addition, Chinese agribusiness firms anticipate investment in agribusiness to grow with the China-Australia free trade agreement. It’s also predicted that this agreement will result in a higher valuation of assets and higher prices as it raises the growth expectations for Australian agriculture.
In terms of the locations that directly benefited from the increased investment, New South Wales attracted the most Chinese investment with 49 percent followed by Victoria with 34 percent.
You may also like our recent article, “Is it Still Worth Your Investment to Buy Rural Real Estate in Australia?”
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