Hawaii’s Real Estate Market
The Hawaii real estate market has become increasingly attractive to Chinese investors, and this is most apparent on the island of Oahu. Towns such as Honolulu, Kailua and Kapolei – all of which are popular holiday destinations – have been witnessing significant investment from wealthy Chinese.
The Chinese have always loved visiting Hawaii, and new marketing campaigns aim to highlight the healthy and happy lifestyle that residents can enjoy all year round. Hawaii offers stunning natural beauty and a relaxed way of life that is vastly different from the cities of China, and let’s be honest, who wouldn’t want to live here? Tourism arrivals to Hawaii are rising every year, so it should come as no surprise that many Chinese investors are turning to real estate to grow their investment portfolio.
Why Invest In Hawaii?
The main reason why Chinese investors love to invest in Hawaii is due to its strategic location. Located in the middle of the Pacific Ocean and only a short flight from the USA mainland, Hawaii is an ideal base for investors looking to strengthen business ties with the USA and Asia Pacific. The relative scarcity of Hawaiian real estate is also another driving factor, as this helps to keep the property market strong and ensure stable price growth. The thriving tourism industry is icing on the cake, as the constant influx of tourists spending on luxury hotels, goods and services guarantees a steady return well into the future.
Chinese Investments
Many of the Chinese investors are opting for real estate, but commercial properties are also proving to be very popular. In April 2017, Chinese investors purchased an acre of property located nearby to Ala Moana Center, and they have plans to build a 407 unit condominium hotel. This will be a mixed-use property, as it will contain a mix of permanent residents, hotel guests as well as commercial space/shops. This shows that the Chinese are also interested in establishing businesses in Hawaii, as it may make them eligible for a green card if their ventures create at least 10 new jobs for U.S. citizens.
Oceanwide Resort HI LLC is also leasing about 9,000 square feet of space in Downtown Honolulu. They are a subsidiary of a Hong-Kong based investment group, and they are responsible for the flurry of real estate sales in recent times. We can expect the real estate boom to continue now that they have local office space, and this is a clear indication that the Chinese are taking things seriously. More than $1 billion has been spent by the Chinese over the past year on some of Hawaii’s most prestigious properties, and there’s no sign of anything slowing down.
The Chinese prefer to invest in Honolulu, as it is receives the most attention from mainstream media and is one of the first places that comes to mind when planning a holiday. They value investments that offer stunning waterfront views and are close to major amenities such as schools, universities and shops. They are also concerned about any potential dangers such as lava flows, which makes areas such as Pahoa unsuitable for investment.
China Oceanwide
Long term Hawaii residents have probably never heard of a group known as China Oceanwide, but they will soon become a household name. Headed by Chinese billionaire Lu Zhiqiang, this group is responsible for the purchase of about $569 million worth of real estate in West Oahu - and they have big plans for the future. Not only do they want to build a massive 1,300-unit resort, they also plan to build two more luxury hotels as well as residential properties. A company spokesman has stated that one of their main goals will be to achieve investment returns as soon as possible, so it’s likely that construction will soon begin. The group also continues to identify new opportunities, so it’s worth keeping an eye on the media to see what their next move will be.
Summary
Hawaiian real estate is hot property for Chinese investors, and there is no shortage of cash to be splashed. There have been concerns about Hawaiian residents being priced out of the market due to foreign investment, so it will be interesting to see whether these new residential developments will help to alleviate this issue or make it worse. One things for certain, and that is that Hawaii will be undergoing some major changes due to Chinese investment. New luxury hotels, shopping centers and master planned communities are all on the horizon - let’s hope they benefit us all. As always, if you’re in need for any homes for sale in Hawaii, please contact me and I’ll see what I can do to help. Mahalo - Kimi
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