TAIPEI, Taiwan (TheStreet) -- Like the Japanese before them, big Chinese companies are increasingly becoming property owners in the U.S. and other countries.
Major Chinese conglomerates, once largely unknown outside of their home country, have invested in everything from golf courses in Myrtle Beach, S.C., to British automaker MG Rover, which Shanghai-based SAIC Motor acquired in 2007.
Overseas investment is growing because Chinese companies want to escape economic uncertainty and competitive pressure in their own country. The companies also are developing more of a multinational profile, offering capital to foreign firms and shoring up stocks on both sides.
These ventures, usually involving land use, unlock the ambitions of the Chinese firms. They can escape supply gluts, inflation and regulatory or market uncertainty in China while diversifying their businesses and sources of financing.
"The government is happy to see some investment leave China, as this removes some of the inflationary pressures and oversupply," said James Macdonald, head of Savills Research China, speaking on the heavily Chinese-invested offshore real estate sector.
Foreign partners of the Chinese investors get otherwise hard-to-find infusions of capital, plus exposure to the growing China market if they want to approach it someday. Chinese investment may also stimulate overseas property markets, and in countries such as Indonesia, create entire supply chain clusters with spinoffs into raw materials or the service sector.
Chinese overseas direct investment went from a total of $2 billion to $14 billion between 2004 and 2005, marking the start of the current trend. By 2013, it had reached $163 billion. More than 13,500 Chinese investors have parked capital in 177 countries, but top destinations over the past two years have included Japan, Singapore, the United Kingdom and the United States.