Foreign Bets on US Real Estate

Business Week reports that foreigners bought $37.7 billion worth of commercial property in the United States in 2006. Investment in Manhattan was a 60.4%; Boston 450.2%; and Chicago 80.4%.

No doubt they overpaid, but these purchases represent only about 5% of the balance of trade deficit. Could this be leading to a repeat of the foolish Japanese real estate spending spree in the 1980s?

See Arndt, Michael. 2007. “An Office Party.” Business Week (12 March): p. 16.

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