Real estate investors buck barriers

The truth is, he continued, in the US, the documents rule -- not the relationships. "Rules are rules and the rules are not flexible," he said. "Government officials have very little ability to bend rules to help businesses make deals."

When making decisions, Chinese investors tend to rely on trust, according to Zhengyu Huang, chairman and founder of ImmCaptial, a Chinese immigration capital service firm.

When asked why they made the investment, the Chinese investors would say "someone I trust invested there and told me to invest", he said.

Shoesmith said rules, not trust, are key to successful transactions. "In China, often business is personal. In the US, business is business," he said.

"I've seen a lot of deals. I've never seen a projection that didn't make money, but not every deal makes money," said Pomerantz. "It's easy to give your money to somebody to buy something. The barrier is how to make money and how when things don't turn out exactly the way the projection shows, which is almost always the case."

In recent years, Chinese companies and individuals have accelerated the pace of acquiring commercial and residential real estate in the United States, owing primarily to its position as the largest, most liquid and most stable market in the world, according to a recent report on Chinese investment in US real estate by the Asia Society and Rosen Consulting Group.

In 2015, direct real estate acquisitions by Chinese investors reached at least $8.5 billion, which represents a compound annual growth rate of 70 percent since 2010, according to the report.

"The one country that has the liquidity, the opportunity and the size to accommodate Chinese interests is the United States, so the long-term destination and long-term perspective is there," said Huang.

"I think they are going to make quite a bit," he said. "It will be a quick learning process. We've seen Chinese investors made mistakes. They learn super quick and they come back stronger."

liazhu@chinadailyusa.com