Chinese Sovereign Wealth Funds Look to US

The WSJ is reporting that China’s SWF, China Investment Corporation, is seeking to place bets on the US Real Estate market. To that end, they’ve held discussions with managers BlackRock, Invesco, and others.

The estimates in the article peg allocation in the range of $4-20B, but that is just a drop in the bucket of the amount of troubled debt which looms over the head of office, retail, hospitality, and other real estate assets.

Even if you assume they pick up assets at forty cents on the dollar, that would peg the original valuation at $10-50B, a bit better, but still not a big enough solution.

Ultimately though, what I find most interesting, and comical about the sovereign wealth funds though is who they are selecting to sponsor. They are going after the Morgan Stanleys, BlackRocks, and Tishmans of the world. My question is who are these guys going to be acquiring assets from, themselves?

These are the same groups that failed to see any farther than their fees the last go around and have lost or stand to lose billions from those deals. Go down the list of the biggest CRE money managers, whether its Carlyle, BlackRock, Blackstone, Morgan Stanley, RREEF, Tishman, etc. and look at the deals they’ve done.

Granted, I’m sure they all have funds that have done well in the past, but it’s hard to ignore the decisions that were made over the past several years.

This all reminds me of that old Texas-Tennessee saying:




[via WSJ]

Similar Posts:

• MSREF VI Shows Us How To Lose $5.4B
• GS Whitehall Funds Down to Last $30M … From $1.8B!
• Who Are The Largest Firms Investing Internationally For US Clients? Here’s The Top 10
• Update on Morgan Stanley and Crescent Real Estate Deal
• Who Do Foreigners Give Their Money To When Investing In US Real Estate? Here’s The Top 10

Comments

Lawrence April 20, 2010

george bush is the smartest of todays republicans

Leave a comment