Corruption brings in money
Vancouver has lead in price if not volume I believe
Of course it has....
Chinese police agents have been conducting secret operations in Canada â€” a top destination for allegedly corrupt officials â€” seeking to â€œrepatriateâ€ suspects and money laundered in real estate.
CHINESE WEALTH FOCUSING ON COMMERCIAL REAL ESTATE
A â€œstaggeringâ€ amount of Chinese wealth that has poured into Vancouver homes since 2011 is increasingly flowing into commercial real estate deals, realtors say.
Colliersâ€™ Spark Report says the global outflow of Chinese capital hit a record of $18 billion in 2014, and the amount flowing to Canada and specifically Vancouver is rising.
The report notes several â€œlandmark dealsâ€ made by Chinese investment funds in the past year including a 232-acre Port Moody development site on which Chinese investors want to build an â€œurban village.â€
Kirk Kuester, executive managing director of Colliers International Vancouver, said the pool of money from Mainland China seeking investments in Metro Vancouver is so vast right now that he has to turn away potential clients.
â€œThe money is staggering, quite honestly,â€ Kuester said.
â€œIt is essentially from Mainland China. They were looking at private houses in residential developments in Vancouver, and it really seemed to accelerate in mid-2013. Itâ€™s a security play, and a diversification play.
â€œBut now we are seeing them look for cash flow from commercial sites. The biggest challenge we face is scale and process.â€
Kuester said a range of Chinese investors â€” from state-backed funds to smaller players with just tens of millions â€” expect to quickly ink deals for land by offering sky-high bids. But they are sometimes frustrated by the politicized nature of development deals in Vancouver, and multi-bid processes.
Kuester said, for example, that on Wednesday he had two or three potential clients with â€œhalf-a-billionâ€ in private funds ready to put to work, but there are simply not big enough deals to satisfy them.
â€œSome of these groups want to buy the biggest sites in the city and do developments that are comparable to projects in China, but would be on the upper end of anything ever done here,â€ Kuester said.
Dan Scarrow of Macdonald Realty Ltd. also said massive interest from China buyers in high-end Vancouver area neighbourhoods is â€œshifting more now towards commercial real estate.â€
Vancouver city officials will not comment on co-operation with Chinese agents in â€œOperation Fox Hunt,â€ or on suspects pointed to by Chinese news services.
Xinhua news agency reported that while China does not have extradition treaties with Canada, the United States and Australia â€” the three top destinations for corruption suspects â€” in 2013 Canada and China signed an agreement to share assets connected to corruption.
Starting in 2014, Chinese agents came to Canada and other countries, Xinhua reported.
The Province found indications in various data sources of large wealth allegedly misappropriated in China and invested in condo and commercial developments and private residences in and around Vancouver.
Also, according to The Provinceâ€™s review of data posted by the International Consortium of Investigative Journalists, there are a number of offshore shell companies linked to addresses in Vancouver, West Vancouver and Richmond, with connections to Mainland China.
City Manager Penny Ballem was asked if Vancouver officials are taking any actions against money laundering.
â€œIn terms of corruption and money laundering, I can tell you in my conversations with (Vancouver Police Chief) Jim Chu, and the provincial solicitor general, these things are always a challenge for all levels of government,â€œ Ballem said. â€œIf you want any hard information, you need to talk to Jim Chu.â€
Chu was not made available for an interview.
â€œThe Vancouver Police (Department) works closely with a variety of other police agencies, including Interpol,â€ VPD spokesman Const. Brian Montague said. â€œUnfortunately we would not be able to discuss specific cases or suspects.â€
Postmedia News reported that in his new book David Mulroney â€” a former senior adviser to Prime Minister Stephen Harper and ambassador to China from 2009 to 2012 â€” argues that Canada needs to take measures to block the influx of â€œhot moneyâ€ pouring into real estate, and could go â€œmuch furtherâ€ to co-operate with China in Operation Fox Hunt.
â€œThe U.S. and Canada are key targets for (Operation Fox Hunt) investigators. Both places are popular with corrupt officials because both are highly desirable locations in which to house family members and educate children, and neither has an extradition treaty with China,â€ Mulroney wrote.
A report from Chinese wealth research firm Hurun says that 64 per cent of Chinaâ€™s millionaires have emigrated or plan to emigrate soon, to the U.S., Europe, Canada and Australia.
The financial news network CNBC reported that analysts believe an unstated reason for the flight of wealth from China is the Chinese Communist Partyâ€™s aggressive corruption crackdown.
â€œThere is huge money laundering coming into Vancouver, but I donâ€™t know who would tell you on the record, because that would be slitting their own throats,â€ one source said.
Cases of high-profile fugitives sent back to China from B.C. include Lai Changxing, the alleged mastermind of a billion-dollar smuggling operation in China, who was returned to Beijing in 2011, and Li Dongzhe, who turned himself over to Beijing officials in 2012 after hiding out in North Vancouver for six years.