China’s state-owned Anbang Insurance Group Co. Ltd. agreed to buy New York City’s landmark Waldorf Astoria Hotel from Hilton Worldwide Holdings Inc. for $1.95 billion on Monday, reports Forbes. The deal sets dual all-time records: the largest acquisition of US real estate by a Chinese buyer and the most expensive purchase of a US hotel.
The Waldorf Astoria will remain under Hilton management for the next 100 years and will soon undergo renovations to preserve its art deco features, according to Hilton’s press release. In addition to its 1,413 rooms, the hotel houses event space, restaurants, and shops.
Hilton plans to use the proceeds from the sale to purchase other hotels in the United States.
After China loosened overseas investment restrictions in 2012, Chinese real estate buyers—first private and now state-owned entities like Anbang—began acquiring trophy assets like the Waldorf in large US cities to capitalize on famous brands and to gain easier access into large US and foreign cities.
Real estate analysts say these investments will likely continue until the US real estate market shows signs of weakening or until China’s market begins producing more quality investments of its own.