The West has always attracted affluent people from around the world. Europe has become a cardinal playground for the young and wealthy, and a pool of opportunity for the businessmen. But what do these high net worth individuals invest in?
Wang Jianlin, a Chinese property tycoon (according to the Hurun Report, is the richest man in China), has his eye on the European and American entertainment industry. Having already bought the American movie-theatre heavyweight AMC Entertainment Holdings Inc. for the sum of $2.6 billion, Mr Wang plans to concoct a Chinese version of the Oscars in the city of Qingdao.
The Dalian Wanda Group Corp, Mr Wang’s property conglomerate has also announced a target of $40 billion, almost twice last year’s $23 billion. ‘There are also plans’ says the Chinese entrepreneur ‘to increase the global awareness of Dalian Wanda Group’. He plans to open luxury hotels in 8 out of 10 world’s major cities. To date, Wanda owns 38 five-star hotels, 71 shopping plazas, 57 department stores and 6,000 cinema screens across China.
Some acquisitions by big buyers can even have political connotations. For example, at the end of December 2012, the Committee on Foreign Investment in the United States approved the takeover of one of the leading American human genome sequencing companies, Complete Genomics. This decision was heavily criticized by some analysts as posing a threat to national security as well as to the competitiveness of American companies in the field of DNA sequencing.
However, it is not always straight forward for the wealthy individuals if they consider investment in Europe. Huang Nubo, a Chinese real estate developer, has spent nearly two years trying to secure land for a tourist resort in Grímsstaðir á Fjöllum, a settlement in Iceland. According to Bloomberg, in November 2011, the purchase of the 300km2 plot, at around $260 per hectare, was blocked by the government.
A 1966 law essentially forbids foreign entities from buying land in Iceland. While these restrictions have been eased for buyers from EEA countries, Huang’s purchase plans still required the interior ministry to grant an exemption. In his 2011 decision, minister Ögmundur Jónasson said the plot’s sheer size (0.3% of Iceland’s land area) put such an exemption at odds with the spirit of the law. The good news for Mr Huang, he has received some positive signals from the new government that they are ready to review investment laws so he could finally complete the deal.
