New Kids on the Block? Analyzing the Changing Geographies of Greenfield-Real Estate FDI (GREFDI) Between 2003-2014

As the world witnesses the emergence of a new transnational wealth elite, of which a substantial part originates from ‘developing’ countries, the geographies of Foreign Direct Investment (FDI) generally seem to experience... [ view full abstract ]

As the world witnesses the emergence of a new transnational wealth elite, of which a substantial part originates from ‘developing’ countries, the geographies of Foreign Direct Investment (FDI) generally seem to experience a remarkably shifting pattern. Large sums of money are increasingly invested from or in places that can be regarded as relative newcomers in this particular arena. Real estate is one of the most striking sectors that has experienced a spectacular growth in this regard. This paper specifically focuses on the changed geographies of ‘Greenfield Real Estate FDI’ (GREFDI), which thus widely refers to newly-established transboundary operations in the real estate sector. Using a dataset from fDi Markets that covers a period from 2003 to 2014, we descriptively analyze and evaluate the shifting global order in terms of this particular type of investment.

Our results indicate that Middle Eastern countries such as UAE, Bahrain, Kuwait and Qatar, are appearing amongst the dominant source countries, alongside ‘emerging’ economies in Asia (China and Malaysia) as well as a number of ‘developed’ Western nations (USA, UK and Australia). While GREFDI thus increasingly takes place on a global scale, the aforementioned sources’ investment patterns reveal that ‘they’ mainly invest in culturally- or geographically proximate countries. Popular GREFDI-destinations of companies from the aforementioned Arabian Peninsula countries namely are Iraq, Libya and Tunisia, while large real estate projects in China are particularly facilitated by investors from Singapore and Hong Kong. Other main GREFDI-destination countries include Romania, Poland and Russia, which mainly attract investments from Western Europe. By using an Economic Geography perspective, our paper provides a coherent and complete overview of the countries, cities, and companies that have been active on the GREFDI-stage during the early 21st century, while highlighting a number of what we perceive as the most-striking newly emerged patterns.