The rumors of last spring are confirmed, and the U.S. trade policy has claimed another U.S. casualty, and this time it's a pretty large one: Another Chinese Mega-Construction Project in California Is Halted, this one in San Francisco. List of Troubled or Scuttled Chinese Projects in California Grows.
The tsunami of Chinese money that washed ashore on the West Coast, and particularly in real estate in California, between 2014 and 2016, and that has done so much to inflate the commercial real estate bubble and the housing bubble, has now receded. And what is left to do is to sort through it all and figure out how to go on from here.
It's not the only project that Oceanwide is abandoning: Genworth's $3.8B Takeover By China Could Be Next Victim Of The Trade War
Nothing worked out as planned. U.S.-China political and trade tension ratcheted up as President Trump implemented a hardline approach on Chinese investments in the U.S., and China responded with retaliatory tariffs. China Oceanwide faces mounting debt problems at home and concerns about whether it can meet its funding promises to Genworth with Chinese regulators cracking down on capital outflows.
Hiring has stopped: Bay Area unemployment rates at record lows – and hiring is slowing
The nine-county region added 800 jobs last month, which turned out to be the first time in a year that the Bay Area’s monthly job gains were below the 1,000 level, according to data from the state Employment Development Department.
There are vacant buildings in SoMa, just blocks from the headquarters of previously sky-rocketing companies such as Slack, GitHub, CloudFlare, and DropBox (the last of which recently abandoned downtown for significantly cheaper digs in Mission Bay, near DogPatch). "Office transactions totaled $532.1 million year-to-date through August, down 79.1 percent from the same period in 2018, as half of the 33 deals completed were value-add plays.",
WeWork is near bankruptcy, AirBnB has pushed their IPO attempt out to 'sometime in 2020'.
It now seems certain that the amazing 10-year run of boom times in San Francisco is over.
In addition to the halting of investment from China, one has to wonder about the other major change, the halting of immigration visas: The Trump Administration Is Denying H-1B Visas at a Dizzying Rate, But It’s Hit a Snag
While President Donald Trump’s crackdown on undocumented immigrants has grabbed public attention, his administration has been dismantling the work-based immigration system as well. In April 2017, Trump issued the Buy American and Hire American executive order, which he promised would reform the high-skilled immigration program to “create higher wages and employment rates for workers in the United States.” Since then, US Citizenship and Immigration Services (USCIS) has been denying and delaying record numbers of H-1B visa petitions. The denial rate for first time H-1B applications went up from 10 percent in 2016 to 24 percent in 2019.
Nothing lasts forever, of course, but it is stunning to see how rapidly U.S. policy changes managed to stop the booming economy of the mid-2010's dead in its tracks.
Well, on we go.
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