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Real estate group concerned about Florida land law
A national group of real estate executives this week expressed concern about a new law that restricts people from China from owning property in Florida, urging steps to make sure it “does not deter investment into real estate in the state or undermine the economic benefits of this important industry.”
The Real Estate Roundtable sent a letter Tuesday to Patricia Fitzgerald, chairwoman of the Florida Real Estate Commission, after Associated Industries of Florida offered similar concerns in July.
The law (SB 264), signed by Gov. Ron DeSantis in May, limits land ownership by people from what Florida calls “foreign countries of concern” — China, Russia, Iran, North Korea, Cuba, Venezuela and Syria, with part of it specifically focused on Chinese people who are not U.S. citizens or permanent U.S. residents.
The Real Estate Roundtable letter pointed to investment funds that are controlled by U.S. managers but often draw money from foreign “passive” investors, including Chinese investors.
“Our concern with the new law is that these U.S.-managed investment funds, which are controlled and managed by U.S. nationals, may now be precluded from pursuing investment opportunities in Florida if there is any level of investor participation in the fund from countries of concern like China,” Jeffrey DeBoer, president and CEO of the group, wrote. “Based upon feedback from our members, the new law has served as a significant impediment to further investment in Florida real property, and is likely to impact Florida real estate markets. We do not believe that this was the intent when enacting the new law, and do not consider this outcome to serve the national security-focused policy objectives of the legislation.”
The Florida Real Estate Commission is helping to carry out the law. Tuesday’s letter offered a series of suggestions for how the law should be interpreted.
“We suggest clarifying that, notwithstanding any alternate interpretations, any investments that do not constitute a ‘controlling interest’ and are managed by an investment adviser registered with the U.S. Securities and Exchange Commission are permissible,” the letter said.
Four Chinese people and a real estate brokerage have filed a federal lawsuit challenging the constitutionality of the law and seeking an injunction. U.S. District Judge Allen Winsor refused to issue an injunction, with the issue now at the 11th U.S. Circuit Court of Appeals.
