Committee on Foreign Investment in the United States, Real Estate, United States Department of the Treasury, Regulation from

CFIUS Finalizes Regulations on Real Estate Transactions

New Rules Expand CFIUS Jurisdiction Over Foreign Investment in U.S. Real Estate

On January 11, 2023, the Committee on Foreign Investment in the United States (CFIUS) finalized regulations that expand its jurisdiction over foreign investment in U.S. real estate. The new regulations, which will take effect on February 13, 2023, are intended to address concerns about the national security risks posed by foreign investment in certain types of U.S. real estate.

Key Changes to CFIUS Jurisdiction

The new regulations expand CFIUS jurisdiction over foreign investment in U.S. real estate in several key ways.

Expanded definition of "real estate": The new regulations expand the definition of "real estate" to include not only land and buildings, but also other types of real property, such as infrastructure, natural resources, and intellectual property related to real estate.
Lowered filing threshold: The new regulations lower the filing threshold for foreign investment in U.S. real estate from $1 billion to $923 million.
Mandatory filing requirement for certain types of real estate: The new regulations require mandatory filing for foreign investment in certain types of real estate, such as real estate located near sensitive infrastructure or military installations.

Implications for Foreign Investors

The new CFIUS regulations will have significant implications for foreign investors who are considering investing in U.S. real estate.

Increased scrutiny of foreign investment in U.S. real estate: The new regulations will increase the level of scrutiny that CFIUS applies to foreign investment in U.S. real estate.
Potential delays and costs: The CFIUS review process can be lengthy and costly. Foreign investors should be prepared for potential delays and costs associated with the CFIUS review process.
Potential denial of investment: CFIUS has the authority to deny foreign investment in U.S. real estate if it determines that the investment poses a national security risk.

Conclusion

The new CFIUS regulations will have a significant impact on foreign investment in U.S. real estate. Foreign investors should carefully consider the implications of the new regulations before making any investment decisions.

Read the full CFIUS regulations