Real estate mogul Grant Cardone recently sparked a heated debate when he tweeted that China should not be allowed to purchase U.S. real estate unless they partner with a U.S. entity. "You want to invest here, partner here," he stated.
Cardone's statement reignited concerns about foreign ownership of American land, particularly by China, which has been under increased scrutiny recently.
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While Cardone's tweet zeroed in on China, foreign ownership of U.S. land is nothing new. According to the 2021 USDA report, foreign entities own about 40 million acres of U.S. agricultural land or roughly 3% of privately held farmland.
Among these, Canada leads with 12.8 million acres, far outpacing other countries. China, on the other hand, ranks 18th, owning approximately 384,000 acres. While this is more land than the 248,000 acres that billionaire Bill Gates owns, it's not much compared to Dutch or Canadian holdings.
The top 10 countries for 2021 look like this:
- Canada (12,845,000 acres)
- Netherlands (4,875,000)
- Italy (2,703,000)
- United Kingdom (2,538,000)
- Germany (2,269,000)
- Portugal (1,483,000)
- France (1,316,000)
- Denmark (856,000)
- Luxembourg (802,000)
- Ireland (760,000)
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Why the Controversy?
Many view China's investments in U.S. farmland and real estate as a potential national security risk. According to Forbes, in 2021, a Chinese company wanted to build a corn mill near an Air Force base in North Dakota, but lawmakers stopped it because they were worried about spying. This and other tensions like trade issues and concerns about Chinese surveillance balloons have made people more nervous about why China is buying U.S. land.
What Does China Own?
Of the Chinese-owned U.S. farmland:
- According to NPR, over a third is controlled by Smithfield Foods, the U.S.'s largest pork producer, which was acquired by China's WH Group in 2013.
- Around 40% is held by Sun Guangxin, who purchased over 100,000 acres in Texas for a wind farm project that was ultimately halted due to security concerns.
- Smaller portions are managed by Walton International Group, which represents multiple global investors.
Critics argue that while China's share of U.S. farmland is small, the concentration of these holdings near sensitive locations poses significant risks. "What's missing here is a lot more information about where these specific locations or farmland purchases are located in close proximity to the military base," said Craig Singleton from the Foundation for Defense of Democracies.
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A Legislative Push
Lawmakers across party lines call for stricter rules to limit or monitor foreign ownership of U.S. land. They've introduced bills like the FARM Act to make ownership more transparent and to limit buying land close to vital infrastructure like military bases. The Biden administration also considers changing the rules for buying land close to these sensitive areas.
However, the system for tracking foreign land ownership is flawed. The USDA relies on self-reported data, which is often outdated and incomplete. Due to funding delays, recent efforts to modernize reporting through an electronic filing system remain stalled.
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