DeSantis Doubles Down on Chinese Real Estate Investment Ban
Amendment to narrow the 2023 act was introduced this week in state Senate
By Chava Gourarie February 23, 2024 2:19 pm
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An attempt to roll back a controversial law banning Chinese real estate investment in Florida has Gov. Ron DeSantis on the defensive.
Earlier this week, Florida’s state Senate introduced an amendment to Senate Bill 814 that would narrow the restrictions in last year’s Conveyance to Foreign Entities Act, which prohibits individuals and entities from seven countries “of concern” from owning or purchasing certain types of property in Florida.
The bill, which DeSantis called a crackdown on the Chinese Communist Party, has been criticized by the real estate industry for its scope and challenged in court on constitutional grounds for its indiscriminate ban on Chinese investors and other nationals with no connection to their governments.
“What I see going on now is an attempt to unwind what we’ve done to protect Floridians against the threat posed by China,” DeSantis said at a press conference Thursday.
The original 2023 act barred people and entities from China, Russia, Iran, North Korea, Cuba, Venezuela and Syria from buying land in Florida located near military bases or infrastructure sites, with further restrictions on Chinese principals.
State Sen. Clay Yarborough, a Republican from North Florida who added the amendment, emphasized that the changes would not roll back the original measure, but would address unintended consequences and concerns about its impact. That includes defining the role of passive investors and carving exceptions for Chinese individuals who are not linked to the Chinese government.
“Ownership restrictions are retained for governments, government entities and foreign corporate entities of concern,” said Yarborough during a committee discussion on the amendment. “Individuals granted asylum or having a U.S visa for purposes other than tourism can purchase and own land subject to ownership restrictions.”
The issue of minority investors is of greatest concern to the real estate industry, since it could prevent institutional actors and real estate investment trusts with diverse investor bases from investing in the state. While the original law does exclude buyers with a noncontrolling or de minimis interest, the law’s language is vague on how the law will be applied or enforced.
“A passive partner does not pose a threat to national or state security,” Yarborough said. “They merely provide financing. They have no input on the design, construction or day-to-day activities of residential home building.”
The bill, which primarily addresses issues other than the foreign investment, is now headed to the Senate floor for a vote. A similar House bill was advancing without the China ban language. Both House Speaker Paul Renner and Senate President Kathleen Passidomo have expressed support for the change, according to reports.
That’s despite DeSantis’s disapproval, which comes as he’s facing broader pushback from his own party. Both the House and Senate are poised to pass a social media ban for minors 16 and under, despite the governor’s threat to veto it.
“This is the first time now in at least three years where we’ve started to see the Florida Legislature push back in a meaningful way against Ron DeSantis,” said Jason Garcia, a reporter and podcaster who covers the legislature daily.
“This looks like another area where the legislature might be willing to ignore Ron DeSantis again, and dare him to veto it and risk getting overruled again.”
On the legal front, a judge ruled in favor of two plaintiffs challenging the law last month, preventing its enforcement while the challenge progresses through the courts.
Chava Gourarie can be reached at cgourarie@commercialobserver.com.
