Ping An Insurance (Group), China’s second-largest insurer, has formed a $600 million fund with Denver, Colorado-based Blumberg Investment Partners to make real estate investments in the United States. The joint venture has also identified US$400 million worth of other properties for further investment.

The two companies plan to invest in long-term, high-quality US leasing assets. Most of these investments will be in New York City, the metropolitan New York area, central area of the Atlantic coast, northwest of the Pacific coast, Florida, Atlanta, and Colorado.

The investment highlights Ping An’s first step of a strategy to diversify into US logistics properties, after snapping up trophy office towers in major Western cities.

This marks the first significant Chinese outbound investment in the Western logistics sector, according to South China Morning Post.

The current deal is being executed by China Ping An Trust and Investment Co Ltd, a group subsidiary.

“Ping An Trust and Investment has been a pioneer in overseas investments and has abundant experience. We will continue to expand our business operations abroad,” said Zhang Jinshun, chairman of Ping An Trust and Investment.

Blumberg, a property fund, has investments in real estate, energy and resources and other sectors.

The two sides plan to continue to acquire premium properties with a future investment of $400 million. They have indentified some property projects with strategic locations, Ping An said in a statement.

Li Qingxian, general manager of overseas investment division at Ping An Trust and Investment, said: “There are huge business opportunities in US real estate and the partnership with Blumberg indicates our commitment to work closely with leading industry partners.”

“Ping An will continue to seek more investment opportunities in overseas property, and approach suitable institutions and high net worth investors,” he said.

The move is part of the ongoing trend by Chinese companies to acquire overseas properties.

Last year, China’s Anbang Insurance Group Co bought Waldorf Astoria hotel in Manhattan in New York from Hilton Worldwide Holdings Inc. And Ping An Insurance (Group) Co acquired the Lloyd’s of London building from a Commerz Real AG-managed fund in 2014.

The US has become the top destination for investment from the Chinese mainland, followed by Hong Kong, Singapore, Australia and Malaysia, according to a report by Cushman & Wakefield, a global private commercial real estate services firm.

Lu Ming, research manager of Cushman & Wakefield, said part of the reason for Chinese enterprises’ preference for US commercial property targets is that they are optimistic about the US economy.

“We are just seeing the very early stage of Chinese companies buying out overseas properties. In the future, we will see more diversified buyers, including smaller companies,” he said.

Shenzhen-based Ping An, which also operates banking, securities and trust businesses in China, has led Chinese insurers’ overseas buying spree in the last two years, together with top rival China Life.

The two biggest insurers in May agreed to fund part of a US$500 million commercial real-estate project to be built in Boston by US developer Tishman Speyer Properties.

The two have also invested in London’s office sector. Ping An bought Tower Place in the City from Deutsche Asset & Wealth Management for £327 million in its second purchase in less than two years. It bought the iconic Lloyd’s building for £260 million in its first overseas foray in 2013, according to the Post.

Ping An’s move follows a US$4.55 billion deal by Singapore-listed Global Logistic Properties to acquire US warehouses from Industrial Income Trust, which once completed next month, will make it the No 2 US logistics owner, after local giant Prologis.

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