New York City skyline under attack by foreign investors?

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Another American icon gobbled up by oil-rich overseas investors? Apparently so: An Abu Dhabi sovereign wealth fund bought a controlling stake in the Chrysler Building, a fixture of the Manhattan skyline that was the world's tallest building until 1933. The purchase was the second acquisition of a New York landmark by a Middle Eastern fund in little over a month, a trend that may continue:

Investors from the region have been a force in New York real estate for some time, rivalling Europe for the dollar volume of their investments in recent years.

Now many in the industry say they have seen increased interest from the Middle East, especially in top assets in major US cities such as New York, LA, Washington and Boston, as oil prices soar, the dollar remains weak and building values soften or fall.

Many Americans find sovereign wealth funds confusing (a particularly unfortunate typo in today's Washington Post Express citing "Abu Ghraib investors" behind the Chrysler deal probably doesn't help). But should we really be all that worried?

As Anders Åslund wrote in an FP Web exclusive last December, the short answer is no. According to Åslund, Americans and Europeans have nothing to fear. Soverign wealth funds are actually a "lousy bargain" for the citizens of the investor countries themselves, he writes.

Purchases such as the Chrysler Building may be a public relations boon for foreign investors, but similar forays into American icons such as Pebble Beach and Rockefeller Center in the 1990s proved to be busts. If past is prologue, Abu Dhabi may come to regret this vanity investment.