Armed with oil profits, two Middle Eastern buyers recently snapped up New York's Chrysler Building and General Motors Building for an estimated $3.7 billion. But their acquisitions of the two trophy properties belies their waning interest in U.S. commercial real estate this year as the U.S. economy stumbles and property prices dip.

Earlier this month, Abu Dhabi Investment Council, one of the world's largest sovereign wealth funds, bought a 75 percent stake in the Chrysler Building for an estimated $900 million. In June, Dubai-based Meraas Capital LLC was part of a joint venture with Boston Properties that bought the General Motors Building for about $2.8 billion.

But Middle East investment is expected to be flat or down this year compared to a banner year in 2007. More than half way through the year, Middle East investors have shelled out $2.7 billion for U.S. assets, according to Real Estate Analytics Inc., a New York-based real-estate research firm. That figure does not include the purchase of the GM building because Boston Properties took a majority position in the building purchase.

But at the current pace, this year's total sales will likely fall far below last year's $8.2 billion in deals.

Other countries have similarly pulled back their investment in U.S. real estate and the disruption in the credit markets has halted many deals. At midyear, sales of office buildings were just a third of last year's total through the first half. Retail property sales were down 62 percent; industrial sales, down by half; and apartment sales, down by 45 percent.

Prices, especially in suburban markets, have started to slip, making many investors jittery about getting into a sliding market. And the economy, on uncertain footing, could hurt property occupancy rates and rents as tenants give back space or scrap expansion plans.

But the current investment conditions have pluses for cash-rich Middle East investors who have been able to grab landmark buildings, which are more likely to hold their value even in a lackluster market.

"They're using this environment to win deals that they might not have won last year," said Dan Fasulo, managing director of Real Capital Analytics. He pointed out that the Chrysler Building would have gone to an investor armed with easy financing if the deal had occurred the same time last year.

These investors are zeroing in on New York City, which accounted for nearly a quarter of all office sales in the first half of the year.

New York ranked as the top spot worldwide for foreign commercial real estate dollars, according to a survey conducted in the fourth quarter of last year, up from No. 2 the year before. The survey was released in January by the Association of Foreign Investors in Real Estate.

So far this year, property prices have more than held up in Manhattan. The average price per square foot for a Manhattan office is $877, up 24 percent from $705, according to Real Estate Analytics.

"There's a notion it's a safe haven, that markets like New York City are ultimately going to retain their value," said Joseph Gulant, partner at law firm Blank Rome LLP, which helps negotiate commercial real estate deals.

Gulant expects property values in such cities as Chicago, Houston and San Francisco to weather the commercial real estate slowdown better than others and will continue to draw foreign interest.