Better get good at offering business cards with both hands. Judging from the crowds at The Real Deal’s second annual U.S. Real Estate Showcase & Forum in Shanghai, a new wave of Chinese investment is heading to our shores.
Thousands of real estate professionals from New York, Miami, Los Angeles and other major U.S. markets hobnobbed with Chinese investors, homebuyers, wealth managers and brokers at the event, held at the Jing An Shangri-La in Shanghai’s premier business district from Nov. 17-19. More than 40 exhibitors showcased the latest U.S. projects and services, and over the course of eight panels and workshops, attendees learned about the overall real estate investment environment in the U.S., the fate of the EB-5 visa program, buying and maintaining U.S. properties and the development landscape.
On Thursday afternoon, TRD publisher Amir Korangy led a U.S. contingent on a tour of the Hongkou Jewish quarter, which was home to over 20,000 Jewish refugees in the 1930s and 1940s. Cao Liqiang, the governor of Hongkou district, joined the group and later walked them through some of Shanghai’s megaprojects.
The Hongkou Jewish quarter (click to enlarge)
At night, Korangy hosted a VIP dinner at the House of Roosevelt on Shanghai’s waterfront, bringing together top U.S. developers and brokers with Chinese builders and institutional investors. Back at the Shangri-La, Town Residential [TRDataCustom] hosted a cocktail party for event attendees.
On Friday, Korangy stressed the importance of Chinese investors to the U.S. market in his opening remarks.
“There is no more important place in the world for U.S. real estate professionals to make connections than China,” he said, adding that Chinese investors are projected to spend over $200 billion on property investments between now and 2020.
Cocktail party hosted by Town Residential (click to enlarge)
Gov. George Pataki was Friday’s keynote speaker, and stressed to the audience that despite the angry anti-Chinese rhetoric heard during the U.S. election, it would be business as usual.
“Relax, take a deep breath,” Pataki said. “The United States is still the United States.”
Gang Hu, who heads up U.S. operations for Greenland Group, said the U.S. remained the world’s most stable economy.
“The American market is the priority of priorities,” Hu said, adding that education continues to be the primary reason for Chinese to invest in the U.S. Greenland is developing a $1 billion mixed-use project in Downtown Los Angeles, in addition to its partnership with Forest City Ratner on Pacific Park in Brooklyn.
Advocates of the EB-5 program said that under a Trump presidency, the program, which has raised billions of dollars for U.S. developments, would likely be extended long-term and even grow in scale.
“A developer himself, he will magnify the need for a program like this,” said Charles Gargano, an executive director at the U.S. Immigration Fund, the largest EB-5 regional center. Pataki said that though Trump takes a hard stance against illegal immigration, he would encourage legal immigration programs such as EB-5 and “understands the need for capital.”
Nicholas Mastroianni, founder and CEO of USIF, said most instances of EB-5 funded projects falling apart happened outside major cities.
“Urban projects are well-financed, well-publicized, and they get done,” he said.
During a panel with some of the biggest developers in the U.S., the Trump question once again took center stage.
“We are better because of immigration, we are better because of foreign capital,” said Don Peebles of the Peebles Corporation. “If Donald Trump continues to articulate these views, the U.S. Congress will put the brakes on him. One man, and one man with a big mouth, does not change our values.”
HFZ Capital Group’s Ziel Feldman, who launched the second phase of EB-5 fundraising for his condo project at 76 11th Avenue (known as “The Eleventh”) at the event , said the industry had been waiting to have “friendly local governments backed by a friendly federal government.”
“The reality is that our president-elect’s platform is absolutely pro-business and anti-regulation,” he said.
Moderated 2 great panels at @trdny Shanghai event. Packed house. Rabid interest in U.S. real… https://t.co/EL07c7idb5
— Jonathan Miller (@jonathanmiller) November 20, 2016
Kuafu Properties’ CEO Shang Dai said that if U.S. developers honored their commitments to their Chinese investors, the payoffs could be huge.
“In the first run, they just want to come out in one piece,” he said. “As long as they’re still alive, they’re going to go along with you for the next round.”
Nikki Field of Sotheby’s International Realty said that the luxury market correction in New York had buoyed Chinese buyers.
“I think they understand today that there are value opportunities. There are no great deals in New York in particular and definitely no steals. But there is value now.”
Between events, attendees took meetings all over the city, and at night, developers were spotted tearing it up at superclub Mint (notable feature: a shark tank), as well as French hotspot Le Baron. Two New York notables were spotted getting massages on Saturday afternoon, their faces telling of a night of hard partying.
“This Place,” one said, “is ridiculous.”
All photos by Alistair Gardiner for The Real Deal.