The below is an article written by Mauricio Umansky that appears in the Winter 2012 issue of Beverly Hills Magazine.
Over the past few years, I visited multiple countries overseas but I had not yet visited China. Due to the overwhelming increase in Los Angeles real estate sales to foreign buyers, I decided that it would be important to visit a country that now accounts for 9% of foreign purchases in the luxury real estate market. 1.3 billion people live in China, with approximately 300 million people unaccounted for. That means that China’s unaccounted for population is equal to the population of the United States (shocking).
My first stop was Beijing, the capital of China, a beautiful region full of amazing history and culture. Peking duck is delicious and I could eat it all day long, but I found most of the food mediocre at best. In fact, one night I visited the night market, and some food was being prepared which reminded me of a Hollywood horror film. The smell was so foul. I am still working on forgetting the smell.
The visit to Beijing was for an exhibition at the Luxury Property Showcase. We took a booth and our task to sell The Ritz-Carlton Residences at L.A. LIVE. We met several potential clients, as well as great contacts for future development. Additionally, we forged strategic partnerships for The Agency that will help us sell properties in China. We are quite excited to take international marketing to a personal level and to continue our international efforts and growth.
Culturally, it was amazing to watch how the communist government and the capitalistic business environment are colliding together in a country that is developing and has experienced double-digit economic growth. The Chinese are buying and investing in property in the United States for many reasons. First, the political risk in China is high, and people are scared that one day they will wake up and their money will be gone – the banks nationalized and bank accounts seized. Second, the devaluation of the American dollar and the strong Chinese currency makes US prices seem like a bargain. Combine this with the recession and 30% reductions in pricing, and you get the perfect storm. The Chinese are accustomed to and enjoy investing in Real Estate, something they have understood for many generations.
After a week in Beijing, I departed for Shanghai, one of the most incredible metropolises I have ever seen. The Huangpu River runs right through the middle of the city. The architecture is amazing; the skyscrapers are some of the newest and architecturally significant buildings in the world. Driving through the city, it seems as if it goes on forever. The energy is vibrant and strong.
One of the things that really stood out was the fact that I could not use my Twitter. Apparently, the Chinese government restricts the use of social media. As an American, we are so accustomed to freedom of speech that suddenly not having this freedom is acutely felt. Additionally, English is not widely spoken. You either need to have a translator with you, or make sure the people you are doing business with speak English. I recommend a translator; as we are the ones doing business abroad, the effort should be made to show respect for the Chinese culture.
After spending a few days in Shanghai I ended my trip in Hong Kong. Hong Kong is home to a much more Westernized society. Most people speak some English, and moving around and doing business in Hong Kong is far easier than in Mainland China. The challenges of doing business in Mainland China are more exciting and could possibly be far more rewarding. There is no question that Hong Kong is the gateway. It’s a beautiful city, a fun city, and the nightlife in Hong Kong is amazing. Lan Kwai Fong is an area where the people are out on the streets and the party is on, an international city with an international crowd.
Overall, my trip overseas was a huge success and my eyes were opened to an array of new possibilities. I feel culturally and intellectually energized, with a newfound vigor. Meeting such a variety of new prospects, and extending my network to encompass international contacts, I am confident that the future of the Agency is looking particularly bright. I was thoroughly impressed with the methods in which the Chinese operate, and am looking forward to more trips and growing The Agency’s business portfolio in China.
Read the article in Beverly Hills Lifestyle here [pages 96-97].
