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MARCH 2012 |www.opp.org.uk


The China Business Network


What does it do? - Facilitates investment and trade (inward and outward investment) - Destination management and organising inspection trips - Travel and tourism management: see www.Lvyou168.cn - Runs the Sino-overseas Education and Culture Exchange Foundation: see www.Liuxue168.cn - Facilitates meetings between state-owned enterprises and pri- vate investors, and between corpo- rate travel organisers and visitors - Designs, implements and runs Chinese-language websites on behalf of clients wanting an online presence in China - Maintains and optimises sites and pages for clients on the China Wide Web - Designs and produces all forms of marketing collateral in Chinese


to stay focused in a few markets worldwide,” he adds. It is better to think about the sort of opportunity being sought, rather than the geography he says. “Chinese buyers come here to the London Docklands, for instance, because they can buy into easy-to- manage, well-built, new, easy-to-rent- out apartments.” With offices in Beijing, Shanghai,


Guilin and London, CBN sees its role as guiding property investors through the process of getting into overseas property. “We will go to see the properties for people, we will organise travel packages so that the potential buyers can go and see the property in person, we educate investors online and offl ine in the various world markets, we get everything together … and we make meetings happen. We see ourselves very much as a partner in the buying process.” This is an essential, says Wu, as “the Chinese are very cautious. We do not buy things off-plan on a whim. We like to think carefully and only work with partners that we trust. In fact, this is one of the most important characteristics of the Chinese buyer market.” But, once persuaded that the fi gures


THE LAST WORD Developer profi le


stack up, that the property exists, that there is a suitably dynamic secondary market, and that the country in question has stable and well-established freehold property laws, Wu’s clients will spend … often on a big scale. Do your homework, give them the proper facts and fi gures that they like, and you will make money he says. “The overwhelming majority of


Chinese millionaires are into property as one of, if not their main, investment channel. Property is where they have often made most of their wealth. I know investors with at least 800 overseas properties in their portfolio. They will buy very early in the process and fl ip properties too. And the big ones all like the idea of multi-million dollar trophy properties in the main markets such as the U.K., Canada, the U.S.A. and Singapore.”


CBN has its own property portal too, called www.soufang168.com, which showcases properties anywhere in the world in the Chinese language. It looks good and is fully optimised for the China Wide Web. China is an exciting place to do


overseas property business too, he says. “Money moves fast in China. Sometimes it is like guerrilla warfare. Block us and we go elsewhere in a fl ash. When the government in China decided to stop nationals from building up big residential portfolios in China, they immediately looked abroad to fi nd better interest rates and bigger opportunities.”


“And this move into overseas property has opened the eyes of some very wealthy people in China. I am seeing more and more of them interested in the idea of emigrating later in life, to live abroad permanently.” Does this mean agencies in China trying to sell overseas properties should tap into lifestyle incentives and offer different add-ons to make the deal go through smoothly?


“Mmmmm, yes and no,” says Wu.


“If buying the property overseas can get the investor a permanent residency visa, then shout about it. But be careful about over-promoting things like the EB-5 visa in the U.S.A. The scheme is all about setting up a commercial enterprise and investing in a U.S. business, as well as a U.S. home. And businesses can fail and lose a lot of money.”


“There are entrepreneur visas and Trust | and reassurance are vital when the Chinese buy abroad says Adam Wu


investor visas and all sort of different rules and regulations. These sorts of things can be seen as a bonus, but not necessarily as a real driver of the deal.” “I think that you are, as an agent, likely to get more attention if you are offering things like the Malaysian second home visa or the Turks and Caicos Islands local residency visa alongside the property as a real added- value offering.”


“Chinese buyers really like the idea of buying in the Turks and Caicos Islands and, after fi ve years, becoming an overseas citizen of the U.K. They have the money, they are all just looking for somewhere sensible to park it.” So … offer somewhere that will


“Lots of Chinese buyers don’t realise they can borrow abroad, or use


ADAM WU | 65


the word, literally and metaphorically. The western developers are all in crisis and don’t have the money for things like a traditional road-show around a lot of big Chinese cities. They can’t afford to travel around a country the size of China. The logistics involved are very hard. And they often don’t speak the Chinese language either. We can use our network to get around these diffi culties.”


“Developers in China have a


different problem. They have money but the government is restricting their opportunities. They are being pushed out of China to fi nd schemes overseas. We have helped a number of them, especially in areas like the Caribbean.” What’s on Wu’s mind at present? The London Olympics he says, quick as a fl ash, and the boom in Chinese students at universities overseas.


savings as collateral”


make good money, as well as an escape route out of China.


Are there blockages? “It can be hard to borrow money overseas sometimes, if you are a Chinese investor,” says Wu. “Not that this is a problem if you work with us. Many overseas banks fi nd it hard to assess the creditworthiness of a Chinese buyer, and lots of buyers in China don’t even realise that they can borrow abroad, or use their savings as collateral to buy more.”


“But, we have good links with


organisations like The Bank of China, or The China Industry and Commerce Bank, and can help. We will act as intermediaries and get fi nance in place.” “CBN will also help developers fi nd agents and buyers. I can help spread


“I have helped a lot of Chinese parents fi nd student homes for their children overseas in the past few years,” he says. “I advise them to get a two-bedroom apartment, put their child in one room and get rent out of the other room – enough rent to pay for the running costs of the apartment. Pick the right city, like London, and then sell it on after 5 or 10 years and make a good piece of capital growth.”


Any regrets? “I should have bought some apartments of my own in the UK city of Leeds,” he says. “Leeds has two big universities and this summer it will be the training base for the Chinese Olympic team. I could have got in there at the right time and made a good return. But I didn’t.”


There will be more opportunities to come though, he adds, smiling. “I’m sure of it.”


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