“Wary of Future, Professionals Leave China in Record Numbers” read the Oct. 31 headline in The New York Times. In opting to emigrate, Chinese professionals are seeking greater freedoms — of expression, of religion — and a more secure, stable future, which they feel is uncertain in their homeland.
The article went on to say that “Chinese immigrants are driving real estate booms in places as varied as Midtown Manhattan, where some enterprising agents are learning Mandarin, to the Mediterranean island of Cyprus, which offers a route to a European Union passport.” Concurrently, the number of millionaires in China stands at 1.4 million, according to a June estimate by the Boston Consulting Group.
Does this mean anything for the South Fork’s real estate industry? Maybe. But it’s wise to act now to position for the potential influx, said Judi Desiderio, chief executive officer of Town and Country Real Estate, based in East Hampton.
James Gao, a Town and Country agent and a native of China, recently returned from Luxury Properties Showcase, a three-day trade show held earlier this month at Beijing’s Legendale Hotel that brought real estate agents and developers from multiple countries together with potential buyers.
For affluent Chinese, buying and owning a house makes sense, said Mr. Gao. “Some friends in China have 10 or 20 different apartments, but the government limits their numbers,” he said. “And they don’t own it, they lease it from the government. Their kids won’t be able to own it. Buying and owning makes a lot more sense. Also, the U.S is safe and secure.” Mr. Gao cited the metropolitan area’s three international airports and the already sizable Chinese community in New York City as factors that should attract affluent Chinese to the South Fork.
China would be the newest, though hardly the first, foreign country to which Town and Country is reaching out, said Ms. Desiderio. The addition of China, she said, only underscores the Hamptons’ global recognition and appeal, reflected in its stable of agents from Holland, Italy, Portugal, France, and Germany, as well as liaisons to prospective buyers in Russia and England.
“We realized that we have quite a melting pot here at Town and Country,” she said. “James was the first to say he wanted to go to this real estate forum. People from all over the world were there. We see an opportunity there for him and for Town and Country.
“If somebody’s coming from Germany, Japan, or China, they have to have someone on board that can speak the language,” she added. “Without an interpreter, that barrier can stop someone from moving forward.”
Tania Valverde, an agent with Prudential Douglas Elliman in East Hampton, agreed. “Real estate and finances are very different in other countries,” Ms. Valverde, who speaks five languages (though not Mandarin or Cantonese), said. “We almost have to hold their hands or ‘baby sit’ much more than with American buyers.”
While some of Manhattan’s highest-end real estate has been bought up by foreigners, particularly from countries, such as Russia, where vast fortunes have recently been accumulated, it does not necessarily follow that the market here is next in line. So far, Ms. Desiderio said, Town and Country officials are excited only by the potential Chinese immigrants may offer. “If there is going to be an international explosion in the Hamptons, I think it will happen after Manhattan realizes a big boom,” she said. “If that happens, once they become entrenched in Manhattan, they’ll discover what the Hamptons has to offer.”
Raymond Smith, branch manager of Prudential Douglas Elliman’s East Hampton and Southampton offices, agreed that foreigners who buy luxury real estate in Manhattan will find their way east. “Nobody comes from Hong Kong to Southampton. They come to Manhattan first,” he said. “When they buy a multimillion-dollar apartment in Manhattan, people will tell them, ‘You’ve got to come out here.’ ”
“We’re beginning to see that,” said Debra Reece, manager of the Bridgehampton branch of Sotheby’s International Realty. “Certainly, what we’ve seen in Manhattan is keen interest. That is now beginning to flow through to the Hamptons.” The real estate brokerage’s affiliation with Sotheby’s auction house, Ms. Reece said, provides a strong presence in, and allows outreach to, Hong Kong and other parts of China. Real estate agents attend Sotheby’s auction events, she explained, and meet prospective clients at private parties and other events as well.
Prudential Douglas Elliman’s sizable presence in New York City, as well as Westchester County and Long Island, means a steady flow of international customers, Mr. Smith said. On its Web site, prospective buyers can search for agents by language spoken. A query on the site returned 39 Mandarin-speaking agents in and around the city.
Sotheby’s real estate Web site, said Ms. Reece, functions in 16 languages and updates global currency exchange rates every three hours. “We reach out to people in their own language,” she said.
In the Hamptons, Mr. Smith said, one of his agents is presently working with an Asian buyer, and a number of others have sold to Russian buyers. It makes sense, he said, that affluent Chinese would look to emigrate. “It’s a very oppressive regime,” he observed.
Forbes magazine’s list of the world’s billionaires, Mr. Smith said, contains a large number of Asians. “They’re always going to want to invest in the U.S. — it’s always the safest place on earth. That’s why we’re selling penthouse apartments in Manhattan for $45, $50 million.”
The conditions are ripe for a Chinese-fueled real estate boom on a local level. At the Luxury Properties Showcase, said Mr. Gao, many attendees inquired about the U.S. Citizenship and Immigration Services’ Immigrant Investor Program. The program, known as EB-5, was created by Congress in 1990 to stimulate the U.S. economy through job creation and capital investment.
Foreign buyers, of course, would need a visa to immigrate to the U.S. “I’m just promoting the real estate,” Mr. Gao said. “Maybe for the next trip, I’ll hire a lawyer to go with me.”
“It’s just a matter of time,” Ms. Reece predicted. “We anticipate we’re going to see more and more interest from the Chinese market in the Hamptons, just as we have seen in Manhattan.”