THE ASIAN INVESTOR’S THIRST FOR FINE WINE China’s growing wealthy class has acquired tastes in high-end wine that the nation’s wealthiest investors are willing to supply
SPRING2014
MY NY LUXURY TRANSACTION // ASIAN INVESTING TRENDS WITH SOTHEBY’S // ANGIE LEE’S UPPER WEST SIDE and MORE...
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2014 AREAA Global & Luxury Summit Setting the New Standard of Excellence
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SPRING 2014 Vo l u m e 6 , I s s u e 1 ON THE COVER: Chateau and vineyard in Bordeaux, France. ©Javarman / Veer
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F E AT U R E S 16
My New York Luxury Transaction Hear from one of AREAA’s premiere luxury agents Katie Kao as she recounts her experience showing an ultra-wealthy Chinese buyer some of the most exclusive properties New York City has to offer. By Katie Kao
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The Asian Investor’s Thirst for Fine Wine With an emergence of the middle and upper class in countries such as China, Taiwan, and Hong Kong, we detail how East Asian investors are using their increased wealth to purchase wineries and vineyards in increasing numbers.
30
By Michael Kelly
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Focus on Sotheby’s and Asian Investing Trends Sotheby’s Chief Executive Officer explains how the company has successfully identified the purchasing habits of wealthy Asian buyers and why it is important to do so in today’s real estate market. By Philip White 38
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SPRING 2014
T I ME TO CO N DUCT
SOM E E L EC T R ICI T Y.
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Š 2014 General Motors. All rights reserved. CadillacŽ ELR.
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CONTENTS 22
Cadillac’s Enduring and Evolving Luxury Icon
40
How the iconic automobile company’s image as a luxury car brand came about and how this icon is maintained in the everchanging landscape of high-end vehicles. By Donny Nordlicht
26
Pushing the Edge in Luxury: Why NYC is Still on Top
42
Despite directly competing with other bustling mega-cities, New York City’s designers continually redefine the luxury lifestyle to ensure that it will remain the most desired city for the world’s wealthiest.
10 Questions with AREAA’s Vicky Silvano We sat down with AREAA’s newest Chapter Development Chair and found out her greatest fear, her favorite rock band, and her experiences as a college athlete.
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SPRING 2014
Why Commercial Matters in 2014 Although traditionally thought of as a market for wealthy Caucasian males, commercial real estate is witnessing an influx of successful AAPI and women agents and brokers and is primed to make some serious noise in the real estate business.
By Jessica Bernstein-Wax
By Jacki Ueng
10 Questions in Luxury and International Real Estate
Foreign Lending: Learning the Ropes HSBC’s Jeff Needham and Citi’s Heather Battaglia explain the often times confusing details of working with foreign buyers and how to overcome any unforeseen difficulties that may arise in the process. By Michael Kelly
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Pacific Union’s history may date back to its 1975 founding, but the esteemed San Francisco Bay Area luxury real estate firm is leading the real estate market in forging business partnerships with Asian clients in a number of unprecedented ways.
Considering getting into luxury or international real estate? Hear from AREAA’s most successful agents as they answer some often asked questions posed by those interested in breaking into these markets.
By GieFaan Kim
28
Pacific Union and the Asian Homebuyer
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Manage Your International Profile With Proxio Learn how Proxio (formerly AREAA Net) connects you to a worldwide network of over 600,000 real estate professionals so you can build your global brand and reach international buyers. By John Peretz
ADVERTISERS
52
D E PA RT M E N T S 11
12
A Message from Chair Choi
mmauricio@areaa.org
page 33
AREAA Korea Trade Mission
CharlieSuhRealtor@Gmail.com
page 49
AREAA National Convention
www.areaa.org/convention
page 51
AREAA New York East
areaaNYeast@gmail.com
page 53
Bahia Principe Residences & Golf
www.bahiaprinciperivieramayagolf.com
page 34
Bank of America
www.bankofamerica.com/webinars
page 14
C&M Communiqué
www.cmcommunique.com
page 41
Cadillac
www.cadillac.com/ELR
page 5
Nabil Captan, Credit Scoring Expert
www.nabilcaptan.com
page 2
DFW iRealty
www.dfwirealty.com
page 15
Gina Duncan, Maui Real Estate Advisors, LLC
www.FineIslandProperties.com
page 34
Go Global Realty
www.GRELV.com
page 27
Juwai.com
www.Juwai.com
page 33
Gary Kawano, Citi
GaryKawano@citi.com
page 49
Meiling Kravarik, Nextage M3 Realty
www.NextageM3Realty.com
page 49 page 49
Linda Lee, Keller Williams Realty
Linda@buy858.com
Lone Oak Fund
www.LoneOakFund.com
Letter from the Editor
National Association of REALTORS® Global
www.realtor.org/earncips
Clara Paik, New Star Realty of Boston
www.ClaraPaik.com
page 43
Peter Park, Prime Properties
www.peterparkre.com
page 43
The Residences at W New York Downtown
www.wnyresidences.com
page 13
Michael Ring, Go Global Realty
mhring@grelv.com
page 49
The Serhant Team
www.nestseekers.com
page 35
Shawn Elliott Luxury Homes & Estates
www.ShawnElliott.com
Sotheby’s International Realty
www.sir.com
Charlie Suh, RE/MAX Tri-City Realty
CharlieSuhRealtor@Gmail.com
page 43
Billee Spodek, Coldwell Banker Residential Brokerage
Billee.Spodek@cbmoves.com
page 49
Sybarite Investments
www.sybariteinv.com
page 25
Kathy Tsao, Douglas Elliman Real Estate
ktsao@elliman.com
page 10
United Escrow Co.
(213) 386-1830
page 43
U.S. Trust
www.ustrust.com
Wells Fargo Home Mortgage
www.wellsfargo.com/mortgage/ privatemortgagebanking
Bernice Wong, Bay Area Elite Homes
www.BayAreaEliteHomes.com
Betty Sun Wong, Pacific Union
BettySunWong@Gmail.com
page 10
Cindy Wu, Keller Williams Luxury Homes International
www.CindyEstates.com
page 49
In My Neighborhood with Angie Lee Longtime resident Angie Lee shows off the best restaurants, parks, and other attractions that make New York’s exclusive Upper West Side one of the best neighborhoods in Manhattan.
52
AREAA Directory
Ivan Choi tells us what has AREAA members so excited and why he shares their enthusiasm.
Global transactions are the new local transactions. The world’s wealthiest continue to look for a place to call home and this issue equips you with the knowledge needed to get involved in these lucrative deals.
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CONTACT PRAVEEN SHARMA to find out about ADVERTISING OPPORTUNITIES: psharma@areaa.org | 951-514-1053
Around the Association The holiday season was a very exciting time for the organization including installation events s of AREAA’s Aloha, Dallas Fort Worth, and Chicago chapters as well as Lunar New Year celebrations organized by AREAA’s Las Vegas and Seattle chapters.
pages 20-21 page 1
Inside Back Cover page 3
Inside Front Cover page 9 Back Cover
SPRING 2014
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SPRING 2014 Vo l u m e 6 , I s s u e 1
EDITOR-IN-CHIEF Caroline Gim EDITOR Michael Kelly C R E AT I V E D I R E C TO R Praveen Sharma EDITORIAL TA S K F O R C E David Tran Long Doan Sharon Marsh-Wyly Trang Dang-Le
is a publication of the Asian Real Estate Association of America (AREAA), a national nonprofit trade organization dedicated to increasing sustainable homeownership in the Asian American community. For more information visit: http://areaa.org. Š2014 by the Asian Real Estate Association of America. Reproduction in whole or part without permission is prohibited. Opinions expressed by individual authors are not necessarily the opinions held by AREAA. Interested in advertising or contributing? Contact us: Praveen Sharma ADVERTISING | psharma@areaa.org Michael Kelly EDITORIAL | mkelly@areaa.org Office: Asian Real Estate Association of America 5963 La Place Court, Suite 314 Carlsbad, California 92008 760-918-9162 Phone 760-585-1397 Fax Previous issues available online at: http://areaa.org/a-r-e
For additional web-based content, please make sure to download the application.
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SPRING 2014
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1. Wealth Management provides financial products and services through various banks and brokerage affiliates of Wells Fargo & Company (Members NYSE/SIPC). This information is for real estate, builder, legal, and finaicial plannign professionals only and is not intended for distribution to consumers or other third parties. Credit is subject to approval. Some restrictions apply Consult a home mortgage consultant for details. Information is accurate as of date of printing and is subject to change without notice. Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. © 2011 Wells Fargo Bank, N.A. All rights reserved. NMSLR ID 399801. AS1018782 Expires 05/2014
BETTY SUN
WONG CIPS, CRS, PMN, CDPE
LUXURY PROPERTY SPECIALIST
BettySunWong@Gmail.com 415.298.7373 Betty Sun Wong is one of the Top Producing Realtors across the nation. Fluent in Mandarin, Cantonese, Toisan, and English, she has 20+ years of industry experience and specializes in working with Buyers and Sellers all across the Bay Area and overseas.
BRE# 00932814
From New York to the World
For Expertise in the New York Metropolitan Area
With over 17 years of experience, working with buyers and sellers from around the world, Kathy Tsao has specialized in the sales, marketing, and property management services of luxury condos, single and multiple family homes. From advising developers and investors, to individual buyers, she has the managerial and leadership experience to deliver. 曹凱西專精紐約大都會地區的房地產，從對開發商和投資者提供諮詢，到對個人購房 者提供豪華公寓，單/多戶住宅的購買，銷售，和物業管理，有超過17年專業經驗， 服務來自世界各地的買家和賣家。
Kathy Tsao 曹凱西
575 Madison Avenue, New York, NY 10022
2012 AREAA National Chairwoman ktsao@elliman.com 212.891.7788
MESSAGE FROM THE CHAIR
W
ith the first few months of being AREAA’s 2014 National Chair under my belt, I have found that there is an overwhelming sentiment throughout our organ ization: excitement. As I have visited many of our 32 chapters across the United States and Canada, I see an energy amongst our members that seems contagious. It feels as if the organi zation never lost any fervor that coalesced with AREAA’s 10 Year anniversary celebration this past fall.
As demonstrated by the overwhelming success of trips such as our Japan Trade Mission late last year, our members clearly understand that making those business ties around the world sits high on their priorities.
With the direction that the organization is headed, it is no surprise where this source of enthusiasm comes from. AREAA has seen its chapters grow while its members are continu ing to make strides in strengthening connec tions within the organization while greatly expanding their personal businesses. In my conversations with many of our members, a small number of topics are frequent among those discussed. The first of such topics is the importance of doing business overseas. As demonstrated by the overwhelming success of trips such as our Japan Trade Mission late last year, our members clearly understand that mak ing those business ties around the world sits high on their priorities. They know that they can gain an enormous amount of opportunity as long as they are willing to step outside of their normal business scope, but embrace this task with vigor that you do not see with the common real estate professional. Another subject that raises the excitement levels of AREAA members is the opportunities associated with doing business with clients representing the highest echelon of net-worth. The prospect of making that multi-million dollar deal is something that resonates with a large group of our members. Like international real estate, these members realize that they can stand to gain valuable leads by finding the means to break into a luxury market tradition ally defined in terms of its difficulty to break in to.
steps to take. This is where AREAA’s incredi ble support system comes into play. AREAA’s leadership realizes that entering and thriving in these markets can look like a daunting task. That is why we continue to provide our mem bers with the guidance and tools they need to expand their reach. With events like the Global and Luxury Summit, attendees can hear from leading experts on these subjects get proper insight on the directions they need to take in establishing connections in these fields. This will also lead to valuable connections that will span your career in real estate. It is crucial to understand that AREAA can only provide a unified voice for the Asian American real estate professional when our members have established themselves in every corner of the real estate industry. When members are connected within the organization and their respective areas of business, they will have the strength necessary to fight on behalf of AAPI homeownership around the country. That is why a commitment to our members to provide a way to accomplish this.
IVAN CHOI 2014 AREAA NATIONAL CHAIR
I have also noticed that with this excitement also comes some apprehension. Some members realize the enormous opportunities as well as the personal experience they stand to gain with such ventures, but are unsure of the next
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LETTER FROM THE EDITOR In this issue of a|r|e magazine, we explore the global market, luxury brands, and the wide spectrum of opportunities for real estate professionals in international and luxury transactions. The world’s affluent hold one-fifth of their wealth in real estate assets. High net worth individuals buy luxury homes around the world for personal use and enjoyment. These buyers are interested in more than four walls and piece of land; they are seeking out an experience, a lifestyle. Cities like New York, Las Vegas, Bev erly Hills, and San Francisco offer something unique and draw affluent buyers willing pay a premium to live in an exclusive community or high-rise building with amenities that exceed all expectations. Consider the business potential in helping an international buyer purchase a residence or vacation home catering to a specific lifestyle in your market (like Katie Kao’s New York luxury transaction), or facilitating the purchase of a vacation home abroad for a U.S.-based client. Between a CIPS designation, Proxio (see John Peretz’s article in this issue for more informa tion on this worldwide network), AREAA trade missions, and international networking oppor tunities you have plenty of tools in your arsenal to set up a niche for international transactions. Aside from personal residences, the ultrawealthy further diversify their portfolios with real estate investments in areas where they have trusted advisors to manage their properties. By incorporating clear investment underwriting and property management in your business model, you have the potential to repre sent foreign buyers who will purchase multiple properties and hand these properties back to you for rent collection and management.
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SPRING 2014
Additionally, Jacki Ueng writes in this issue about the rise of Asian American brokers in the commercial market, and AREAA Commer cial’s vision to provide members with educa tional, business development, and networking opportunities. Ambitious, newer agents looking to seize commercial opportunities will have a network of trusted mentors to turn to with questions and to get advice on unfamiliar chal lenges they may face. It is easy to see that there is a lot of capital flowing east, west, north, and south in search of a good home (pun intended). There is no reason not to get involved. If you have not already heard, global is the new local. Tech nology allows you to communicate with your clients like never before. AREAA provides tools, training, and networking opportunities to help you to succeed. What are you waiting for? Let’s go out and make some money.
Sincerely,
CAROLINE GIM EDITOR-IN-CHIEF
ART MEETS COMMERCE
THE RESIDENCES AT W NEW YORK— DOWNTOWN STUDIO, 1 & 2 BEDROOMS AVAILABLE FOR OWNERSHIP 123 WASHINGTON ST, NYC 212.385.1100 INFO@123WASHINGTONST.COM WNYRESIDENCES.COM
AMPLIFY THE EVERYDAY
The design concepts for the furnished residences at The Residences at W New York—Downtown including all loose furnishings and certain fixtures and finishes, were entirely conceived by the participating designers. Starwood Hotels & Resorts Worldwide, Inc., W Hotels and their affiliates were not involved in developing the design concepts or selecting such furnishings, fixtures and finishes for the residence and make no representations that they are consistent with the image, quality, design standards and expectations of the W Brand. A Moinian Group project. The Residences at W New York—Downtown are not owned, developed or sold by Starwood Hotels & Resorts Worldwide, Inc. or its affiliates. Moinian Group uses the W trademarks and trade names under a license from Starwood Hotels & Resorts Worldwide, Inc. This is not an offer to sell or solicitation of offers to buy, nor is any offer or solicitation made where prohibited by law. The statements set forth herein are summary in nature and should not be relied upon. A prospective purchaser should refer to the entire set of documents provided by Moinian Group and should seek competent legal advice in connection therewith. Equal Housing Opportunity. Sponsor: 123 Washington LLC, 530 5th Avenue, Suite 1800 New York, NY 10036. The complete offering terms are in an Offering Plan available from the Sponsor. File No. CD06-0687. If this license is terminated or expires without renewal, the residential project will no longer be associated with or have any right to use, the W brand trade names or trademarks.
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Amanda Chin Realtor® 469.226.5460 AmandaChin07@gmail.com
MY NEW YORK LUXURY TRANSACTION BY KATIE KAO
PHOTOS COURTESY OF BACCARAT RESIDENCES
I
nternational buyers are choosing New York City and its surround ing areas for many reasons. New York is not only one of the largest cities in the world, but it is also a city filled with allure. Some of these attractions include the New York Stock Exchange, the Finan cial District, the Statue of Liberty, Rockefeller Center, Central Park, the Museum of Modern Art, and some of the nation’s best wineries and beach es. Additionally, financial well-being and a high quality of life make the area highly sought after by foreign investors. In addition to the rich culture and diversity, one major factor in the decision making process for foreign buyers is the area’s excellent school systems. Most of these immigrants locate themselves in this area to provide their children with an ex ceptional educational environment which affords them more opportu nities than they would otherwise receive. Recent data shows that at least 80% of immigrants choose New York for its excellent education sys tems and convenient metro transit systems. Fifth Avenue luxury shopping is another reason that New York is becoming increasingly attractive to wealthy foreigners. While they are enjoying the quality of life here, they are also looking for investments to balance financial risks to avoid uncertainties due to policy changes in their local governments.
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SPRING 2014
According to NAR, for the 12 month period ending March 2013, total sales volume made by interna tional clients is estimated at $68.2 billion, making up approximately 6.3 percent of the total U.S. Existing Home Sales (EHS) market of $1.08 trillion. Out of this $68.2 billion, 51% of these sales are from foreign investors buying up large amounts of properties such as commercial build ings and high rises. The remain ing 49% comes from immigrants looking to permanently reside in the country. This figure is down from $82.5 billion a year ago due to fewer transactions and lower prices caused by economic conditions impacting international sales. As a result, this uncertainty both locally and aboard in addition to exceptionally tight mortgage credit standards are prompting some foreign buyers to temporarily hold off. This trend should be somewhat eased due to favorable market con ditions. We are seeing this upward trend in New York City and Long Island where some of the prices have already risen by 30% as compared to a year ago. It is predicted that the number of Chinese buyers and immigrants coming to the U.S. will be tripled in the next few years and the purchasing power for AAPI buyers as a whole could rise above $1 trillion. The foreign purchasers that I have frequently worked with are from Hong Kong, Taiwan, and
Baccarat Residences Enclosed Kitchen
mainland China. Because of local government policies, most of these countries engage in policies that stymie prospects of domestic in vestment. For example, According to the Heritage Foundation’s 2013 Country Economic Freedom Index, China ranks 136 out of 177 countries listed. The factors that contribute to China’s rank include an economic freedom score of only 51.9, a 20% score for property rights, an invest ment freedom score of only 25%, and a freedom of corruption score of 36%. China’s rule of law, residential and commercial property rights, and intellectual property rights do not enjoy the same degree of protection as other countries. For this reason, we are seeing more wealthy Chinese buyers in the United States purchas ing luxury residential properties, “A” rated commercial office buildings,
2013 AVG PRICE PER SQFT in NEW YORK CITY
$1130 Source: Trulia
Baccarat Residences 18th Floor Duplex with Terrace
and hotel chains under individual names, corporate names, LLC, and estate accounts. These buyers believe that U.S. real estate remains a secure, desirable, and profitable way to invest their capital. These foreign buyers almost always fall into 2 distinct categories. The first of such categories is invest ment buyers. These are the buyers that are looking to buy up properties such as commercial buildings, strip malls, and hotels in order to expand upon their personal or corporate portfolios. The second category is made up of first time home buyers. This group has been a recipient of conditional green cards through pro grams such as the EB-5 visa program. Most of these prospective Chinese buyers prefer newly constructed residential properties to old houses and will make a number of conces
sions to ensure that can secure this type of home. If they purchase an old home, they will generally do a tear down over spending money for new construction. Due to differences in both business culture and languages, a more concentrated effort is required when dealing with foreign buyers as opposed to local buyers. Personally, I take great care in meeting with these types of buyers, taking detailed notes on what they want and explaining the particular situation to ensure their understanding and agreement with my recommendations. At the same time, I determine whether the purchaser is really interested in buy ing or if they are just testing out the market before getting serious about the process. When meeting with foreign buyers, the importance of certain
factors is augmented. It is important to determine the type of property the buyer is interested in, the financial condition of the purchaser, the loca tion he/she is looking for, how much they can afford to spend, whether or not it will be a cash transaction, and if they are interested in any particu lar school districts. I will hold their hand and walk them through every step of the buying process. One of the most recent interna tional buyers I assisted was in the U.S. for about 10 days to purchase investment residential properties as well as luxury property for his own use. He first went to California and purchased about 200 single-family homes. He then came to New York looking for luxury residential prop erty for himself and his family. Like a growing number of buyers from China, his assistant informed me that
money was of no concern. Because I was told this, I made limousine arrangements for the duration of his stay in the city. Even with this reassurance, it is always a good practice to speak directly with the buyer. I interviewed him as I normal ly do with all my other buyers. We met for about 20 minutes and spoke about the terms and conditions of the transaction to determine how I would best represent his interests. We also talked about the practices of a real estate transaction in his home country among other things. I informed him of the differences in real estate practices between the United States and China and the ad ditional documents that are needed here in this country. For instance, as part of the evaluation process I informed him that he needed to fulfill certain requirements such as
SPRING 2014
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having 1) a 3 month bank statement under purchaser’s name to provide proof of sufficient funds associated with purchase and closing costs; 2) the appropriate funds transferred into a U.S. account for down payment immediately with the remaining funds wired into that account prior to closing; 3) an accountant prepare financials in English and notarized by proper authorities 4) a Sources of Income Statement from an employer, investment fund provider, etc,; 5) two years’ worth of tax returns from
notarized; 8) a Corporate Business License and lastly 9) reference let ters from friends or trade associates. I then advised the buyer that he will need an attorney representing him in the process for protection from legal issues that may arise, such as negotiating the terms, fees paid, etc. I also outlined my responsibil ities as his agent. I indicated that I would help him find the right property, an appraiser and other nec essary matters during the process. He told his assistant to prepare all
Source: Trulia
his home country for himself and his business, which would also needed to be translated and notarized; 6) a copy of a valid passport; 7) a family registration booklet translated and
of the required documents. Based on this criterion, he explained the type of property he was interested in, and I provided him with pictures and layouts of 4 separate properties.
Baccarat Residences Pool
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Since time was limited, we agreed to see each property that after noon. After I made ar rangements, I notified his assistant of the showing times for the 4 properties. The first appointment was scheduled for 4:30pm to see The Baccarat Residence and Hotel at 53rd Street and 5th Avenue. Unfortunately, the first appointment had to be cancelled because we could not locate the buyer. We discovered that he went on a helicopter ride to see Manhattan from the sky and neglected to inform his assistant and myself. We resched uled the appointment for the following day and this time he was late due to the fact that he decided to go shopping on 5th Avenue. Once reunited, I stressed to the buyer that business practice in the US dictates that it is imperative that we arrive on time for our appointments with cooper ative brokers so as not to jeopardize the relationship between buyer and seller. The property we were to tour, The Baccarat Residence, is a 50 story building located directly across the
street from the Mu seum of Modern Art. With the world’s most iconic fashion destina tions nearby, including Tiffany & Co., Cartier, Louis Vuitton, and Barney’s New York, the Baccarat is an elegant crystalline box housing the brand’s “distinct art of gracious living” concept. The Baccarat Residence is a private enclave in the heart of the city, dedicated to an unrivaled level of service and luxury. Res idents have complete access to the amenities of the Baccarat Hotel, including a five-star restaurant, chic bars, spa, fitness and an aqua center. A 24-hour con cierge also anticipates residents’ needs down to the last detail. After touring the property, the buyer was impressed with the quality of the interior design and the Baccarat crystalline masterpieces. The next property on our agenda was 432 Park Avenue, an 84-story tower, between 56th & 57th Streets, which will be the tallest and most expensive residential building in the Western Hemisphere upon comple tion. The cheapest apartment in the building, a 351 square foot studio,
Like a growing number of buyers from China, his assistant informed me that money was of no concern.
Baccarat Residences Lobby
Unfortunately, the first appointment had to be cancelled because we discovered that the buyer went on a helicopter ride to see Manhattan from the sky and neglected to inform his assistant and myself. costs $1.59 million with other studios going for as much as $3.9 million. Two bedroom & 2 bath apartments (1,789 square feet) are listed for about $9.7 million. Additionally, three bedroom & 4 ½ bathrooms (4,019 square feet) are selling for
Baccarat Cristal Bar
$31.8 million and full-floor pent houses (8,255 square feet) have a $95 million listing price. “About half the buyers are foreign born”, stated Harry Macklowe, the property’s developer, “As with many of these buildings, only about a quarter of
the units will be occupied at any one time. The building offers residents an indoor-outdoor event space for 350 of their closest friends”. We were shown the 3 bedroom and full-floor models. After completing the tour, the buyer admitted he liked the full floor space with a panoramic view of the New York City skyline. Whether he was tired from all of the excitement of shopping or he found what he wanted, he decided at this point that he did not want to see anymore properties. He signed a contract for 432 Park Avenue after we negotiated the purchase price. The building is scheduled to be completed by the end of 2014 and purchasers may complete the pro cess and move in by early 2015. My experience with this interna tional buyer has brought to light a number of important considerations that real estate agents must keep in mind while doing business with this type of clientele. While working with a foreign purchaser, it is best to request that they execute a power of attorney once they arrive and execute the purchase contact prior to them returning abroad. In many
instances they may not be here for the closing. I informed my buyer that under the U.S. Foreign Investment in Real Property Tax Act, there is a 10% withholding on the total consider ation and there is also a New York State non-resident withholding in the amount of 8.82%. The only ex ception is if the purchaser buying the real estate intends to use it as his or her primary residence. If that is the case, the consideration is less than $300,000. In managing international trans actions, agents need to get proof of liquid assets and get those assets into the U.S. In some cases, agents need to verify buyer’s marital status to avoid any problems later on. It is also imperative to get documents translated correctly with proper signatures from authorized officials. Agents must know when and which document needs original signatures. Once these things are accounted for, professionalism and knowledge of the buyer/seller and the broker will guide the direction of the deal.
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CADILLAC: AN ENDURING and EVOLVING LUXURY ICON
BY DONNY NORDLICHT
There are certain things that make you stop, turn, and look back over your shoulder. A car, a house, a handbag, a suit –the items themselves can be aspirational, and they instill passion. There is a draw about these goods. As a real estate agent and a member of AREAA, you are acutely aware that the moment of igniting a client’s right brain can make a sale. A house is more than its location, square feet, and number of bedrooms, just as a car is more than metal, leather, and wood – it is passion, emotion, and feel. That passion for more than the sum of parts has kept Cadillac in the global consciousness through out history, leading the brand to be a leader in both iconic design and innovative technology. In the past decade, Cadillac has taken the steps need ed to develop its brand as a luxury icon through art and science design philosophy, furthering its leadership in both design and technology.
CURB APPEAL For consumers, design is a top consideration when purchasing a luxury vehicle. (Not unlike how curb appeal plays heavily into home buying decisions) Cadillac has long had a history of trim ming its cabins in the highest quality of materials, styling interior environments to delight the senses, and equipping vehicles with the most up-to-date technology, it often takes the view from curbside to get people in the door. At Cadillac, our designers have worked tire lessly to create a coherent aesthetic that shows familial relation, but still has distinct personality from vehicle to vehicle. For example, all Cadillacs have signature LED “light blade” running lights, and vertically oriented LED taillights that recall the tailfins and vertical lighting elements from the brand’s heritage. However, each model has its own character and interpretation of these elements: the technical and jewel-like execution of the
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ABOVE: The 2014 Cadillac ELR, winner of a prestigious EyesOn Design Award BELOW: The new longer, lower and leaner Cadillac Crest, redesigned for 2014, featuring a classic grid layout and the removal of the traditional wreath that previously appeared as a second piece surrounding the Crest
headlights of the 2014 CTS sedan, the full-height and precisely detailed taillights of the 2015 Escalade. Cadillac designers have realized that forging a luxury automobile brand is about more than just the car, it is about an emotional connection. Any luxury good must have an ephemeral connection to the buyer, one that makes a statement that the buyer aligns with the brand. Cadillac works to have a distinct personality in the marketplace – an automo tive embodiment of an eye for style and design, an appreciation of the finer things, and the desire to break from the status quo without making sacrifice. Our designers are luxury consumers themselves, and look not to cars for their inspiration, but at the products they buy. This is a shift away from the technical aspect of creating a car – instead, the Cadillac team looks to the skyscrapers of Manhattan, the fine stitching of an Italian leather handbag, and to the precision of a Swiss wristwatch. (Or, more recently, a Detroit-made Shi
nola watch!). Creating a car becomes less about the vehicle, but about what it connotes in a larger sense. This is a more holistic approach to design: it is not so much about the car, but about the feeling of a greater sense of ownership in a brand. This shift away from “just making cars” and growing, shaping, and crafting an overarching brand is a sentiment that has resonated with luxury customers. Cadillac was the fastest growing full-line luxury auto maker in 2013, with sales up 22 per cent in the U.S., the brand’s largest expansion since 1976. Cadillac has also been bringing new customers to the brand with its unique blend of luxury, design, and technology – 72 percent of buyers of the award-win ning ATS sedan were new to Cadil lac, and one in five Cadillac buyers in 2013 were under 35. However, it has not been without bumps along the way. As Melody Lee, Cadillac’s Director of Brand and Reputation Strategy explains, “His torically, we’ve been very focused on our products, for good reason. We talk about our cars individually, and sometimes we talk about our cars as a lineup. What we have often not been so good at, particularly at Cadillac, with a luxury consumer, is to discuss the brand itself. That is important because we are making the best products we have made in our history, but we suffer from a brand perception issue, and a brand relevancy issue. No matter how
good our products are, there are still people who say ‘Cadillac is not a brand for me.’ We are working hard as a luxury automaker to make sure that when people are making plans to shop, Cadillac is on that list.” The attention to detail in the development of our vehicle is core to how Cadillac has evolved as a luxury brand. The distinct style of the cars is a physical embodiment of the Cadillac mystique. It was not always this way – Cadillac has had a long history as a premiere luxury brand, but not always resonating with progressive and forward-look ing luxury customers. As a passion brand, this is key, no matter what the products are. Cadillac is working to change its perception. We have established new relationships with brands and experiences rarely mentioned in the same breath as Cadillac – includ ing Saks Fifth Avenue, Who What Wear, and W Magazine – to regain relevance and put our cars back on shoppers’ lists. Cadillac, however, never completely disappeared from the landscape.
AN EVOLVING ICON Another key to developing a lux ury brand is inserting your company as an icon in popular culture. The Cadillac brand has long stood as an iconic pillar of luxury in the public consciousness; loved by movie stars, and celebrated in popular music. Cadillac continues to be part of the cultural zeitgeist, being mentioned as an aspirational goal in music tracks such as Lorde’s “Royals” and Mackle more & Ryan Lewis’ “White Walls,” and as a mark of accomplishment in “Two Black Cadillacs” by Carrie Underwood. The three artists all fo cus on a diverse set of vehicles from
Cadillac’s history – Lorde speaks generally about “driving Cadillacs in our dreams,” Macklemore raps about his 2008 DTS sedan, and Underwood showcases two black 1964 de Villes. There is no better example of the brand’s consistent evolution throughout its 112-year history than the Cadillac Crest. The Cadillac Crest has evolved and been revised many times throughout history. Each time Cadillac has updated the Crest, it represented the brand’s evolution in design, which in turn is a reflec tion of that era in society. For 2014, Cadillac again evolved the Crest, utilizing textured layers and making it more technical. While it is now a single piece (versus the previous two-piece wreath and crest), the outer pockets are a modern interpretation symbolic of a wreath. The Crest still maintains a frame, even with the traditional wreath being gone. There is now a focus on the core of the Cadillac Crest – similar to the engineering and design focus on the core of the brand with new lower, longer, leaner vehicles – allowing the classic grid layout and four colors (gold, blue, black, and red) to feature more prominently. What sets Cadillac aside from many other luxury automakers is that none of this is new – Cadillac’s name and vehicles have been contin ually been centerpieces of popular culture for decades, and the Crest almost continually undergoes evo lution in lock-step with the brand’s products. The brand continues to look forward into the future with this holistic approach to brand evolution. The 2014 ELR is a great example of Cadillac’s the brand’s history and future into one stunning coupe.
ABOVE: The 2014 Cadillac ATS compact luxury sport sedan BELOW: The Elmiraj concept, which made its global debut at a private event during the exclusive Pebble Beach Concours d’Elegance
Despite evolution over time, it is an EyesOn Design Award-winning design with provocative style. This particular model embodies the fact that Cadillac always has been and continues to be a design leader and a brand for the style-savvy. However, to stay current, the ELR is technologi cally advanced and has innovative features such as electric powertrain and entertainment systems. A similar embodiment of what Cadillac stands for is the Elmiraj concept. It is a grand coupe expressing the pure enjoyment of driving and exploring new dimensions for the brand’s ongoing expansion. Focusing in on the experiential side of the brand, the Elmiraj did not make its global de but at an auto show, but at a private event during the exclusive Pebble Beach Concours d’Elegance. While it is a stunning vehicle, this particular event is evidence of how our brand uses intangi bles to underscore the fact that this is no longer your father or grandfather’s Cadillac. The brand understood then the importance of what luxury consumers valued, just as today Cadillac under stands that an experience is just as valuable as the product itself.
AMERICAN LUXURY As other brands connote old-world luxury from Europe, or highly technical luxury of Asia, Cadil lac has taken considerable effort in constructing an image that is resolutely American. The brand has instilled a passion behind the vehicles that stems from the inherent entrepreneurship built into American culture. Cadillac’s design is provoc ative, interior materials are honest of their origins, and use of technology is progressive. Despite being 112 years old, Cadillac demonstrates a brand that is constantly looking ahead and evolving with the time, similarly, the American dream is to strive for better. Cadillac has worked hard to ensure its custom ers that this passion has been behind every past, present, and future vehicle adorned by the Cadil lac Crest. It has led to cultural icons with striking designs, luxurious interiors, and up-to-the-min ute technology. Like many other luxury goods, Cadillacs are cars that are more than just modes of transportation, but passionate extensions of their owners.
SPRING 2014
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PUSHING THE EDGE IN LUXURY: WHY NYC IS STILL ON TOP
BY GIEFAAN KIM Year after year, the race for luxury continues and New York City continually pushes to compete amongst the world’s most innovative cities. With impressive towers rising around the world in places like Dubai, Macau, Abu Dhabi, Singapore, and London, the question on everyone’s mind is “What’s next for luxury and will New York City remain a contender?” The luxury residential market is often the strength of the city’s real estate market and 2013 has shown it to be true once again. According to The Real Deal’s 2014 data calculations, the average luxury sales price increased 14.8% from Q3 to Q4 and the average sales price in this niche exceeds $6,200,000. Even with these figures, what defines luxury will usually vary depending on who is asked. To some, lifestyle is the key element to luxury while price range or location is stressed more by others. Additionally, technology is a rising star in many new properties. It is common to see iPhone docks and smart home technologies integrated into homes and offices. Oreste Drapaca, a New York City-based architect who specializes in town homes, states “technology is always a desired element and people allocate substantial funds for it. To be able to control lights or monitor security remotely from across the globe is certainly a luxury. However, these amenities are expensive elements that can be added to any home. Luxury
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does not simply end with a property having the most up to date technologies.” In addition to a property having all of the latest gadgets, space is also a big consideration in the luxury real estate market. Jeffrey Lam, who is the President and CEO of Lam Generation that devel ops hotels and residential projects all over New York City, concludes that the demand for larger units is growing because of the baby boomers. “Land is expensive,” says Lam, “but developers will keep building because this large group of buy ers has accumulated the wealth needed to keep paying the price.”
the property’s cut curb allows a resident to drive directly into a private garage elevator which then rises directly into residence itself. Features such as complete privacy, cutting-edge technology, magnificent views, and large spaces have attracted some of the biggest celebrities to buy in the building. As demonstrated, it is clear luxury is perceived differently to each person. However, no matter who you ask, there is the common agreement that we all know so well: location. The key to New York City’s predominance in luxury real estate lies in expansion of up-and-coming neighborhoods.
The key to New York City’s predominance in luxury real estate lies in expansion of up-and-coming neighborhoods. While builders and designers will try to wow the audience with privacy and space, which are considered rarities in high-density cities such as New York City, traditional amenities are certainly not being forgotten by a large number of pro spective buyers. Full service buildings stocked with these comforts will always remain in high demand. Even though spas, gyms, and designer lounges are natural to consumers these days, there are emerging concepts that are pushing the envelope in terms of innovation and design. iYoungWoo and Associates is one of the more innovative development teams in the area and have finished with an exciting complex on Eleventh Avenue, the Sky Garage. Representing the first of its kind,
Due to the fact that they represent rising neigh borhoods, areas like Harlem and boroughs like Brooklyn have seen incredible growth in pricing. The more prime the location, the higher the ap peal for luxury buyers. Internationally, New York City ranks among the top 10 most desirable cities in the world to buy real estate for the simple reason of location. Amongst other reasons for its attraction, it is ultimately location that is the steady variable that keeps foreign investors constantly preoccupied with the city. “New York City and its immedi ate neighbors will always be inseparable from luxury real estate, concludes Lam, “especially international customers from the China and Asia markets.”
QUESTIONS w / AREAA’S
ues Ken Jacq
10
Y K C I V SILVANO
1
4
What book (other than the Bible) impacted you most? Think and Grow Rich by Napoleon Hill. The lessons this book has taught me are still very much applicable in today’s high tech world!
Tell us something that no one would ever guess about you.
2
Where would you go on your ultimate vacation?
5
I played basketball in Varsity College.
I would go on worldwide cruise with my family.
What or who is the greatest love in your life? My husband, who is the greatest support of my life.
3 6 9
7 8 10 What famoouyosu person d ire? most adm
ld have to That wou . y Clinton be Hillar art, has a She is sm nd is aracter, a strong ch om! a great m
rite o v a f o w t r u What are yo ies of all time? mov avorite My two f re The movies a Music Sound of James and any vies. Bond mo
Give us three visions of the future of real estate ten years down the road.
Who's your favorite rock band? The Beatles - if they are still considered a rock band these days.
What’s your
greatest fear? My greatest fear has to be the fear of failure. That’s where I get my motivation and drive to succeed.
est What’s the bbiugsginess you’ve lesson int was never learned tha taught? nd
t asset a r greates u o y is n re lots of utatio . There a ld Your rep e h p n u e ays b this lesso should alw s in business and own nts in the ups and d rvice clie e s o t w o eh taught m ible way. s s o best p
1. Super Tech highway will be the name of the game in gadgets, transactions, and
more international deals will happen due to easy flow of money and communications.
2. Bitcoin will happen -- again, this will impact the global exchange of monies and deal making.
3. New construction homes will have less square footage but with high tech gadgets that will affect values; Return to Urban/city living and this
reverse movement from suburbs to city will create high prices and demand. Real estate pricing will go back to normal cycle of price increases/adjustments. SPRING 2014
29
Asian The
Investor’s
Thirst for Fine Wine By Michael Kelly
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SPRING 2014
T
he world’s wine producing regions are beginning to get a growing amount of interest from abroad through an emerging group of ultra-wealthy buyers. These foreign investors are not coming from traditional areas such as Europe, the United States, or Canada, but are making a large number of winery transactions from countries in Eastern Asia, most notably from countries such as mainland China, Hong Kong, and Taiwan. This peak in interest in both domestic and foreign wineries is a testament to the growing purchasing power of China’s population as a whole. In the last decade and a half, China’s middle class has grown to a staggering 300 million people, which accounts for 25% of the Chinese population and matches the population of the United States almost entirely. Addition ally, China has seen astonishing amounts of ultra-wealthy busi nessman arrive on to the scene. According to a 2013 report of worldwide wealth accumula tion, China accounts for 6% of the world’s population of people whose fortunes exceed $50 million, which is second only to the United States. This figure is reflected in the fact that the number of China’s billionaires has increased from two to 64 from 20052010. Similarly, the number of millionaires in Hong Kong has climbed to over 100,000, which represents a significant increase in the years since the global fi
nancial crisis of 2008. When all of these factors are considered, it is not a surprise that the Pacific Rim is slated to surpass North America as the wealthiest region on the planet by 2017. For a large part of this newly formed class of wealthy businessmen, success came through investment in real estate. In recent years, some of the most successful Chinese investors have been in volved in the sales of high-rise apartment complex es as well as large commercial real estate projects. As many of these entrepreneurs became wealthier, they began to look toward high-end products and luxury property. Soon after, prospective buyers began looking toward the most prolific wine-pro ducing regions in the world such as California’s Napa Valley and France’s Bordeaux region to buy up vineyards and wineries in impressive numbers. To account for this rising demand, many real estate firms have created specialized entities devot ed to the sale of wineries and vineyards. One such company that is making these changes is Christie’s International Real Estate. One of the firm’s newest additions, Vineyards by Christie’s, is an advisory service specifically serving international clientele interested in the investment opportunities wineries and vineyards bring. This program offers prospec tive buyers the chance to talk to experts in the field of luxury wine related property and features a port folio of properties from regions such as Bordeaux, Napa Valley, Oregon’s Willamette Valley, and New Zealand’s Marlborough region.
Photo: Chateau and vineyard in Bordeaux, France. ©Javarman/Veer
the Pacific Rim is slated to surpass North America as the wealthiest region on the planet. …it is not a surprise that by 2017
SPRING 2014
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$760 $280 1980
$316 1990
2000
2010
Source: China Market Research Group
When asked about the importance of the program, Clayton Andrews, who is Christie’s Senior Vice President, remarked, “This program was specifically conceived to meet demand from high-net-worth individuals, clients from Christie’s wine specialists and, specifically, our Hong Kong wine auction attendees requesting expert advice in purchasing overseas vineyard properties. This service is designed to simplify the acquisition of a foreign vineyard estate by offering specialized guidance to prospective buyers through every step of the process.” This emergence of specialty services such as Vineyards by Christie’s International Real Estate is closely tied to a similar arrival of wealthy Asian buyers to luxury markets around the world. By 2012, there were 40 recorded winery transactions made by Asian investors. In 2013, this number steadily increased by 20 sales in the Bordeaux re gion alone. Firms such as Maxwell-Storrie-Baynes, which is an affiliate of Christie’s International, continue to see considerable interest from Asian investors. Consequently, many expect that 2014 will bring a continuation of such trends. According to experts, the majority of these buyers come from mainland China. These Chinese investors represent close to 90% of these trans actions made by Asian buyers. For this group of wealthy businessmen and businesswomen, areas
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Chinese investors are beginning to come to the realization that they possess a strategic advantage in owning these types of wineries due to the fact that they have distribution access into one of the largest consumer markets in the world
Middle Class Consumer Spending in the Asia Pacific Region (In Trillions of Dollars)
$32.9
$4.9 2009
2030 projected
Source: Quartz (http://qz.com/43411/the-worlds-middle-class-will-number-5-billion-by-2030/)
$3000
Nailia Schwarz/Veer
China’s Annual Expendable Income Per Capita
rich in vineyards are appealing for many reasons. Michael Baynes, who is a partner for Maxwell-Stor rie-Baynes, explains that a large num ber of China’s wealthy are developing quite a taste for fine wine. He states, “Bordeaux Wines are becoming quite a luxury item for affluent Chinese consumers. These customers look to these areas for wine because of strong AOC systems and regulatory oversight to ensure that these wines are authen tic.” He continues, “History and pres tige underwrite the interest in places such as Bordeaux and in this regard the Asian investors are no different from many other countries that have fallen in love with Bordeaux over the centuries like the United States, the United Kingdom, and Germany.” Baynes adds, “Chinese investors are beginning to come to the realization that they possess a strategic advan tage in owning these types of wineries due to the fact that they have distri bution access into one of the largest consumer markets in the world. It is simply a sensible business strategy to purchase a vineyard, which is com parable in price to an apartment in Beijing, and then sell wine as a luxury product to the emerging middle class in their country.” An additional reason for increased activity is due to favorable timing. Baynes explains, “We really began to see increased in activity from Chinese
China Fact Sheet Population:
1,349,585,838*
Median Age:
36.3
Population Growth Rate:
.46%*
Total Number of Middle Class Population:
300 Million
*July 2013 est. Source: US Central Intelligence Agency
buyers in Bordeaux vineyards in early 2010 after the release of the 2009 vintage. After that release, interest really began to spark.” Around this time, vineyard prices in the regions were at historical lows and remained that way for years. These buyers were able to take advantage of abundant supply and low prices and purchase numerous chateaus in the region. The developing preoccupation with luxury items such as sprawling vineyards and fine wines by the east ern Asian countries, most prominent ly China, has several implications for the direction that the real estate industry will take in the coming years. For the first time this century, we are witnessing a significant segment of the world population making signif icant gains in personal wealth and transitioning to the middle class. With this development, a whole new set of opportunities will become available to real estate practitioners who are willing to take their business over seas. This new group of consumers will continue to develop their tastes in luxury properties and successful real estate agents and brokers will be there to meet this demand. That is why real estate in fertile European regions such as Bordeaux as well as established wine-producing locales in the United States will become ex citing areas in real estate activity for years to come.
GO TO AREAA.ORG AND UPDATE YOUR PROFILE TODAY Get qualified for the 2014-2015 luxury, international, and commercial directory For more information, contact Michelle Mauricio at mmauricio@areaa.org
Hawaii Real Estate Clients? Gina Duncan is “Your Guide to Hawaii Real Estate”
Gina Duncan, Realtor (Broker)
ABR, AHWD, e-Pro, GRI, SFR Co-Founder & VP of the AREAA Aloha Chapter Maui Real Estate Advisors LLC www.FineIslandProperties.com 808-250-9858 FineIslandProperties@Gmail.com
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IN MY NEIGHBORHOOD with
ANGIE LEE New York City’s
UPPER WEST SIDE
T
he Upper West Side is a neighborhood in Manhattan which lies between Central Park and the Hudson River. Unlike the East Side, it is primarily a residential area, predominately occupied by young professionals with families.
What attracted you to this part of town? I am a product of a Jesuit education at Fordham University in the Upper West Side. That’s when I began to find this neighborhood charming. My husband and I currently live approximately 30 yards away from Central Park and we are also walking distance to the Lincoln Center. That was the deal maker for me! All jokes aside, I like the people and the family culture in this neighborhood. My neighbors are young families, devoted community members, and aging citizens. There are many varieties of businesses in the neighborhood, which makes it so convenient for us to NEVER leave this part of town. My husband and I are members of Redeemer Presbyterian Church on 83rd St. and Trader Joe’s just happens to be on 72nd Street. Other than traveling to/from work or social engagements, it is tough to get me out of the 20 block radius of our home.
DATE NIGHT Jean Georges
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SPRING 2014
PLACE TO HAVE A BEER/ COCKTAIL I like to grab drinks at a wine bar called Dakota on Columbus Ave. For a fun setting, try the Stone Rose Lounge near the Columbus Circle.
What’s the number one selling point that residents and new buyers rave about? Because it is mostly residential, the neighborhood is quiet at night, even on weekends. There are bars and restaurants that stay open late but I think people are just more responsible around here – that’s what attracted me to this part of town. Some people have described UWS as a suburb of New York City because of this. Another major factor is that the West Side of Manhattan doesn’t have to bare the subway construction noise in the Upper East Side. I see people from that neighborhood making their way here.
What is a common misconception about your neighborhood that you’d like to clear up? A common misconception is that the UWS has no good restaurants – which is completely false! From Isabella’s on 77th & Columbus Ave, Dovetail on 77th & Columbus Ave, Telepan on 69th & Columbus Ave, to Jean Georges on 61st & Central Park West, we can certainly compete with the downtown eating joints. My only wish is that there will be a Korean restaurant nearby one day.
Can you share one of the neighborhood’s best-kept secrets? There is a neat outdoor restaurant along the Hudson River, behind the Trump Towers on West End Ave. When the weather is nice outside, I like to invite friends there to grab dinner and watch the sunset together. The Hudson River view overlooking New Jersey is absolutely stunning. If you are in the mood for something sweet, check out Levain Bakery. They are best known for freshly baked chocolate chip cookies that are the size of your face! The waiting line goes out the door around the block sometimes – it is that good!
Photos by
CHRIS NICODEMO
VIEW MORE OF CHRIS NICODEMO’S PHOTOGRAPHY: www.flickr.com/photos/nycniko
SHOPPING
On Columbus Avenue from the 60’s to 90’s – there are many boutique clothing stores. Also, the TimeWarner Center at the Columbus Circle has several great shops.
What types of outdoor activities does What is your favorite way to spend an afternoon with family or friends here? your neighborhood offer? Central Park offers everything from bicycles, park amenities, jogging, an amusement park (designed for the little ones), the Central Park animal zoo, rowboats, soccer fields, basketball courts, baseball fields and kid’s playgrounds. Just up a few blocks on Central Park West, the Natural American Museum is also a good place to spend the day with family, or if you are just visiting the town.
I have to say that my favorite way to spend time with loved ones is to hang out in Central Park. It sounds a little creepy but I like to people watch. My friends and I like to sit at the park to catch up on life then pass silly comments on weird people wearing tight work-out clothes – the ones who are just pretending to be working out, ha. I have seen people who come out all dressed up (and dolled up) just to grab other peoples’ attention. It is too funny not to laugh at.
What is your favorite restaurant in the neighborhood? Tell us about it.
Do you volunteer with any local organizations or causes?
Oh man. This is a tough question. It is tough because I really enjoy eating (thanks to my “foodie” girlfriends) even though I can’t seem to eat more than most people. Let’s just say that I do not have a favorite restaurant on any list. I have a list of over 200 restaurants bookmarked in my yelp account that I still need to try (and to write reviews for.) Most people don’t know how serious I am when it comes to food but if I was given an opportunity, becoming a head chef at an American (New) cuisine restaurant is something I would seriously consider. My favorite cuisine types are American (New and Traditional) and Mediterranean.
I am private about my life so most people do not know that I am a lifelong volunteer for various Christian churches. Most recently, I provided assistance in putting together a summer camp for over 1,000 young adults, aged 13-18, at the Brooklyn Tabernacle Church. I am also a longtime supporter of The World Vision organization which helps unprivileged children with access to clean water and basic living necessities throughout the world. I have participated in volunteer projects for various organizations such as the Habitat for Humanity and the Susan G. Komen for the Cure in the past. I am also a current member of the James Beard Foundation, Asia Society, and Carnegie Hall Friend Organization.
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FOCUS ON SOTHEBY’S AND ASIAN INVESTING TRENDS
BY PHILIP WHITE
W
hen considering the practices of a success ful real estate agent or firm, one of the most important is learning the buying habits and pref erences of differing consumer groups. Observing such patterns allows for seamless adaptation in collective or individual business models that can produces targeted campaigns that can be applied across the spectrum of consumer groups. For almost four decades, the Sotheby’s Interna tional Realty® network has connected the finest in dependent real estate companies to a wide variety of prestigious clientele groups around the world, providing a powerful marketing and referral program for luxury listings. It has found success in these endeavors due to the fact that they have properly identified the purchasing habits of the most important players in global business trans actions. Within the past decades, it has become very clear that countries in the East have emerged as such players. With billions of dollars to place in the country, Sotheby’s has made the realization that pegging down both the habits and preferences of this group of buyers is a key to thriving in the current real estate market.
FOCUS ON ASIA AND ASIAN AND ASIAN-AMERICAN BUYERS
Asian investors who buy in America and the Asian-American market represent significant growth opportunities for the entire real estate industry. For that reason, Sotheby’s recently estab lished representation in Hong Kong and strength ened their presence in Japan through the addition of offices in the metropolitan areas of Tokyo and Yokohama – their largest growth so far in the Asia Pacific region. By doing this, representatives of the company have come to the conclusion that a number of these
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buyers tend to fall in the higher echelons of income. The price of homes sold to these international buy ers averaged $354,000 during the April 2013-March 2013 period compared with $228,000 for domestic buyers, according to the NAR report. Most Asian buyers are from China, representing 12 percent of all international sales; India, 5 percent; and Korea, 2 percent. The median price of homes purchased by Chinese buyers was $425,000, by far the highest of any country. Indian buyers paid a median price of $300,000, the second-highest of any country. The majority of all international buyers – 63 percent – conduct these transactions in cash.
ENVIRONMENT, EDUCATION, CULTURE AND LUXURY LISTINGS ATTRACT ASIAN BUYERS
The Pacific Northwest traditionally has been an attractive destination for Asian buyers due to its proximity, pristine environment and sought-after schools and universities. But Asian interest in the region’s real estate has grown exponentially in re cent years, particularly as Chinese buyers seek to diversify their investments and fulfill aspirations to own property outside their own country. Realizing that real estate costs in the Seat tle area are viewed as a bargain compared with Vancouver to the north and San Francisco to the south, Realogics Sotheby’s International Realty established an Asia Desk with Mandarin-speaking brokers and a specialty website focused on the unique needs of Chinese buyers. In the words of Dean Jones, Realogics Sotheby’s International Re alty President and Chief Executive Officer, “When it comes to Chinese buyers, the real estate axiom is ‘location, education, environment’.” Price isn’t always the issue. According to the Journal article, Chinese money is flowing to areas with high concentrations of Chinese immigrants
including San Francisco, Los Angeles and New York. To capitalize on this phenomenon, Sotheby’s Internation al Realty Inc. brokers on the East Side of Manhattan have immersed themselves in the Asian culture, rec ognizing that they must understand and appreciate a distinct Asian world view on real estate.
CHINESE BUYERS MOTIVATED BY PROPERTY PROTECTIONS, LUXURY LISTINGS AND WEALTH
Nikki Field, who is a Senior Global Real Estate Advisor and Asso ciate Broker at the firm, explains that working with Asians requires “vast new skill sets” because their cultural, social and business protocols are profoundly different in style than typical domestic buyers. Their focus on harmony, balance and order is fundamental to their lifestyle choices, she said. During the last five years, Field and her team have studied Mandarin, attended business culture classes and participated in numerous Chinese business organizations, all in an effort to better understand Asian customers. Field has observed that investors from mainland China are motivated by the fact that real estate purchases in the United States are safeguarded by well-defined property rights, low interest rates and high-quality properties for sale. Her foreign sales have grown from 23 percent of overall revenue in 2008 to 68 percent in 2013. Another motivating factor is the increasing wealth of many Asians. The Wealth-X and USB Billionaire Census reports that Asia is growing billionaires and total wealth faster than any other region in the world. The billionaire population in Asia rose by 18, or 3.7 percent, and the region’s total wealth increased 13 percent last year, according to the survey, predicting that the “ultra wealth tier” in Asia will catch up with North America within the next five years. While New York, Los Angeles, Philadelphia, Detroit and Houston are by far the top cities for Chinese investors, more buyers – notably from China’s rising middle class – are targeting
Detroit, Honolulu, Chicago, Charlotte, and Austin, where real estate costs are lower, according to The Wall Street Journal. Even Florida, traditionally favored by South American inves tors, is attracting Chinese buyers who discovered the state as tourists.
ASIAN-AMERICAN MARKET REPRESENTS GROWTH OPPORTUNITY
While overseas Asians represent an important and growing market, the U.S. real estate industry would be wise to give equal attention to a related population right in its own backyard: Asian-Americans, who represent a significant growth opportu nity for our industry. According to the Asian Real Estate Associ ation of America, the Asian-American market is growing faster than any other multicultural group in the United States. The Asian-American consumer base is growing, affluent, technologically savvy and has increasing buying power – $718 billion, which is expected to reach $1 trillion in just five years. Moreover, Asian-Americans are the most prolific spenders in the nation, according to a Nielsen survey released late last year and reported in the Los Angeles Times. Asian-American house holds, on average, have incomes of $100,000 or more – earning more than general U.S. households – and spent 19 percent more than overall households in 2012. The survey determined that Asian-Americans are the fast est-growing cultural segment in the nation, with a population of nearly 19 million that is expanding beyond the traditional population centers of the West Coast and New York. Nearly all states experienced 33 percent or greater growth in their Asian-American population, according to the Los Angeles Times article. It’s fair to say that Realtors who are not already focused on this group will miss one of the great real estate opportunities in our recent history.
Philip White is a conference planning co-chair for the Asian Real Estate Association of America’s 2014 Global and Luxury Summit.
OPPOSITE PAGE: The Studio House, by master architect Tom Kundig, in Seattle. ABOVE: The Lakehaven Estate in Seattle, which has the largest dock and boathouse on Lake Washington. LEFT: A 5,654 square foot home surrounded by 4,300 square feet of R. David Adams designed gardens and water features in Kirkland, Washington.
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PACIFIC UNION AND THE ASIAN HOMEBUYER BY JESSICA BERNSTEIN-WAX
C
alifornia, and particularly the Bay Area, has become an extremely attractive real estate market for Chinese buyers looking for invest ment opportunities, second homes, or resi dences that let their children attend the region’s highly ranked schools. Despite this fact, many local real estate firms have not yet fig ured out how to address this growing demand in their neighborhoods. These companies have not yet integrated their businesses models to account for differenc es in languages, time zones, and business culture. However, there are a handful of firms that are taking this opportunity in stride and adapting their
Pacific Union CEO Mark McLaughlin stands at the Mutianyu Great Wall outside of Beijing with real estate professionals Steven Mavromihalis and Jenn Davis and Senior Brand Marketing Director Jessica Frushtick.
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operations to meet this demand effectively. Of these busi nesses, Pacific Union has pursued this specialized market quite vigorously in the past few years. Pacific Union, a staple of the San Francisco area real estate market, currently operates 24 offices in nine coun ties in the San Francisco area. Pacific Union represents one of the fastest-growing brokerages in Northern Cali fornia and indeed across the United States. This year, the San Francisco Business Times identified the company as the third-largest residential brokerage in the Bay Area. Additionally, Inc. Magazine included it in the prestigious Inc. 5000 list of the highest-growth companies in the country. CEO Mark McLaughlin is quick to note that directly engaging this clientele, not simply relying on tools and technology, remains critical to supporting Pacific Union’s robust growth in the San Francisco area. “Our business model in particular thrives on trusted relationships, knowledge, advice, and recommendations,” McLaughlin says. “We choose to make investments in technology and solutions that support these linchpins to our success and enable our real estate professionals to offer their service to these Chinese clients.”
CHINESE INTEREST IN BAY AREA REAL ESTATE Recent Chinese interest in this area is a product of a number of factors related to the real estate crisis that arose from sub-prime mortgage transactions. During this crisis, Chinese homebuyers increasingly looked to the U.S. for real estate deals. That interest has continued to grow, thanks in part to comparatively lower taxes and costs per square foot in the U.S. After years of increased activity, Chinese buyers trail only Canadians as the most frequent foreign inves tors in U.S. residential real estate, with most purchasing homes in Cal ifornia, according to a 2013 National Association of Realtors report. The median price of those homes came in at $425,000. In recent years, Pa cific Union has seen Chinese interest in Bay Area properties swell among investors and families seeking second homes or residences for their children. The ease with which travelers can fly back and forth to mainland China and other Asian destinations
OPPOSITE: Pacific Union CEO Mark McLaughlin receives the 2013 RISMedia Real Estate Leadership Award. Image courtesy of RISMedia
HOW IS PACIFIC UNION GROWING? PACIFIC UNION’S CHINA CONCIERGE PROGRAM Offers clients in mainland China a single point of contact for services (real estate market analysis; identification of available estates) that help them buy investment properties in Northern California and parts of Nevada. TECHNOLOGICAL INNOVATION Pacific Union’s new digital listing presentation tool lets real estate professionals give their clients a comparative market analysis with three different presentation options: a proprietary and fully interactive iPad app, a secure website, or a highquality printed presentation.
has made Northern California a particularly convenient location for Chinese homebuyers. In addition, the area boasts excellent schools, world-class shopping and dining, a staggering array of cultural and art offerings, and well-established Chinese com munities. These buyers tend to seek out condominiums, newly finished homes, and properties near transportation and strong schools.
BUSINESS PRINCIPLES AND GROWTH After years of doing business in the region, Pacific Union serves as a model for real estate firms looking to tap into the wealthy Chinese clientele network. The company’s business principles of network expansion and technological innova tion have uniquely positioned it to push the boundaries of the industry, foster new ideas, and continuously meet and exceed client expectations. It is these principles that are sought after by Chinese investors as well as Asian buyers from places such as Singapore, India, and Hong Kong. With this business model, Pacific Union fosters an atmosphere of mutual respect that en courages employees to come up with new ways to serve clients. “Pacific Union has enjoyed consistent accelerated growth in the San Francisco Bay Area because we embrace innovation that increases buyer choice and satisfaction,” McLaughlin concludes. “We have come a long way and we plan to stay at the forefront of real estate in the Bay Area for years to come.”
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PACIFIC UNION’S CEO MARK McLAUGHLIN CEO Mark McLaughlin has a long history as a highly respected leader at the intersection of real estate and technology. In November 2013, real estate information leader RISMedia recognized McLaughlin presented him with its prestigious 2013 Real Estate Leadership Award.
CORPORATE
30101 Town Center Dr. Suite 104 Laguna Niguel, CA 92677 949.363.7974
10
in
QUESTIONS
When you think of the word ‘luxury’, what brand comes to mind and why? “Paris, London, Rome, Beverly Hills, NY, Hong Kong those are the cit ies that are luxury cities and in terms of brands Rolls Royce, Chanel, Cartier, Hermes, Louis Vuitton are the first to come to mind.”
- CHRISTOPHE CHOO
Christophe Choo
Tim Hur
SPRING 2014
REAL ESTATE
If you want to impress a What is the worst high-end client, where thing you can do when would you take them? dealing with high-end “Because I am located buyers? in Beverly Hills, I have several places that I am able to take clients. For the older clients I would go to the Montage or the Bel-Air Hotel for cocktails. For dinner I would take them to Spagos. For shopping I would take them to Rodeo Drive, which is 2 blocks from my office.”
“Not listening to or paying attention to what their needs and desires are, always anticipate what they would like and always give them options and suggestions”
- CHRISTOPHE CHOO
What types of properties do you see being increasingly bought up by high net-worth clients?
If there’s one piece of advice you could give someone that is trying to break into this market, what is it?
“Properties being bought up by high net-worth clients are ones that are in good locations…it’s all about location, location, location!”
“Live and be in the environment where rich people are, as rich people want to do busi ness with people that are like them. Know the luxury world inside out!”
- JOYCE ESSEX
- JOYCE ESSEX
How often do you meet In what area of the your foreign clients face world do you see the to face? most activity coming “My clients usually from in global real come down at least estate? once a quarter if we have something pend ing, or every six months at the least if there isn’t anything pending. When I travel inter nationally, I also try to meet with them when I’m there as well. Most of the time, my clients usually come for the closing as well.”
- TIM HUR 42
& INTERNATIONAL
“We really have all kinds in Canada. There is no doubt that a lot of the Asians come to Vancouver due to the mild climate. This group includes Chinese, Filipino, Viet namese, etc.”
- TINA MAK
Joyce Essex
Jessica Ye
- CHRISTOPHE CHOO
What is the most difficult part of doing business with inter national clients? “The most difficult part is to make sure that they would only be working with you exclusively and would not be calling all the brokers around town.”
- JESSICA YE
How do you deal with the time difference when communicating with your client? “It is important to be flexible and be conscious of the time, so you don’t acciden tally call them at an inconvenient moment. This can be somewhat challenging depending on the time zone differ ences.”
- HEATHER BATTAGLIA
If there’s one piece of advice you could give someone that is trying to break into this market, what is it? “Lead with service and sharing - your know ledge of how US mar kets operate is just as valuable as the property you are selling.”
- BILL ENDSLEY
The Certified Expert
in Los Angeles, Beverly Hills, California
PETER PARK CCIM, CPM PRESIDENT / BROKER PRIME PROPERTIES AREAA NATIONAL BOARD MEMBER AREAA GREATER LOS ANGELES PAST PRESIDENT Office: 323.933.0330 x201 | Cell: 323.810.1565 | BRE #01177044
www.peterparkre.com | peter@peterparkre.com Luxury Homes & Commercial R.E.
FLUENT IN ENGLISH, SPANISH AND KOREAN
FOREIGN LENDING: LEARNING THE ROPES BY MICHAEL KELLY
A
fter observing real estate figures over the past few years, it is clear that domestic real estate purchases by foreign investors account for a significant amount of real estate transactions in the United States. Accord ing to a study done by the National Association of Realtors (NAR), these type of real estate purchases accounted for $66.4 billion in 2011, $82.5 billion in 2012, and $68.2 billion in 2013. As these figures suggest, these types of buyers will continue to be a stable source of real estate purchases in the United States for some time. Wealthy investors from places such as China, Taiwan, Japan, and Hong Kong will continually look to United States for surefire opportunities to invest in residential and commercial properties. The country’s universities will also continue to attract affluent buyers looking to purchase homes for their children while attending college. As a result, property in the United States will consis tently be viewed in a favorable light by overseas buyers and investors. Although this niche group provides real estate professionals in the U.S. with a great opportunity to increase their business, this group presents cer tain challenges that are distinct from those faced
Billions of Dollars Sales of U.S. Residential Property to International Buyers
by agents dealing exclusively with U.S. citizens. Unlike domestic purchases, transactions of this nature are accompanied by additional paperwork, fees, and waiting times. Because of this addition al layer of procedures as well as differences in business culture, many of these prospective buyers find this process cumbersome and perplexing. As a real estate agent, guiding clients through this seemingly arduous process appears challenging. However, it is in the best interest of real estate practitioners to become acquainted with the complex details of the process of foreign buyers purchasing property here in the United States. Having an agent well versed in the intricacies of lending to foreign investors will allow for an expe dited home buying process free from unnecessary delays and dead ends. This will lead to a relatively smooth deal that will expand upon your personal business portfolio and increase the likelihood doing business with your international clients well into the future. Even though the home buying process for foreign buyers has its own distinct set of rules, it is important to note that the core principles of the home buying procedure remain unchanged. “What a lot of real estate professionals don’t real
2011 $66.4
2012 $82.5
2013 $68.2
Source: National Association of REALTORS®
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In my opinion, the most important thing to keep in mind with these types of deals is setting clear expectations.
things such as employment and assets. For Needham, another key difference lies in determining credit. He adds, “Because a number of coun tries do not have credit scores similar to FICO, it takes additional effort to determine an accurate assessment of a client’s credit history.” Another key is clearing up misconceptions that a potential buyer may have in regard to lending. Heather Battaglia, who is Citi’s Vice President of Diverse Markets, explained, “Some foreign buyers may not understand U.S. lending requirements and therefore may become frustrated with the various financial verifications and paper work involved.” Needham also adds, “Because these buyers and investors come to the U.S. with little or no knowledge of our lending practices, misinformation is bound to cause confusion. In my experience, foreign buyers are most confused about the amount of credit that can be extend
CANADA CHINA MEXICO
1. 2. 3. 4. 5.
INDIA
Because loans such as a 30-year mortgage are new to a large number of these buyers, it is the job of the agent to familiarize the buyer with U.S. lending culture.
Top Countries of Origin for International Clients
UNITED KINGDOM
ize is that dealing with these foreign investors is not all too different than working with U.S. citizens” remarked Jeff Needham, who is a Retail Bank ing and Wealth Management Senior Vice President at HSBC Bank, “It is the same process with only a few key differences.” Needham goes on to state that the differences lie in the process of verification. Additional effort must be devoted to verifying
23% 12% 8% 5% 5% Source: National Association of REALTORS®
ed to them. I have had buyers in the past indicate that they came to the buying process believing that only a miniscule amount of credit could be offered. In places such as China and Hong Kong, the majority of the real estate purchase is done in cash. Loans account for a very small por tion of the purchase. Because loans such as a 30-year mortgage are new to a large number of these buyers, it is the job of the agent to familiarize the buyer with U.S. lending culture.” Even if real estate professionals provide their clients with all of the relevant information about a particu lar real estate, unavoidable problems can still arise. One such complication
that practitioners may face is trying to navigate language barriers. With any trans-national business trans action, there will almost always be some sort of difficulty in communi cation where agents run the risk of not effectively engaging the client. “One of the most common ways for these types of deals to go wrong is not being able to get on the same page due to not understanding each other’s language, Needham admit ted, “This is why HSBC has hired staff that is proficient in languages such as Mandarin and Cantonese.” Another issue often overlooked is the difference in time. Battaglia explains, “Obtaining clarification by
phone may take several days when time zones and working hours are different. Alleviating this issue may require communicating outside of normal business hours.” Successful communication between an agent and their interna tional client, in addition to over coming language barriers, is found when expectations are effectively recognized and managed. When asked about this, both Needham and Battaglia stressed the importance of this. Needham answered, “In my opinion, the most important thing to keep in mind with these types of deals is setting clear expectations. As you already know, mortgage lending in the United States is a defined process where lending practices are standardized so that every detail is accounted for. However, a lot of these buyers and investors come from places where this type of process is less defined. This means that it is up to the agent or broker, working with lending firms such as HSBC, to present clear guidelines. This means that reasonable expecta tions need to be arranged.” Battaglia also added, “Setting proper expecta tions, explaining requirements and going the extra mile to alleviate any potential hurdles will go a long way with the client.” A key aspect of the lending process that needs to be addressed is the time frame. For a process such as this, a reasonable time frame to give to a prospective buyer would be about 40-60 days. It is important to note that this figure will vary across the country from high paced markets such as California’s Silicon Valley to more rigid markets like Manhattan. However, once barriers in business culture are broken down, additional paperwork and other stipulations are addressed, and clear expectations are set, transactions by foreign lenders can be completed with relatively little complications and delay.
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WHY COMMERCIAL IS ESPECIALLY IMPORTANT FOR THE REAL ESTATE MARKET BY JACKI UENG
C
ommercial real estate has typically been known as an “old boys club”, with one conjuring visuals of white men sipping scotch, closing multi-million dollar transactions over cigars at the golf course. For decades these types of images have persisted and created an air of exclusivity that a large num ber of real estate professionals did not attempt to engage. While these types of investors are still making deals in the commercial industry to day, we are seeing an influx of Asian American brokers and wom en who are at the top of the industry, killing it in commer cial real estate, especially with the advantage of overseas connections, especially from Asian countries. It’s no secret that a large number of investors have been coming from Asia, especially in the past 5 years to buy property in the U.S., most of the time in all cash. Many Asian investors, as well as investors in other continents, see the U.S. as the safest
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place to park their cash, and real estate as a wise investment. Anoth er reason is the classic “American Dream”, for the hope that their chil dren and grandchildren will be able to attend school in America (despite how much money they already have). Along with resi dential investments and luxury homes as their resident/vacation homes, many savvier in vestors are looking into commercial real estate investments for their own business expansion or the simple math of a lucrative return. In recent news, we’ve seen global investors buying office buildings such as the $200 million (4.6 acre site) pending acquisition of Fig Central in Downtown LA by a China-based company, and another by a chief exec utive of the largest commercial real estate developer in Beijing buying a huge piece of the General Motors Building. We have seen real estate investors also going into development projects, large hotels, industrial build ings, distressed properties, shopping centers, and apartment buildings. To meet this growing demand, this new school of commercial
real estate agents and brokers has arrived on the scene with growing intensity. “Overseas Asian investors would prefer development projects or distress properties. Many of the overseas investors are searching
development projects which qualify for EB-5 programs so they can also apply for permanent residency with their investments.” States Daniel Hu, who is a Senior Vice President and Asia Pacific Group Managing Partner of commercial real estate stalwart NAI Capital. “Therefore, you will see the properties are trading with lower cap rate with full cash offers in the local Asian markets, along with many development projects that are done with the EB-5 money flowing from Asia, especially from China.” This
relatively young group, with many of its members having some back ground in these areas, is well-versed in these types of deals and continues to facilitate large commercial ven tures in the county. With this continued relevance in commercial real estate, we contin ue to see a need for this side of the market to be represented in trade organizations around the country. This is why associations of AREAA have adopted commercial as one their primary points of emphasis. AREAA Commercial is a subsidiary of the organization that was estab lished 3 years ago with the vision of Kenneth Li during his term as AREAA’s National Chair. With the help of Kevin Chin, Sperry Van Ness, he spearheaded the committee as the organization’s first commercial chair. When asked about his vision for the entity, Chin states, “We are aiming to create a network of AREAA members that are also commercial real estate professionals in markets across the country that can be a resource to all AREAA members for referrals, mentorship and other business op portunities.” Summing up this vision, AREAA Commercial’s mission state ment is to provide AREAA members with educational, business develop ment, and networking opportuni ties. By accomplishing this mission,
leaders such as Chin hope to help add to the already growing group of minority and women commercial real estate professionals. In 2013, James Huang, Founder/ CEO of BRC Advisors, stepped up to the plate and has now been appoint ed as the 2014 AREAA National Commercial Chair. Alongside Peter Park, who was the 2013 President of the AREAA Greater LA chapter, Huang began to hold monthly strat egy meetings in Los Angeles with a core group of a dozen commercial real estate professionals from NAI Capital, CBRE, Marcus & Millichap, BRC Advisors, and Capital Invest ment Advisors. The goals of these meetings were to collectively brain storm innovative ways to accomplish the objectives set out by AREAA Commercial as a whole, while even closing a few large deals among the group. As a result of these meetings, they’ve established positions such as a vice-chair, regional chair, secretary, and an advisory board. The committee’s goals for 2013 will be focused on education, networking, and referrals. As most of AREAA’s membership practices residential real estate, AREAA Com mercial will be putting on quarterly webinars acting as an introduction to members looking to begin pursuing commercial leads. In tangent with
the introductory class will be a mentorship program where members will be given the opportunity to work under seasoned commercial agents in different regions across the county. Since its inception, AREAA Commercial has continued to evolve in a positive direction. What began as a vision of an AREAA national chair has developed into one of the organization’s few standing commit tees. Events and initiatives put on by AREAA commercial command a large audience established as well as prospective members looking to transition over to commercial real estate transactions. As a result, entities like these are providing the commercial market with a new breed of professionals previously under-represented in these types of real estate transactions.
Overseas Asian investors would prefer development projects or distress properties. Many of the overseas investors are searching development projects which qualify for EB-5 programs so they can also apply for permanent residency with their investments.
Daniel Hu NAI Capital
Jacki Ueng is the VP in Business Development at Ticor Title Company. With over 7 years of experience, she has closed over a billion dollars in commercial real estate deals. She is also the AREAA National Media Correspondent, member of the 2014 Edge Committee, and sits on the AREAA Commercial Board as the Executive Secretary. SPRING 2014
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Join AREAA in Seoul, Korea END
OF
SEPTEMBER,
2014
Join AREAA in Korea and take advantage of the opportunity to expand your global reach. T O PA R T I C I PAT E O R L E A R N M O R E D E TA I L S A B O U T T H E T R A D E M I S S I O N , C O N TA C T: P E T E R PA R K : p e t e r p a r k @ p e t e r p a r k r e . c o m | C A L L : 3 2 3 . 8 1 0 . 1 5 6 5 CHARLIE SUH: charliesuhrealtor@gmail.com | CALL: 818.482.1314
www.areaa.org
AREA A BUSINESS NETWORK
CALIFORNIA Your San Diego Connection
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CEO - The Estates Group Keller Williams Luxury Homes International 19300 Rinaldi St Ste L Porter Ranch-Northridge, CA 91326 (818) 491-4557 Office (626) 203-2904 Text (818) 638-7811 eFax CindyEstates@gmail.com www.CindyEstates.com Serving San Fernando Valley & The Greater Los Angeles Full Service For Your Real Estate Needs in United States and Globally #1 Female Agent, KW Porter Ranch 2013
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Billee Spodek
Nextage M3 Realty 1910 Oak Tree Road Edison, NJ 08820 (732) 603-0700 Office (732) 877-8009 Cell Meiling@NextageRealty.com www.NextageM3Realty.com
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Servicing Central NJ Including: Middlesex County – Edison; Mercer County – Princeton; Hudson County – Jersey City/Hoboken
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Broker/Owner AREAA New Jersey Chapter President
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PRAVEEN SHARMA psharma@areaa.org | 951-514-1053 SPRING 2014
49
MANAGE YOUR INTERNATIONAL PROFILE with
PROXIO BY JOHN PERETZ
As a real estate professional, finding business internationally can prove to be a difficult task.
Finding these types of leads can be both frustrating and timeconsuming, especially to agents and brokers looking to break into this niche market. Although this can seem to be a daunting endeavor at first, real estate professionals can take advantage of a number of tools to connect themselves to global real estate. To provide members with such tools, AREAA has entered into a partnership with Proxio so that members are able to utilize the brand’s international networking platform. Proxio, a free service provid ed with AREAA membership, is a professional network that works in concert with a world-wide Multiple Listing Service (MLS). As a result, this service provides the best aspects of social networking sites such as Linkedin and real estate listing ser vices to essentially create a “one-stop shopping” experience for real estate agents and brokers. Like traditional social media outlets, Proxio provides a profile for each member. However, the service also translates listings into 19 languages and 55 currencies.
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Services such as Proxio signify the emerging trends of utilizing technology to capture unprecedent ed amounts of real estate listings, which has seen increased referrals as well as more opportunities for individual agents to gain substantial visibility around the world. When agents start using this service, they are able to build global connections at rates that were not possible in previous years. As economic activity around the world is becoming more connected, professionals looking to grow their businesses must be able to make international connections. With ser vices like Proxio, agents can instantly translate listings from anywhere in the world to create marketing flyers in a range of languages. When these agents add their own listings to the services’ International MLS, they are providing a consolidated layer of exposure that sellers from around the world anticipate. According to a recent NAR study detailing mar ket trends in times of uncertainty, customers have an unprecedented amount of listing information and data available to them. As a result, potential buyers are faced with an overwhelming amount of infor mation that runs the risk of being inaccurate or misleading. With this in mind, simplification is very important in presenting data to the potential clientele bases. Profes sionals using such services as Proxio will possess a distinct advantage by
BECOME A GLOBAL AGENT IN
3
EASY STEPS
1.
Log into AREAA.org and go to the Member Dashboard
2.
Complete your Proxio Profile
3.
Start Connecting with other Agents
presenting a streamlined networking and listing service to a large amount of people. Another aspect of simplifying means of technological communi cation lies in managing a cohesive presence in social media. Proxio’s SocialSearch Facebook application works to complement an agent’s web presence, which in turn allows potential buyers to search the entire international MLS directly from an agents Facebook page. Although this garners an additional fee for members of AREAA, this is one of the service’s most popular features as it consolidates an agent’s online presence amid an age of saturated information. For real estate professionals looking to separate themselves from those unwilling to engage in technology, Proxio and AREAA are providing members with such tools and opportunities. AREAA members are among the leading real estate professionals in global real estate, and the features provided by such services as Proxio gives members one more seamless way to connect, refer and close international and multicultural sales.
For more information, visit
ProxioWorld.com/AREAA
GREATER CHICAGO INSTALLATION GALA
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The Chicago chapter celebrated the New Year on Wednesday January 29th, 2014 with a gala event installing the chapter’s Board of Directors. The 2014 AREAA National Chair, Ivan Choi, braved Chicago’s brutal winter weather to join the festivities and welcome the new Board. The event was attended by over 125 AREAA members from Chicago, Indiana, and Milwaukee. This event was generously supported by corporate sponsors, affiliates, and many other Chicago real estate organizations. Liz Goodchild, the 2014 Chicago Chapter President, took the opportunity to highlight the chapter’s calendar of events for the coming year, including LEAP’s (AREAA Leadership Training) March 6&7 events as well as the Freddie Mac partnership event in May. Judging from the enthusiasm of the crowd during the January 29th event, the Chicago chapter expects a great year! Photos: James Park
AREAA WA UPDATE A busy 4th quarter kicked off with a name change for the chapter. The chapter has very recently taken on the name of AREAA Greater Seattle. As the chapter has continued to grow, its leaders felt it was best to single in on the Seattle region and continue the tremendous growth seen throughout the last few years. In November the chapter held a daylong seminar entitled, Increase Your Business Working with Foreign Buyers. Sessions included discussions on the EB-5 Visa Program and its complexity by Michael Streit of Streit & Su Attorneys at Law. HSBC’s VP of Specialized Sales, Rhonda Munoz, also discussed financing for foreign buyers while Washington Realtors President, Mark Kitabayashi, shared the economic data regarding purchases made by foreign buyers. Additionally, Mary Vigal from theCondado Group shared insights on tax issues for foreigners looking to purchase real estate
in the country. Additionally, a very entertaining discussion by Joseph Ho of Berkshire Hathaway Home Services detailed the typical Chinese buyer and why Seattle real estate is such an attractive market for these investors. In his discussion, Ho remarked that Sleepless in Seattle must have made a lasting impression on Chinese moviegoers and filmmakers alike as a new romantic comedy titled “Beijing Meets Seattle” (北京遇上西雅图) in Chinese, or Finding Mr. Right in English has
buyers flocking to Seattle to experience the city. Recently elected 2014 National Chair, Ivan Choi, capped a great day by telling attendees the benefits of AREAA and took donations for the Philippine Relief Fund. AREAA Greater Seattle capped an amazing year of growth with a holiday celebration and networking mixer that was attended by over 75 people on December 12th. Photos: Carrie Callaway
AREAA LAS VEGAS LUNAR NEW YEAR CELEBRATION On January 30, AREAA Las Vegas celebrated its 3rd annual Lunar New Year celebration at the Downtown Grand, a stylish new hotel and casino located in the heart of Downtown Las Vegas. The evening started with handcrafted Absolut Elyx cocktails at the Art Bar, followed by dinner and an awards ceremony in the grand ballroom. Sherwin Escanuela and Jim Park then made welcoming remarks. AREAA National President Ivan Choi and SVP of One Queensridge Place and AREAA Las Vegas President Randy Char honored Las Vegas’ top real estate sales executives with awards and 52
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each honoree received an engraved bottle of the luxury vodka Absolut Elyx. Awards for the top real estate producers went to Randy Char, Eleanor Cheng, Vandana Chima, among others. Awards for the most influential people in the community went to Rone Chang, Kathy Chu, Helen Hsueh, Joseph Lee, and Robert Macabagdal. Guests finished with a live performance by the Jeremy Cornwell Project at the Mob Bar. Proceeds of the event benefited the Philippine typhoon relief effort. Special thanks for this event go to FirstCal Mortgage, The Signing Depot, and Mutual of Omaha.
亞裔不動产協會美東分會歡迎所有的國際朋友參加我們的2014年度全球不動產高峰會! [我們的高峰會宗旨在設定全新的高桿標準] 美東分會很願意做您在美國的服務橋梁! AREAA New York East was established and Inaugurated in August 2013. We: •Advocate for policy positions at the local as well as national level that will reduce homeownership barriers facing the APA community. • Advance Homeownership & Global Real Estate Investment. Who We Are - Our chapter was formed to better serve the population in Queens as well Nassau and Suffolk counties. With over 5.2 million people, this region accounts for about 52% of the population in the 5 boroughs and Long Island. Airports, bridges, tunnels and railroads connect Queens, Nassau and Suffolk counties with not only the rest of New York City and the US but with the rest of the world as well. A surge in international interest in US properties will provide opportunity for our business to grow but at the same time we must be ready to meet the challenges of working with foreign buyers. We are honored and excited to have signed the Memorandum of Understanding Agreement with the Taipei Association of Real Estate Brokers, a prime example of partnering with our global neighbors. We are also in partnership with many local & Global nor-for profit, business, banking & financing organizations. Please call us for details: 中英文:Katie at (917)-882-8070, Amanda (516)-949-9077, Irene (646)-6374163, and Sandy (516)-495-0898; 粵英文 Richard (718-886-8383); 日英文:Yoshi at (646)-529-2168; or 英文Liz at (631)-922-4822; David (718)-475-2800 Shawn (516)-516)364-4663; 西英文:Cristina (516)-330-3299, 韓英文 Jimmy (917)-482-0000. Email: areaaNYeast@gmail.com
AREAA ALOHA CHAPTER 1 ST ANNUAL INSTALLATION GALA AREAA Aloha Chapter of Hawaii held the First Annual Installation Gala on January 24th at the Modern Honolulu. Guests enjoyed a seminar about Chinese real estate matters prior to the launch event. VIP guests included AREAA Founding Chair Allen Okamoto and Mayor Kirk Caldwell’s representative Ms. Minnie Ko. The Launch kicked off with Allen Okamoto’s speech and AREAA’s 10 year anniversary video followed by a Lion Dance to celebrate Chinese New Year. The installation of the Board of Directors and Officers was complemented by spectacular fireworks. Over 150 people attended and networked at the event. Photos: Brandon Tabiolo
AROUND
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E WRIT
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To have your news, awards, good work and accomplishments considered for publication in future editions of a|r|e magazine, contact Michael Kelly at:
mkelly@areaa.org 2014 AREAA N AT I O N A L E V E N T S
DALLAS FORT-WORTH INSTALLATION On January 24th, AREAA Dallas Fort-Worth celebrated their 5th year anniversary. This sold out event created a wonderful environment with strategic partners, AREAA members, great food, entertainment and a Lion Dance proudly bringing in the Lunar New Year. This event was dedicated to the organization’s 10 year anniversary, as the chapter showcased the AREAA’s 10 year anniversary video so that local members can gain a newfound sense of appreciation for the origins of the organization. AREAA Dallas Fort Worth is excited about expanding its Board for 2014. The executive board for 2014 has Dionne Cuello serving a 2nd term as President, Michael Seeto as Vice President, Beth Rogers as Secretary, Kelley Liu as Treasurer, and William Tsao as Chancellor. In addition, the Board wouldn’t be complete without the Board of Directors, which includes Cathy Capps, Godwin Tsui, Derek Shaw, Trang Dang-Le, Daniel Eng, Calvin Wong, & Eric Chen. Photos: Thoa Nyugen
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N AT I O N A L P O L I C Y D AY M AY 5 - 6 , 2 0 1 4 WA S H I N GT O N , D .C .
N AT I O N A L CONVENTION SE PTEM BER 5 - 8 , 2 014 LAS VEGAS, NV
VIEW LOCAL AND NATIONAL EVENT S O NLI NE AT:
www.areaa.org
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