Shan-Jie Li wants to do something about it. The developer from the city of Linyi in China’s wintry northeast aims to make Florida’s most-populous metropolitan area, with its clean beaches and tropical climate, a destination for Chinese property investors.
“We are focused on bringing to Miami the new wave of Chinese who are wealthy and educated,” Li said in a phone interview via a translator. “The environment in Miami makes for a very suitable lifestyle. Playing golf and going to the beach are huge attractions.”
While Miami’s rebound from the financial crisis was driven by South Americans snapping up vacant condos, the city now is looking as far as Beijing to sustain the growth. Chinese have become one of the fastest-growing segments of foreign buyers, according to the Miami Association of Realtors, as the weakening Argentine peso, Brazilian real and Russian ruble discouraged investment from those countries.
“Property values have gone up, and the currencies shifted in the other direction,” Daniel de la Vega, president of luxury real estate broker One Sotheby’s, said in an interview in Miami. “So South American investors may look at us and say it’s not as good of an opportunity.”
Since the depths of the crisis, when downtown vacancy rates climbed to 60%, cranes have returned to the skyline and property values have surged. A $131 million modern-art museum backed by Jorge Perez, billionaire owner of Related Group, opened in 2013; a science museum is under construction next door along the Biscayne Bay waterfront.
Latin American buyers made up 62% of purchases in Miami last year, led by Venezuelans, Argentines, Brazilians and Colombians, according to the Realtors’ association. They helped drive the median home price to $276,000 in December, up 54% from $179,000 at the end of 2011, according to real estate website Zillow.com.
“We have quite a number of Chinese buyers; it’s not even 5% of the total but it’s growing,” Perez said. After he gave a recent speech to University of Miami students, Chinese parents of one pupil bought $20 million in real estate, he recalled. “Russia had been a good source of buyers, particularly in beach locations, and we’re seeing it decline,” he added. “I have no idea if South Americans will continue to buy as before.”
Armando Codina, executive chairman of developer Codina Partners, isn’t taking chances. He sent a representative to Beijing to shore up sales at his $1 billion Downtown Doral project, which comprises a master plan for a new downtown, including a city hall and school in an area of northwest Miami-Dade County.
“We are seeing some Chinese-buyer activity that we never expected,” said the Cuba-born Codina, whose project is adjacent to Blue Monster golf course at Trump National Doral hotel. “Chinese get this project in two seconds, because they’ve seen cities emerge out of nowhere.”
NR Investments produced a promotional video in Mandarin to lure Chinese buyers to its Canvas condominium development in an area better known for parking lots and low-rise buildings between downtown and the design district.
“Everybody wants a piece of Miami now,” said Ron Gottesmann, a principal at the company. “This is the beginning of the change.”
If only there were more noodle shops.
“There are not enough Chinese restaurants, supermarkets and spas in Miami’s supply chain,” said Li, head of American Da Tang Group, a partner of state-run China City Construction. “These are challenges that must be overcome. We want to put in new restaurants and services that can cater to Chinese as well as everyone else.”
On a visit last year, Li donned a Panama hat and white blazer as he slung his arm around local executives and ex-Florida governor Charlie Crist. His company then scooped a downtown lot out of bankruptcy with $75 million.
While Chinese media have been hyping Miami as a real estate destination — one outlet said that Chinese investors are “flocking” to the city — the realtors’ association numbers show that they still account for a fraction of purchases: 3%. Expansion in the world’s second-largest economy is the slowest in 25 years as President Xi Jinping wages the broadest corruption crackdown in decades.
“It’s not such a significant number of Chinese folks that are buying retail,” said Francisco Cerezo, a partner at the law firm Foley & Lardner who advises wealthy Latin American families. “It’s nothing like the number of Brazilians who had been establishing second homes.”
Besides culinary shortcomings, the biggest challenge to attracting Chinese buyers is the absence of a nonstop flight, Li said. And while the U.S. and China will start granting 10-year visas to each other’s citizens, the nearest Chinese consulate remains in Washington, he said.
Even so, Miami’s Chinese population is reaching critical mass, says Mikki Canton, a Cuba-born corporate lawyer. She’s so sure the city is ripe for its own Chinatown that she has trademarked the names Chinatown Miami and El Barrio Chino de Miami.
Asian-Americans were the fastest-growing racial group in the Miami metropolitan area from 2000 to 2010, expanding 47% to 158,400 residents — out of 5.6 million — according to U.S. Census Bureau data analyzed by the nonprofit Asian-Americans Advancing Justice. The Chinese population — spread through Palm Beach, Broward and Miami-Dade counties — grew 32% to 35,700, trailing only Indians among Asian ethnic groups. Foreign-born Chinese grew 67% from 2006 to 2010.
“I have always had the dream of having a Chinatown,” said Canton. “Not just for tourist purposes, but a true, organic Chinatown.”
Developer Li, for his part, says he’s not only appealing to Chinese buyers in an increasingly cosmopolitan city. Indian and Japanese restaurants are cropping up. Miami jumped to No. 7 in the Knight Frank ranking of top homes for the wealthy.
“I’m well aware that this is the first entry of Chinese investors to downtown Miami,” said Li, whose company’s lot is in the Brickell neighborhood near a $1 billion project by Hong Kong-based Swire Properties Ltd. “I’m keen to make a signature building that is a landmark.
Source: Asian In Miami