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July 30, 2012

1st China-focused US real estate group targets the market

People's Daily Online

Recently, Kidder Mathews, a well-known commercial real estate firm in California, announced that a Chinese clients-focused group, or the China Services Group (CSG), was officially established. It is the only China-focused cross-Pacific real estate group in the United States.

Composed of real estate professionals fluent in English and Mandarin, CSG is focusing on serving Chinese investment enterprises to the United States.

The founder of this special group, Skip Whitney, a businessman working in the China space for 30 years, was interviewed by reporters from People's Daily Online in his Kidder Mathews office in San Francisco's financial district. He has been serving the various needs of Chinese business people for over 30 years.

According to data from China's Ministry of Commerce, in 2011, Sino-U.S. bilateral trade volume amounted to 446.7 billion USD, representing a 15.9 percent increase over 2010. Chinese enterprises directly invested 6 billion USD in the U.S. market. As one of the premier overseas investment destinations for Chinese enterprises, the U.S. market continues to witness increasingly strong Chinese investment and competition.

As an experienced real estate expert, Skip first visited China 30 years ago and has been engaging in China-related work since then. He is also a co-founder of ChinaSF, the Bay Area Council China Initiative and other institutions. Earlier this year, Skip was entrusted with setting up the trans-Pacific portal for the Kidder Mathews China Services Group. With over $1.9 billion in annual business and over 22 million square feet in its portfolio, Kidder Mathews is one of the biggest commercial property agents on the West Coast.

The purpose of setting up CSG, according to Skip, is to meet the "increasing flow -- both business-wise and personal-wise -- between China and US." CSG offers advisory, brokerage and property management services to Chinese companies looking to invest in the United States, and vice-versa.

The U.S. market is the world's largest and most complex. For those Chinese companies new to the U.S, "they will encounter a large number of difficulties, like language and communication barriers," says Skip. "Many will be inexperienced in American law and also differences in the market, different SINO-US national conditions and the East-West cultural divergence." As a veteran of many cross-Pacific business deals, Skip has a thorough understanding of the challenges with which many Chinese enterprises will be faced.

Utilizing the expertise and connections brought to the table by Skip and Kidder Mathews, in the last two years a dozen Chinese companies have found superior Bay Area space. Among those success stories: GCL-Poly Energy Holdings, Ltd., and InnoSpring, the first US/Chinese technology incubator in Silicon Valley.

"After my 30 years of experience in China, I am happy to say Kidder Mathews' China Services Group is a reflection of doing business between US and China," said Skip.

Part of the successful team overseen by Skip is the Philadelphia-based real estate brokerage, Binswanger in addition to Synergis, a property management firm proud of its listing on the Hong Kong stock exchange.

"The China Services Group, together with the help of the alliance with Binswanger and Synergis, can perfectly serve not only commercial real estate interests, but also residential and lifestyle." Skip added.

Traditionally, Chinese place a strong emphasis on family and education, so the quality and security of the community to which business people move, including access to superior school districts, are important factors for Chinese investors and companies when purchasing real estate. Kidder Mathews's CSG group has a comprehensive understanding of Chinese culture and the priorities Chinese business people.

Skip believes his job is "to make sure those Chinese families and businesses that are interested in coming to San Francisco are well taken care of."

"Since so many inbound clients are not fluent in Chinese, it's important for CSG to make these clients comfortable," He added.

As the leader of the China-focused real estate group, Skip is convinced that forming CSG has been a wise decision. The progress is visible - and audible: in less than two years, Kidder Mathews has expanded its staff to include three Chinese born native Mandarin speakers. During the interview, Skip also offered advices for Chinese investment enterprises coming to the U.S.

"Find the right partner and cooperate with U.S. local companies as much as possible," he said. According to Skip, laws and regulations are quite different in the United States. Not only those of the federal government, but also those of individual states whose provisions may sometime vary from the federal authorities. Newly entered Chinese enterprises should seek out partners with local companies to figure out the "rules of the game" first, instead of blindly guessing and possibly making expensive mistakes.

He offers some advice to avoid the pitfalls:

"Find a professional service." Skip pointed out that utilizing professionals who understand the market well is the key to a successful future for Chinese companies coming to the U.S. market. There are not only huge differences in the culture, but also in the market and legal system between China and America.

"For example, lawyers in America play more functional roles in the commercial market than in China." Skip particularly suggested that Chinese companies take advantages of local law firms, accounting firms and other professional services to avoid risks.

"Do your homework, make friends and do the right thing," Skip advised that many Chinese companies lack a strong strategic plan when entering the U.S. market. He said rigorous homework and clear plans are essential to success.

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