China Targets The Ritz-Carlton Residences, Singer Island, Palm Beach
Largely quiet for much of the real estate rebound in Florida, Chinese buyers are beginning to consider residential investments in the area.
“It’s the first wave [of Chinese buyers],” said Ophir Sternberg, managing partner at Lionheart Capital, which owns the Ritz-Carlton Residences Palm Beach. “We think a lot of this is due to the recent downturn in the real estate market in China in the last couple of quarters. People that made a lot of money in China are now looking overseas to invest their money, and buy some prime real estate.”
Meridian Investment Group co-owner Carolyn Block-Ellert, who is leading sales at the property, said the Ritz-Carlton had already completed several deals with buyers from China, and had begun developing a relationship with a master broker in Shanghai who is helping the project with marketing in that country.
“We’ve worked with our contacts to actually participate in events in Beijing, and we’re promoting and educating qualified potential prospects, leaders, and promoters [in China],” she said, noting that Ritz-Carlton was already a well-established brand in the country.
But the new Chinese buyer isn’t coming just for a place in which to invest her money. Many Chinese real estate buyers are also interested in obtaining the coveted EB5 Visa, which can entitle them to residency in the U.S.
Coral Gables-based Coldwell Banker Realtor Jeanne Nicastri said she had heard from a number of developers who had gone to China and Singapore looking to attract investments of $500,000 in their projects — the threshold for obtaining an EB5.
“I would say the main reason they’re interested in coming to the U.S. is for the visa, and a secondary interest is to choose a city that’s really interesting — with New York at the top of the list, and Florida next on the list.”
Nicastri said she had been working with Margaret Liu, a broker in New York City, one of the main entry points for Chinese buyers to the U.S., to facilitate deals in Florida.
Liu, owner of Battery Park Realty in New York, said another factor driving the trend was a recent policy change in China that limited the number of real estate units that can be purchased — most notably Beijing.
“A lot of the people who are coming are wealthy people cannot keep buying,” Liu said. “Another point is that everybody made their money [in China] and wants to put it in a safe transfer, or for their kids, who are coming over to study.”
Just how much Chinese investment eventually comes to South Florida is unclear.
Generally, Nicastri said, Chinese buyers like to purchase where there is already an entrenched Chinese community, with Chinese people and Chinese restaurants — something which South Florida lacks right now.
But they’re also influenced by their friends, she said, and the more Chinese buyers that decide to make the move, the more that could join them.
“Although we’re a long way from China, we have become very trendy, and we’re on the trendy map,” Nicastri said. “Since they’re already involved in New York, and Miami is an offshoot of New York, that’s what’s driving them to come here.”
One X-factor is the Genting casino resort project in downtown Miami.
“If the Genting project breaks ground, and especially if the gaming gets approved, I think that will create a real rush of Chinese buyers into South Florida,” Sternberg said. “But right now what we’re seeing is the first trickle.”.
Written by Alexander Britell for TheRealDeal.com