Chinese Investors Pouring Money Into Myrtle Beach

Posted: December 23, 2014 in Econ 101, Free Trade, Society and Culture

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Chinese investors pouring money into Myrtle Beach area

By Steve Jones

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MYRTLE BEACH, S.C. – Grand Stranders agape over the tens of millions of dollars Chinese investors have paid for area golf courses in the last few years likely don’t appreciate that it may be just the beginning of a pipeline that some area leaders and organizations are working to create with one of the world’s oldest cultures.

“I think in the next five years you will see a bigger (development) explosion than what you see right now,” Myrtle Beach Mayor John Rhodes told a group of area Realtors at a breakfast last week at the Dunes Club.

Rhodes was fresh from his latest trip to China and told his audience at the Commercial Investment Division of the Coastal Carolinas Association of Realtors that he had recently spoken in Myrtle Beach with a group of Chinese investors who want to spend $200 million along the Grand Strand in the next year.

“When they come in and see something they like, they don’t go to the bank,” he said. “They pay cash.”

Rhodes’ most recent trip, Oct. 21 to Nov. 2 when he and Myrtle Beach Area Chamber of Commerce CEO Brad Dean attended the China-U.S. Leadership Summit, was jointly funded by the chamber. The city also paid an additional $1,300 of the total trip cost because Rhodes also talked with playground equipment manufacturers while in China.

Investors from China have been scooping up area golf courses. They’ve spent about $50 million over the last 18 months for courses on the Grand Strand and in Brunswick County, N.C., about $40 million of that in the last three months.

Besides the golf courses, Chinese have purchased at least one Grand Strand hotel and the former Waccamaw Pottery, which they bought in late 2011 for about $8 million, Rhodes said.

While Rhodes’ ventures into China have been the best publicized of the local outreach, the Myrtle Beach Area Chamber of Commerce, Myrtle Beach Golf Holiday and Coastal Carolina University have also been working to establish relationships in China.

Myrtle Beach Golf Holiday participated in a golf show in China a few years ago and is working on sponsorship of a golf tournament there, according to Dean. Bill Golden, Golf Holiday president, couldn’t be reached for comment.

The chamber has produced nine videos about the Strand using a native-speaking Chinese hostess.

Additionally, the chamber paid CCTV, China’s largest cable TV network, for a portion of its cost to produce a show on travel to four U.S. cities, one of which was Myrtle Beach. The CCTV show is scheduled to be broadcast next year and will also be shown on flights of China Southern Airlines.

It also has produced digital ads for Weibo, China’s version of Facebook, and a brochure in Mandarin, the country’s main dialect.

Dean said the chamber spent $9,000 for its CCTV participation and video production. Since 2012, it’s spent $55,000 on promotions in China.

CCU, though, may be the most immersed in its segment of Chinese society. It has had programs with China since 2009 that have brought Chinese students and professors to Conway and sent CCU faculty to China.

Darla Domke-Damonte, CCU’s associate provost of global initiatives, said the university is one of 24 in the U.S. that is a member of the Sino-American Consortium for Higher Education and Professional Development, which includes more than 100 Chinese colleges and universities.

Domke-Damonte said the Chinese believe in an experiential learning approach and have sent students here for hospitality internships, one of whom won a regional Addy Award with his internship work.

“The experience they have in producing things helpful to their profession is quite important to them,” she said.

The Chinese like CCU because it is accredited, but also because to the Chinese it represents a bit of Americana that they won’t find in major U.S. cities, she said.

“We’re not New York,” Domke-Damonte said.

The university now has a Chinese Club that holds a celebration of the Chinese New Year as part of CCU’s Spring Festival.

Domke-Damonte and Rhodes said that Americans need to know and appreciate the ways Chinese form relationships and how they do business.

“Part of what I think they’re looking at is are you here to really be here or are you here to just be passing through,” Domke-Damonte said.

She said that CCU has been praised by China’s education leadership for its programs with Chinese. Among other things, she said the Chinese appreciate that CCU is sending its faculty to China and that it gives realistic feedback of the interchange programs.

Chinese investors like to have things that are bigger than everybody else’s things, Rhodes said. For instance, he said they’d like to put up 50-story resorts on the beach, which likely wouldn’t get building permits because the sand couldn’t support them.

In that case, said Lui Cheng, a commercial sales executive in Myrtle Beach, the investor will want to have the most land for his or her oceanfront investment.

“Instead of buying one acre,” he said, “they’ll want to buy 10 acres.”

Cheng said it’s key to understand that in China, the government owns all the land so developers, industrialists and homeowners rent the property they occupy. As a result, they have a strong desire to have land they control outright.

“The key selling point is ownership,” he said.

Rhodes said the Grand Strand needs to educate Chinese about the beach, which the outreach from Golf Holiday, the chamber and CCU all do in part.

Chinese investors know about Los Angeles, New York and Chicago, Rhodes said, but Myrtle Beach “is the size of a neighborhood.”

Likewise, Rhodes said it’s a mistake to clump all Chinese into any kind of preconceived basket.

“They’re very proud,” he said.

Rhodes said that the Grand Strand market will have to sell itself to the Chinese because they’re not going to come looking for it. Further, he said it’s a mistake to try to pressure an Asian investor.

“Don’t discount them because they’re not like us,” he said. “that’s one thing we’ve got to understand. Not everybody is like us.”

SOURCE:  http://www.charlotteobserver.com/2014/12/21/5399205/chinese-investors-pouring-money.html

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