New York reaches out to China
By Janice Fioravante
NEW YORK - Like the title of the Elvis Presley movie Kissing Cousins,
China and New York are in the serious courting stage.
New York will play host to a prime showcase of Chinese merchandise when
construction starts this month on a new complex. The Grandland Expo Center will
be based in a 120,000-square-foot (11,150-square-meter) building in East
Elmhurst in Queens, the most multicultural borough of New York City. The
Fujian-based firm, Grandland, purchased the building as part of a US$46 million
investment.
Yuet-fung Ho, vice president of the international business development (Asia)
group for the New York City Economic Development Corp (NYCEDC), is given much
of the credit for her involvement, skills, language and perseverance for the
"win" of this export and import distribution project.
It is just one endpoint to the hours and hours of work on the part of NYCEDC
and others, including state Governor George Pataki and New York Mayor Michael
Bloomberg, all having traveled to China many times over the past three years to
meet face to face with key representatives there.
In fact, Ho, who grew up in Hong Kong and previously opened the CBS (Columbia
Broadcasting System) Broadcast International office there, sees the increased
travel to China, "coupled with the rising talent level from China over the past
five to 10 years", as having "set up an environment for soaring interest in
business exchange between New York, and the United States generally, and
China".
"More business executives in China have the economic interest, knowledge and
international experience," Ho continued. "They have the urge and the experience
to take on leadership roles, including a level of expertise and a willingness
to facilitate overseas business, with a willingness to employ management teams
and work with universities to grow more leaders and managers."
The interest and expertise on both sides of the Pacific are paying off. Another
project, The China Center, is in the works from the Vantone Group. The Beijing
company wants the center to serve as a hub for Chinese companies locating
offices in New York and for international and US firms interested in investing
in China. Vantone, one of China's largest private real-estate developers, has
agreed to the basic terms of leasing at least 200,000 square feet (18,580
square meters) of office space.
"We are pleased to be building a bridge between the Chinese and US business and
cultural communities," said company chairman Lun Feng. "There is no better
place to enter a future together than from Lower Manhattan. The China Center
will be both a business and cultural destination, providing a platform to
nurture mutually beneficial dialogue."
EDC first met with the Vantone Group in June 2004. Over the next two years it
worked closely with the firm on its vision of a China Center in New York to
serve as a first home for Chinese companies in the US, as well as providing
business services, cultural and recreational facilities.
Laure Aubuchon, who as senior vice president oversees New York's international
business development efforts at NYCEDC, explained that although plans to locate
the China Center at 7 World Trade Center fell through when Feng and Larry
Silverstein of Silverstein Properties failed to come to agreement, she knows
that chairman Feng is committed to making the business and cultural facility
representing China's dynamic business community happen.
"On the same trip that Yuet and I traveled to Fujian province, we also had
meetings in Beijing and brought along representatives of Jones Lang LaSalle,
the real-estate broker in New York that's representing Beijing Vantone in this
venture. We know that Vantone wants to move forward on this," Aubuchon said.
The New York City Investment Fund, the economic-development arm of the
Partnership for New York City, a non-profit coalition of the city's leading
businesses, has committed up to $3 million to help fund the China Center. The
Partnership and the Fund have worked closely with the city and the state to
strengthen New York-Chinese business relationships and to encourage Chinese
companies to locate their international headquarters in New York City. Meetings
in Beijing between the Vantone Group and New York City business leaders and
government officials have worked to encourage Chinese support for the project.
Aubuchon said she sees that both country's governments are ready for
globalization. And she knows what she's talking about. Aubuchon was director of
business development in Hong Kong for the Specialty Chemicals Group of WR Grace
and then vice president of international sales and marketing for Baker &
Taylor, the company's wholesale book division. She also was director of sales
and marketing for Ernst & Young's international tax and legal services
practices.
"I lived in Hong Kong and I remember going to Shanghai in 1986, where there was
just one-half of a Western hotel and that's it," she said. "In the past two
years especially, it seems that the popular press has discovered China and now,
with outsourcing, India, too."
Aubuchon pointed out that the Bloomberg administration hired NYCEDC president
Andrew Alper from Goldman Sachs and that he divided operations at EDC to mirror
an investment bank.
"He introduced the international business desk in 2003, and our group has been
extraordinarily proactive and meeting with more than 500 companies in 26
international cities in the effort to attract foreign companies to New York
City," Aubuchon said. Many of those trips have been to China.
And once back to New York, Aubuchon and her team don't forget their "client".
"We shepherded Fuijan-based Grandland representatives as they went to
real-estate-broker meetings and even visited the 10 properties with them,
because we want the Grandland Expo Center to be a success," said Aubuchon, who
gives much of the credit to her travels and work with Ho. "Even though we've
gone to China together, I'd say 98-99% of the credit goes to Yuet."
The Grandland Expo Center will contain 200 merchandise showrooms, 360 square
feet (33 square meters) each, with an estimated 700 people expected to be
employed.
"A back-of-the-envelope number is an estimated two to five jobs per merchant
will be created to staff the booths," she explained. The Center is scheduled to
open next June.
Ho is responsible for developing a strategy to attract and retain Asian
businesses to locate in New York by promoting the city's business districts. In
managing New York's relationships with Asian businesses, she acts as their
advocate in government, encouraging firms to invest and expand in all five
boroughs. She graduated from New Asia College, Chinese University of Hong Kong.
The idea is to use this [facility] as a prototype for other provinces. "We have
potential vendors and are meeting with a third province, with a second close to
being committed," said Aubuchon. "We want to flood the provinces with
information until every provincial government wants to be here in New York. It
could be like a permanent trade show here."
She said bilingual services are available in the Queens area, which has a large
Asian population - 32% of Queens' population is Chinese, according to the 2000
census. And that number, 139,820, is 38.7% of the city's total Chinese
population.
"Because of this, I think New Jersey would have been hard pressed to be able to
offer the critical mass of support services that Queens can," said Aubuchon in
explaining why New York won instead of another proposed site for the Grandland
Expo Center, across the Hudson River in New Jersey.
A second Chinese-merchandise mart, the International Outlet Exchange, is
planned for Jamaica, Queens, near John F Kennedy International Airport, where a
300,000-square-foot (27,870-square-meter) trade-center building is envisaged.
It is expected to have the same scope of the Grandland operation. This second
mart could well open the path for representative marts from every major
exporting province in China.
This proposed project is to facilitate US small and medium-sized companies
exporting their goods and services through distributorship agreements to China,
as well as India and South Korea, according to Myles Matthews, president and
chief executive officer of the Global Trade and Technology Center in New York,
which is working to see the International Outlet Exchange happen.
"The main issue has been that the Chinese investors must own the property for
this project, as well as the facility on it," said Matthews. "While they will
be investing $1 million, the ownership is an asset and a long-term lease is a
liability."
NYCEDC's analysis indicates that this project in the first year will generate
1,200 permanent jobs and by Year 3 will generate 3,000-5,000 permanent jobs, he
continued, saying that is why all concerned are trying to keep this project in
New York City. "We're looking to service small and medium-sized companies
throughout North America, possibly import goods and services firms to export to
China, and India and Korea as well.
"It would be misleading if I didn't indicate that once this project is
operational, that there will be American small and medium-sized businesses that
will be interested in importing goods and services from China, India and
Korea," continued Matthews.
This one-stop shop will make it possible for companies unable to go on trade
missions to China, India and South Korea to have an alternative where they will
be able to create distributorship agreements, he said.
Other NYCEDC efforts in the pipeline for the coming year include Shanghai Media
Enterprises, a top media company working with New York University and the New
York Film Academy, looking to set up professional training programs in media.
There is a possible investment opportunity in real estate for a media center.
A top Chinese pharmaceutical company, Neptunus Group of China, which is listed
on Nasdaq, is looking for partnership in New York. The company has a
chain-store subsidiary that has 1,500 retail stores in China.
In the coming year, New York and China look to be taking further steps, leaving Kissing
Cousins behind and cozying up to Married With Children.
Janice Fioravante is a New York-based correspondent.
