An adventure going on
This blog linked with a real estate agency in Beijing would have something flawed if no word was said about the most emblematic real estate tycoons in Beijing. If most of real estate entrepreneurs in China try to remain in the shadow to benefit quietly from the huge amounts of money accumulated through the fast growing market of a country that has doubled its GDP in the last 30 years, there is definitely one couple that made an exception to this rule.
Zhang Xin and Pan Shiyi married in 1995, the same year they founded the company SOHO Beijing. Since then they have been redesigning Beijing’s skyline like probably nobody in Chinese history has ever done. When you are in one of Beijing’s business districts, it is impossible not to have the company’s logo «SOHO» in sight, they have built everywhere and are unable to recall exactly how many buildings they actually brought to existence in China’s capital, as well as in Shanghai.
The adventure is going on, in march, the SOHO group announced the 2012 results, with a turnover rise of 170% compared with the previous year, while Zhang Xin stated that the group was still in a development phase with heavy investments and that «it is only the beginning».
If you are in Beijing right now, go and have a look on the latest of their gigantic projects under construction in the Wangjing district, part of the « Large Wangjing» urbanisation plan. This new project is designed by the architect Zaha Hadid, like the Galaxy SOHO you can see now in Chaoyang. This Wangjing project is a stylization of three mountains with elegant curves, they are huge, and will be beautiful, because the signature of the SOHO brand, which makes it distinctive of the most usual construction in continental China is that style is a strong feature.
Communication with the public
Zhang Xin and Pan Shyi’s visibility does not limit itself to spectacular urbanisation, they are active on China’s social networks, they have built a strong personal image among contemporary China personalities. They both have accounts on the Sina Weibo micro blogging platform. Both Zhang Xinand Pan Shiyi have millions of followers on these Weibo accounts and and they are personally active writing articles. Even more surprising, considering they are business personalities in the contemporary Chinese business world, Zhang Xin claims political opinions, her vision of Chinese society and, like her husband, she is a member of the Baha’i religious group and she even made a cameo appearance in a Hollywood production, «Wall Street, Money never sleeps».
An epic tale that illustrates China’s economic rise
All of these achievements are fascinating in themselves, but what is even more amazing is to know the way everything happened from the very beginning. Zhang Xin explains in fascinating interviews her story and how she is a living symbol of China’s history during the 40 last years. She was born during the cultural revolution, and sent with her parents to work in the countryside since they were university graduates. Later, the family could move, first to Beijing then quickly to Hong Kong where Zhang Xin, age 15, worked in sweat shops. At the age of 19, she has enough money for a one way ticket to Great Britain. When she arrived, she still has language issues and has to work in a small food staple and managed quicky to enter Sussex University then Cambridge. Graduated she begins to work in investment banking, recruited by Goldman Sachs then by Travelers Group, a world she does not really appreciate, judging it too ruthless with crassy speaking.
Everything switches during a business trip in 1994. She has to go to China for investment reasons and discovers a country where everything is changing. She sees all the new factories that remind her of her youth and wonder, seen the pace of change, where all these sweat shops workers will be in 10 years of time. At the same time, she met with her husband, a young daring construction corporate who explains her the kind of job he is doing. He tells her he is currently building the Chinese Manhattan. At first, she laughs since he has never left China and has probably realized that what Chinese people are building is much bigger than Manhattan. She decides to join the adventure, and 5 days later they have decided to get married and they establish the SOHO group.
Design, architecture and urbanism
Zhang Xin influence will be decisive in the success of SOHO China, she is complementary and an advisor to her husband. While he is very at ease in the commercial world and know how to sell a project to the CHinese businessmen and authorities, she dedides to raise the standards, understands how architecture and style are important, and even more important, she understands the functionning of the western world and knows how to attarct foreign investors. The couple who started with almost nothing builds a real estatte empire within a few years, and have two sons, on a family side.
The large projects rise all over Beijing and Shanghai, with emblematic locations such as SOHO Sanlitun, the Sanlitun village designed by Kengo Kuma, the Galaxy SOHO in Chaoyang, the Shanghai SOHO… The list is far from comprehensive, but reflects an evolution as well. Design is more and more important and the group that used to build to sell, has decided, in 2012, to build to hold. Now, the SOHO buildings are SOHO managed and they are specializing in office real estate.
The choice appears wise, since the office vacancy rate in Beijing is around 3% and 5% in Shanghai. There is still a strong demand of office space in China’s Tier I cities, with CHinese and internatinal companies still settling themselves in these cities. The group might consider other cities than Shanghai and Beijing when they decide these cities have reached maturity. The group’s investment try to remain as secure as possible, avoid residential real estate where the existence if a bubble is uncertain, and avoid even more retail real estate, where there is oversupply in China’s city when customers are turning to online shopping.
Beginning of a new era for SOHO ?
In 2013 there was another big switch of the group’s policy. Leading a group of Chinese investors, SOHO China has bought 40% of the General Motors building in MAnhattan, the largest real estate acquisition that has ever occurred within the United States. IS it the symbol of the change of an era ? SOHO contributed to build the Chinese Manhattan, they are now building the original one. Is it a sign of nervosity because of China’s uncertain future ? That does not fit with the optimism shown by Zhang Xin.
One thing is sure, looking at what happens next will be interesting, since the SOHO Saga seems far to be over.
