u201cThe pace of change will accelerate in the coming years,u201d said Byrne<@SM>u201cThere are numerous reasons why Asian investors find the US attractive,u201d said Qiu.

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SAN FRANCISCO—Last week, CORFAC International firms from all over North America, Europe and Asia gathered in San Francisco for the network’s spring conference where they celebrated CORFAC’s 25th anniversary and conducted business between participating firms and the 120 or so attendees.

One of the conference highlights included a technology panel that was organized by Tom Martindale, SIOR, who is president of the host-firm TRI Commercial/CORFAC International and also serves on CORFAC’s Executive Committee.

The panel was moderated by Tom Byrne, former president and COO at LoopNet from 2002 until its sale to CoStar in 2013. Now a venture capitalist, Byrne’s opening comments reminded the audience that the commercial real estate industry is the second-largest asset class in the US, worth $12 trillion (bonds are No. 1) and with technology evolving so rapidly, “the pace of change will accelerate in the coming years.” For example, by 2018, the number of people connecting to the Internet from mobile devices will increase 25 times, Byrne said.

Byrne also cited the behavioral trends that are driving change; among them: workforce mobility, crowd-sourcing, more people owning their own devices (rather than supplied by their employers) and energy conservation. The panelists were technology specialists (all CEOs) Dave Harris (Real CoreApps), Alex Markson (Property Capsule), Tanner McGraw (Apto), Nick Romito (View the Space) and Michael Mandel (CompStak). Each discussed features of their respective technologies, price points and user bases, with Nick Romito summing up the panel’s perspective when he told the attendees: “The risk to people in the CRE business is to not use the technology that is available now.”

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One of the better attended conference sessions focused on Asian investment trends in the US and the presenters were San Francisco-based Anton Qiu, a TRI Commercial/CORFAC International Principal and Vice Chairman of the San Francisco-Shanghai Sister City Committee, and Tony Letvinchuk, Managing Director with Macdonald Commercial/CORFAC International, based in Vancouver, B.C.

Qiu is heavily involved in representing Chinese investors in the U.S. and is a frequent guest lecturer at universities and industry conferences. He reeled off some telling statistics:

  • 2013 was the first year that China’s GDP exceeded $4 trillion (4.13)
  • China’s GDP is expected to surpass the U.S. within 10 years
  • China is the largest net-export country in the world
  • Chinese investment in U.S. commercial real estate in 2013 was $3.1 billion, or five times greater than the previous year (CRE investment in 2012 was $200 million)
  • 30% of Chinese investment outside of Asia is in real estate
  • China has a very small percentage of high net worth families ($1.5 million in U.S. dollars) but it is growing by 15-20% annually and with 1.6 billion people, within a few years there will be even more investment money available

“There are numerous reasons why Asian investors find the US attractive,” said Qiu. “The US dollar is cheap compared to China. A Class “A,” $700-per-square-foot shopping center here would cost $1500 a foot in Shanghai. Plus, in many cases Chinese are investing and effectively buying a green card, or they want to be here for their children and higher education. Then there are safety and wealth preservation issues and even lifestyle – Beijing is notorious for its air pollution and for people with means, they can leave,” said Qiu.

Letvinchuk’s commented on Asian investment in British Columbia’s West Coast port city of Vancouver was equally impressive, yet when speaking to an audience comprised entirely of commission-based real estate professionals, the biggest take-away for conference goers occurred when he put up a photo of one of his real estate agents and said: “Cynthia Dong is the No. 3 broker in Vancouver and has done over $100 million in sales for two consecutive years, mostly to Asian buyers.”