Betting on the Chinese
Updated: 2016-09-16 23:03
By Amy He(China Daily USA)
Developers of the Sky Las Vegas, a luxury condominium next to the Lucky Dragon, are bullish about marketing and selling 64 of the remaining units in the property to Chinese buyers. Provided to China Daily
Goldsmith said that Lucky Dragon’s main purpose — servicing Asian clientele and specifically Chinese — is unique in Las Vegas, and its boutique size allows them to go after a specific market segment with more dedicated resources.
“I think they’re going to be an example for a lot of properties that say, ‘Wow, this is how they’re doing it, and this is what we need in order to be successful,’” Goldsmith said.
The Lucky Dragon will face competition for Asian tourists from the Resorts World of Las Vegas, which will begin construction at the end of this year and is scheduled to open in 2019.
With an estimated budget of $4 billion, the Asian-themed Resorts World will have more than 3,000 hotel rooms in multiple towers, convention space, movie theatres, a 150,000-square-foot casino and a 30,000-square-foot lake as part of a Chinese garden spanning the grounds.
It is being developed by the Malaysia-based Genting Group, which operates a Resorts World there and also has resorts in the Philippines, Singapore, the UK and New York.
Lucky Dragon’s developer is a privately held entity known as the Las Vegas Economic Impact Regional Center. It was built with EB-5 funds, an investment program that grants permanent US residency visas to those who create at least 10 full-time jobs and invests between $500,000 to $1 million.
Though EB-5 investors in city projects come from Europe, the Middle East and Asia, the vast majority of the funds are from Chinese sources, said Jacoby, who is also the COO of the Las Vegas Economic Impact Regional Center (LVEIRC), which helps support EB-5 fundraising for other projects in Las Vegas, such as the Downtown Grand Hotel and Casino.
Jacoby said that while Las Vegas’ casinos realize the importance of Asian guests, they don’t make up their core business or cater to them.
“All of the casinos here on the strip are largely built by Americans for white Americans, frankly, with some that have small sub-sections for Asian players. Some may have a separate Baccarat room; some may have a Chinese restaurant. One or two places even have two. But that’s about it,” he said.
“The majority of these places are built for Blackjack and slot playing, Americans who want to go to the pub or go to a nightclub, which isn’t traditionally what Asian guests like to do when they’re here.’’
Jacoby said Lucky Dragon isn’t going after “the top, top tier guy flying in by private jet from Beijing or Shanghai who is probably going to the Wynn or the Venetian (casinos), or two or three other places in town’’.
“If you’re the 1 percent, private- jet type of customer, you’ll get the authentic experience that other players don’t get because you qualify for it and you’re paying for it. So at Lucky Dragon, we take the cultural touches of the top 1 percent — language, food, general service standards — and provide that to them as a base product of what’s in our DNA for everyone, and kind of cater to the rest of the 99 percent in the way they’re being ignored,” he said.
In addition to putting money into the EB-5 visa program for projects in Las Vegas, Chinese also are investing more heavily in other Las Vegas real estate, including second homes and homes for their children studying in Nevada.
Betty Chan, a Las Vegas Realtor who works with Chinese families, said her clients often are attracted to the low home prices in the city. “They see that the prices here are so good and the rental incomes they can get are so much better than what they can get in China, so they invest,” she said.
She sells houses that range from $200,000 to $300,000, and many are two-story properties in high-end communities that she said the Chinese favor.
Chan said she recently worked with a Chinese family that owns a hotel chain in China, who needed a house for their son who is going to a hotel management school in Las Vegas.
Randy Char is the president and owner of Char Luxury Real Estate, a luxury boutique brokerage that specializes in high-end luxury clients. He is selling 64 units in the new Sky Las Vegas, a 45-story luxury condominium on Las Vegas Boulevard between the Lucky Dragon and the upcoming Resorts World.
The units go for $300 a square foot, an attractive price for investors compared to similar properties in New York that may fetch nearly $3,000 per square foot, $1,500 in San Francisco, or $1,000 to $2,000 in Hawaii, according to Char.
Sky Las Vegas represents a chance for the Chinese to buy a piece of Las Vegas Boulevard, where few properties are available for purchase, said Char.
“The one thing I do know about the Chinese is that they’re very smart investors. They do a tremendous amount of research,” he added. “They are savvy, they go on the internet, they look at the macroeconomic factors. The misnomer that they’ll just buy anything is just not true.”
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