CCIM Feature

CCIM Spotlight: Moving East

A CCIM shares his development expertise in China.

By Stephanie Bell |

"Ienjoy traveling and exploring. I also really like commercial real estate. Combining the two seemed like a natural path for my future,” says Bruce A. Haulley, CCIM, located in Shanghai, China. Semi-retired, Haulley has lived in Shanghai since April 2007 and currently volunteers for the Pacific Rim Institute for Development and Education, a non-governmental agency. Serving as the development director, Haulley is helping the organization to plan and build a modern school in Laixi, a rural city in northern China.

Jumping into his development duties, Haulley traveled to Laixi twice, met with government officials, walked the land, checked the area and its development, and wrote a prospectus. “The process of gathering information in China is very different from America,” he says. For instance, there are very few outside sources for objective information, and in this particular rural area, there were none. Using a little creativity and many years of commercial real estate experience, Haulley was able to pull together his own sources. “I paid for an interpreter and visited other development sites to interview the people in charge,” he says.

“The demand for modern, progressive educational facilities in China can scarcely be exaggerated,” Haulley adds. When he and his partners pitched the school project to Laixi’s city government, local city officials were receptive. The rural community is determined to enter the global economic mainstream by starting a school with international academic standards and a modern curriculum. This is a very good business growth plan for the city, Haulley says.

But the project is not without its challenges. “Real estate development anywhere is an inherently hazardous process … and in China it’s beyond difficult,” Haulley says. The city originally had suggested a discount on the land purchase as an incentive, he explains. PRIDE was able to raise the money; however, the Chinese market has continued to appreciate, causing city administrators raise the land’s price. “The latest proposal from the city is to sell the land to PRIDE at full market [value] and return the extra money beyond the original agreement when the school is built and operating,” Haulley says. Doing this would change the development’s financial dynamics and currently the details are still being negotiated.

“Once the situation is settled, we hope to begin preliminary architectural work based on our business plan of three buildings in two years and having a population of 200 students,” Haulley says. Once the project is started, PRIDE will seek additional investors.

In the future, Haulley hopes to use his commercial real estate expertise as a consultant, “potentially working for both Chinese companies wanting to partner with international investors and multinational companies considering investing in China,” he says. He also sees investment potential in some of China’s second-tier cities and generally feels that the country’s overall economy will continue to grow.

“I see massive opportunity for the next decade of China’s population gaining education, access to world business markets as workers and as consumers, and their demand for better real estate, both residential and commercial,” he says. “If anything, the second wave of growth in China will be greater than the first.”