Housing Complex

D.C.’s New Chinatown: Shanghai?

If the best way to get customers is to be right next to them, D.C.'s going straight to the source: China, where it's setting up a business office to help advertise District companies and channel dollars back home. Previous mayors have made goodwill trips abroad, but this would mark the first time D.C.'s established a real presence in a country that's poised to invest, city officials say.

The yet-to-be-named center, which Deputy Mayor for Planning and Economic Development Victor Hoskins set up on his swing through China a few weeks ago, is similar to ones maintained by Maryland and Pennsylvania. In fact, Hoskins recruited the same guy who runs them, Ning Shao—a former managing director at Weber Shandwick who worked for Hoskins in Maryland—to start the District's own version in Shanghai. He'll be paid on a contract that's still being hammered out.

A quick survey of Shao's accomplishments shows a few bright spots: Big contracts for architects and manufacturers, and smaller wins here and there. The District doesn't really manufacture anything, so the city would want Shao to market its intellectual capital, like design and tech services (to a lesser extent, similar efforts are underway for Brazil and South Africa through the Export D.C. program). He might also do a bit of tourism promotion with Destination D.C.

A big part of the job, though, would be wooing wealthy people who want a safe spot for their money. The District has an advantage in that regard: Being in the President's backyard carries a certain amount of cache. Right now, a lot of that cash is coming through the EB5 program, which allows foreigners to essentially buy a green card in exchange for investing $1 million in a new business enterprise. Shao brought in some dollars for an Anne Arundel County casino that way. In the District, O Street Market and the Marriott Marquis hotel got $5 million in EB5 money each.

But we want more, as I explained after the Qatari investment in CityCenterDC. The question is: How would neighborhoods feel about the Chinese owning chunks of projects right next door? Or more importantly, if we're talking about St. Elizabeths east campus, how would the Department of Homeland Security feel about them owning part of a big piece of real estate across the street? The feds can be unpredictable on this kind of thing, and it would stink to have them derail a deal at the last minute on account of D.C.'s entrepreneurial fundraising.

The other question is one of divided loyalties. Shao would be the obvious pick for the job, given his familiarity with the area, and previous relationship with Hoskins. He's still working for both Maryland and Pennsylvania, though. D.C. might have different offerings—a streetcar instead of a casino, for instance—but Hoskins himself has said that he uses his knowledge of how Maryland does business in order to compete on the District's behalf. Will Shao be able to do the same?

The initiative rolls out on April 10th with an event at George Washington University, which has been a big partner for the District in all this China stuff. Expect to see a mayoral visit to China soon after.

  • http://urbanplacesandspaces.blogspot.com Richard Layman

    I guess it's about going directly to the source of capital, rather than getting it secondarily. If the US economy tanks, if China is directly involved in financing various projects in places like DC, then they won't foreclose.

    Interestingly, the money behind Gov. Cuomo's proposal to move the Javits Convention Center in association with a new casino in Queens is Chinese.

  • Smart

    I've been asking DC Council members for 15 years why we don't model our economic development after the programs that our neighborhing Counties have. Fairfax, Loudoun, Montgomery County etc all have staffed offices in Europe, Asia, Central and South America to entice foreign companies to open offices in their counties, and they have been enormously succesful.

    It is about time we followed suit.

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