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DevWest started as a residential real estate developer in Perth and is now one of Perth’s most diversified developers, with an established presence in China and a major player in attracting Chinese real estate investment into multi-level retail, mixed use and residential development projects in Perth. A significant proportion of the equity that DevWest sources for its development projects now comes from China.
After an initial introduction from an Australian contact based in Beijing, DevWest’s Directors took less than five years to build a reputation with Chinese investors. At this time DevWest had a track record with local and Singaporean investors, but not with investors from China. The DevWest directors initially relied on introductions in Beijing, however after a focused and sustained effort, which included trips to many different cities and plenty of pavement pounding, their network began to grow. Notwithstanding their efforts, they did not gain real momentum until they had delivered several successful projects for Chinese investors. Initial trust needed to be followed by successful delivery.
The DevWest directors have built active client networks through personal contact with visiting delegations of investors, frequent presentations by its directors in China, meetings with migration agents, liaising with Chinese banks and their private clients as well as introductions to family and friends of existing investors.
DevWest’s has investors from second and third tier cities in Zhejiang Province such as Wenzhou, Ningbo and the provincial capital Hangzhou as well as from Shanghai and cities in the North including Beijing and Taiyuan. Because of the wide regional spread, DevWest decided against setting up a permanent office in China, but hired a Chinese staff member and set up a Chinese language web presence.
DevWest is confident that its network based business model will serve it well as competition from Sydney and Melbourne increases. Chinese competitors are also expanding their reach into Western Australia, but are currently hindered by lack of familiarity with local practices.
DevWest demonstrates that small Australian businesses can break into markets that are difficult to enter. DevWest’s success shows that relationship building continues to be the most significant investment to attract Chinese clients.
Firms are also being drawn into China engagement when they have to respond to competitors who gain advantages over them through China exposure. Partnering with Chinese businesses then becomes an important business strategy. An overwhelming majority of our survey respondents from all business sectors and industries indicated that they would benefit from partnering, including joint ventures with Chinese businesses. Three quarters of respondents partner with Chinese private firms. The one quarter of Australian firms partnering with Chinese state-owned enterprises are larger in size than the average respondents and are predominantly targeting Chinese industries where the state sector has remained strong.