Mei Huang had been in Myrtle Beach less than 24 hours before her tour of a 3,000-square-foot home in Carolina Forest and already she had made up her mind about the Grand Strand.
“It’s so beautiful!” she said enthusiastically.
Huang, who exports U.S.-made nutritional supplements to China, represents one side of what some hope is a nascent investment surge in the area by Chinese that includes potential homebuyers, investment moguls and tourists.
Already, they have bought second homes, a near-dormant shopping center that once was a must-see shopping mecca for tourists, 13 golf courses and an entire section of Grande Dunes that will eventually have 50 homes built on it.
The Chinese are one-at-a-time kind of buyers, say those who have dealt with the investors and home buyers along the Grand Strand. They’ll look and if they like, they’ll buy quickly. But then they tend to step back, assess what they’ve done and if it’s good, move on to the next buy in the area and/or introduce acquaintances to the good deals they got.
Attracting the investors/buyers is kind of like building a savings account. Each deposit may not seem like that much – although some will be significant – but as you look back after several years, you could see real progress.
Between 2000 and 2014, according to the Rhodium Group, which tracks Chinese investment in the United States, the Chinese put $418 million into South Carolina, the third highest total in the Southeast.
Over the same time, they bought real estate and hospitality properties worth $31 million, the second highest total in the Southeast and ninth highest in the United States.
Virginia, which leads the list nationally with $8.9 billion in Chinese investment, according to Rhodium, and North Carolina, which ranks fourth in the United States with $4.5 billion, are the two that outrank South Carolina in the region.
But the investment in South Carolina is spread over more segments of the economy than in Virginia, where the Chinese have spent $7.1 billion in agriculture and food investments, or North Carolina, which saw a $4.2 billion investment in information and communication technology.
Besides those in real estate and hospitality, Chinese investments in South Carolina include $196 million in consumer products and services, $137 million in basic materials and $40 million in industrial and electronic equipment, according to Rhodium.
Huang, like Wei Min Wang whose 3W investment company purchased the former Waccamaw Pottery, represents the United States end of an investment group whose partners are in China. Huang’s husband imports the supplements into Beijing, where he lives, and Wang’s brother and investment partner lives in Changzhou, which is in the Yangtze River delta.
The two, like the buyer of the majority of the golf courses, were all brought to the Grand Strand by Myrtle Beach Realtor Jane Zheng, herself a native of mainland China.
Zheng said there is a pattern, almost a cadence to the way Chinese invest in the United States. They come to look at property and if they like it, they buy. Then they see how their initial investment works out. If it’s positive, they’ll spend more.
Huang, for instance, was back within a week with her brother and a friend from mainland China. Huang and her brother bought a home in Carolina Forest while they were here, and the third person had to check with someone back home before putting down the cash.
The same kind of pattern is playing out with Yiqian Funding, the Chinese group that so far has bought eight Grand Strand golf courses.
They will return again in April when the main investor from China will get married.
He’s bringing 60 golfers with him who Nick Dou, the group’s U.S.-based partner, said will be looking for homes to buy, among other things.
At the same time, according to Myrtle Beach Mayor John Rhodes, Yiqian Funding is being shown other properties along the Grand Strand and asking him how high they might be able to build a hotel.
“What they do,” Rhodes said, “they test the waters and get involved. If it goes well, they do something else.’
It doesn’t all happen with the speed of Huang’s home buy or the purchase of the golf courses last year.
Wang said he doesn’t know if 3W will be investing more in the Grand Strand. The Waccamaw deal, which happened in 2012, was the first big buy in the area by Chinese investors.
Wang said recently that the group feels it is on track with the Pottery’s transformation, though.
Zheng said most of the more than 100 homes she’s sold to Chinese so far will eventually be where the buyers will retire.
Huang said that in perhaps a couple of years, her husband will move from Beijing and the two will enjoy their golden years along the Grand Strand.
The growing number of Chinese home buyers, particularly those coming for the wedding, has sparked talk of the new residents funding a school for their children’s education.
Additionally, said Brad Dean, CEO of the Myrtle Beach Area Chamber of Commerce, some national hotel chains have already done things to accommodate Chinese tourists, and some local resort owners are talking about similar measures.
Dean said some national chains have slippers in rooms for Chinese travelers – which are standard in Chinese hotels – menus translated into Mandarin, Chinese satellite television and limited Chinese menus, especially breakfast.
“The Dou wedding party is very significant for our market,” Dean said. Both the golf course owners and local business interests hope the initial trip is the first step in attracting more tourists from mainland China.
“They could go anywhere in the world,” Dean said of the wedding party, “but they are choosing to come to the Myrtle Beach area.”
China, too, has recognized efforts in South Carolina to attract Chinese investment.
Xinhua, the Chinese state-owned news agency, published an article recently in its online English language edition about Chinese investors traveling to a U.S.-sponsored seminar in Washington, D.C. South Carolina was mentioned six or seven times in that story and a sidebar because of some large manufacturing investments by Chinese in the state and the efforts of South Carolina’s office in Shanghai.
No other state had more than one mention in either article.
Chinese golf course buys along the Grand Strand total $47 million so far, which is impressive to Grand Strand eyes but small potatoes when compared with some Chinese manufacturing outlays in the state and other Chinese investments in the U.S.
Cassie Gao of the Rhodium Group, said the total paid for the golf courses are the second smallest sector for Chinese investment in the U.S., ahead of vineyards.
Likewise, Dean said China is one of the chamber’s overseas growth targets, and while the growth has been impressive in the past few years, it “is still a tiny portion of the local tourism economy.”
Rhodes said partners in Yiqian Funding have told him they have $200 million to invest along the Grand Strand this year.
It’s a clear indicator company partners feel their initial step into the area was a good investment and that they’re ready to put another foot forward.
It’s the cadence of one investment, pause, then another.
“So far,” Rhodes said, “it’s worked for us.”
Chinese spending on the Grand Strand
13 golf courses (since June 2013, with registered sales prices)
▪ International World Tour Golf Links | $10 million
▪ Sea Trail Resort’s Maples, Jones and Byrd courses | $8.5 million
▪ TPC Myrtle Beach | $7.3 million
▪ Indian Wells Golf Club | $4.75 million
▪ Burning Ridge Golf Club | $3.75 million
▪ Aberdeen Country Club | $3.3 million
▪ River Hills Golf Country Club | $2.45 million
▪ Founders Club at Pawleys Island | $2.2 million
▪ Crown Park Golf Club | $1.5 million
▪ Black Bear Golf Club | $1.5 million
▪ Colonial Charters Golf Club | $1.3 million
Commercial
▪ Waccamaw Pottery | $7.5 million
▪ An undeveloped section of Grande Dunes | $5 million
Housing
▪ More than 100 single-family homes
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