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Good development shop with a few exciting projects. People there are genuinely good people. However, my understanding is that it's Chinese Capital, any investment memo you put together will not be presented by you, but probably your superior in Chinese to those that actually make the decision. If you speak Chinese that is a plus. Also if it is an acquisitions role make sure you are proficient in excel.
Thanks for the response. Do you know anyone currently working there or is this through third parties? If investment decisions are not independent of the Chinese parent company then the role might not be as interesting...obtaining financing might get complicated as well. If you have more information about them I'd like to PM you about it.
I know someone that interviewed there. I would like to help more, but I pretty much told you everything I know, other than salary which will probably be low-mid six figures all-in depending on your experience and role. They stress the importance of quick financial modeling and when my friend interviewed there he asked about whether utilizing Chinese money would be a long-term issue and they brushed it off claiming it did not effect them (I forgot the reason why).
I would be very, very cautious about working for a Chinese developer right now. The Chinese government is trying to repatriate A LOT of capital that was slated to be deployed in many gateway US markets...other Chinese developers have been pumping the brakes hard in recent months with respect to new development activity/capital investment.
Ricky, thanks for pointing that out. I was somewhat aware of the capital repatriation issue, but hadn't thought of it here.
Gemdale has their cash outside of U.S. entities in China.
Gaw capital on the other hand is active in CA from what I know. I believe they have a lot of money parked in the U.S. already
Look no further and DTLA right now for reasons to back off Chinese backed capital partners. $100M in mechanic liens at the moment and despite some articles saying construction has restarted I was there last week and the site looked like a ghost town. Complete eye soar for an otherwise booming Southpark neighborhood.
https://www.latimes.com/business/la-fi-oceanwide-plaza-stalled-20190125…
Agreed with Ricky Rosay. I've seen a few LPs chinese investment funds simply vanish with $500MM AUMs invested in the US. Also significant EB5 slowdown from China both from a backlog of investors waiting for their temporary green cards and China govt making it almost impossible to move money outside of the country.
Guys everyone is focused on the capital issue which I agree is the big one but I just want to throw out one other thing I've seen in my experience. I looked at many construction projects from chinese developers and uh let's just say the u/w was questionable at best in a majority of cases. Can't speak to Gemdale specifically, but an overarching theme I saw. I'm talking solving to 15% margins on condo projects. Cmon.
That's because the only goal is to park their money somewhere outside of China.
I don’t know much about condo projects but I remember being told by one of the old timers a few years ago that historically, they’d shoot for a 20% margin but it’s hard to achieve nowadays. Now a 15% margin isn’t realistic?
I would aim for 25-30% on condos. 20% on any other commercial property type.
At that rate, does the deal even need to be profitable? Only half joking.
To continue your half-joke, probably only half as profitable as any other investor would want it to be.
Gemdale plays more like a local developer/investor, versus other Chinese companies that have businesses in the US, the other example is Vanke. Two levels of investment committees (the US one and the headquarter one). Obviously, it would be better if you can speak Chinese, as the final committee mush be board members in China.
This is a legit company. My father is a BOD of Gemdale parent company in China. The Gemdale U.S. which was created as a subsidiary runs very different from the Gemdale parent. The company is the 7th biggest real estate company in China. Don't worry about speaking Chinese, most guys in the U.S. subsidiary are fluent in English. The subsidiary is just part of the company strategy to diversify it's business outside of China. Most comments here doesn't represent the reality of the real estate business, but rather a narrow view from what you hear on the news. Gaw capital and Gemdale runs very differently. The Gaw family who's a family friend runs Gaw capital more as a family office. In comparison, Gemdale is a public company with many successful track record in China. If you're looking for a more traditional RE PE firm, then Gemdale won't fit that category. It functions more as a corporate development in a real estate firm. Therefore, it's not actively just looking for a one time large return but rather figuring out how to generate a sustainable return in the long term. Think of it as CBRE, Tishman Speyer, and Cushman Wakefield 's AM / internal M&A arm.
Bill,
How independent is Gemdale China and Gemdale USA? Sounds like the parent company still has final approval on investments, so I'm guessing it also provides a large percentage of capital to the USA fund...or does Gemdale USA raise and manage its own independent series of funds from other capital sources?
Let me know if you'd rather discuss this privately - thanks.
To be frankly honest, I don't know. I'm not involved with Gemdale in any level. However, I believe most capital are from the parent. It's very different from real estate funds. Think of a F500 company, they made money from a core business and now they are expanding by acquiring other business. In this case, Gemdale made money from the real estate development business in China (i.e. building and selling properties). They accumulated a certain level of asset and now looking to expand it's footprint globally into the U.S. They tap into capital market for access to capital (like every other F500 companies), maybe a portion of it's capital from private placement or large institutional investor? In the end, I believe majority of capital will be from DCM given it's relatively low cost. FYI, Gemdale is a ~$58Bn market cap company. If you're looking for a more corp development experience, then this will be more closer align with the internal M&A team at a large real estate firm. If you're looking for a private equity experience, then you're better off looking somewhere else.
Just to shed some light on Gemdale versus the Vanke / Wanda, It's very different. Vanke and Gemdale work on very different deal size. I don't know the actual range, but I know they rarely compete in the same league table / market. There's more and more competition among the two given that the potential RE development in China has considerably declined. In the other hand, companies such as Wanda and Evergrande operates more like a Blackstone, where they own a large amount of real estate in their portfolio but, have diversify into other non-core business such as entertainment, media and etc.
Unless you're Chinese and or intimately familiar with Chinese culture(yes I'm talking about bananas), stay away from Chinese firms. The rules and culture are just completely different not to mention all the issues noted above in this thread.
Does anyone have insights to pay at Gemdale/Chinese RE firms in the US?
I'd think they have to overpay to attract talents, who would be less inclined to join firms with Chinese capital source?
How are capital typically structured? Are they committed capital and have legal docs or is it all based on a deal-by-deal basis?
What are Chinese investors expectation of yields? Higher/lower than US-based investors? Trying to understand how easy it is to win deals with different investor yield expectation.
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