Goodwin Gaw, The Standard owner, and his business dealings in Shanghai, Hong Kong, Guangzhou and Beijing
Bonus info on Morgan Stanley and Goldman Sachs.
https://www.institutionalinvestor.com/article/b150ns65yt5jtm/shanghai-fixer-upper
In addition to the Shanghai property, Gaw's Gateway Capital has bought stakes in residential developments in Beijing and Guangzhou. His investors include such high-profile players as New York hedge fund Angelo, Gordon & Co., Wachovia Bank and high-net-worth families in Asia and Europe.
Gaw traces his family roots to the coastal southern Chinese province of Fujian. His father, Anthony, was born in what was then Burma; his mother, Rossana, is from precommunist Shanghai. Goodwin Gaw was born in 1968 in San Francisco while his father was in graduate school at Stanford University studying engineering. In the 1970s the family moved back to Hong Kong, where Anthony founded Pioneer Global Group, a holding company with interests in food products and real estate.
After earning a civil engineering degree from the University of Pennsylvania in 1986 and a master's in construction management from Stanford in 1993, Gaw joined Los Angeles real estate investment outfit Kennedy Wilson, where he helped troubled Japanese firms sell U.S. commercial real estate.
In 1995, Gaw set off on his own, putting together a consortium to buy the Roosevelt Hotel in Hollywood. A onetime haunt of movie stars such as Clark Gable and Carole Lombard and site of the first Academy Awards ceremony in 1929, the 335-room hotel had long since lost its glamor.
Gaw asked his father (who died in 1999) to chip in. The elder Gaw gave him $1 million, along with a few words of advice. "My father said to me, 'You're too young. But if you really believe in it, find someone else who believes in you.'"
The young entrepreneur did, pulling in contributions from friends and family. Then he and his partners paid $10 million for the hotel and spent another $20 million renovating it. Now a trendy destination, the property is estimated to be worth upwards of $100 million.
Through Downtown Properties Holdings, his Los Angeles company, Gaw controls a half dozen other pieces of real estate – typically, once-crumbling structures that he has restored. A prime example is the 113-year-old Bradbury Building, a landmark property that is the oldest commercial building in central Los Angeles and was featured in the Ridley Scott 1982 film Blade Runner. Gaw bought the building for $6 million in 2003; following an extensive renovation, it is now valued at about $9 million.
"My father liked passive investments," he says. "I like to get my hands dirty."
Gaw became interested in Asian real estate after the region's 1997 economic crisis depressed property values. Acting for Pioneer Global, the family firm of which Goodwin is vice chairman, he purchased a 10 percent stake in Dusit Thani, a leading Thai hotel operator, in 2002. He also acquired industrial properties in Singapore for the group.
At Gateway Capital, Gaw and his brother, Kenneth, formerly an investment banker with Goldman Sachs in New York and Hong Kong, are based in Hong Kong; Humberg Pang, a former executive with London-based real estate consulting firm Savills, runs the firm's Shanghai office.
The team focuses on transactions valued at $20 million and up. In today's frenzied market they put a premium on moving quickly to close deals. "We're nimble," Gaw says. "That's especially important in China."
Gateway also seeks to leverage its ethnicity. Gaw believes that authorities in China are skittish about foreign ownership of prime developments. "We're from Hong Kong, and we're Chinese," he explains. That cultural edge helped Gateway navigate the Chinese bureaucracy and obtain the approvals needed to buy the Shanghai property from a group of ten businessmen.
Gaw contends there is a gap between perception and reality of the Chinese market. "Right now a lot of funds are kicking the tires, but there aren't a lot of deals yet," he says. He is clearly betting on an increase in transactions to achieve his targets, though. Over the next seven years, Gateway aims to deliver at least a 20 percent average annual return to investors.
What about political risk? Gaw notes that Beijing authorities occasionally impose edicts such as mortgage restrictions to control bank lending and land values, but he is confident he can withstand any turbulence by taking a long view.
"We don't expect to be highly leveraged," he says. "When property prices go up too quickly, the government interferes. We take a long-term view that takes into account the government cracking down now and then."