The power of privilege

PUBLISHED : Saturday, 17 November, 2007, 12:00am
UPDATED : Saturday, 17 November, 2007, 12:00am

Sales executive Li Ye seemed smitten as she spoke of the dashing VIP who earned US$500,000 for a three-hour visit last week to the luxury villa development she is marketing. 'He was very handsome and very charming,' she said with a giggle. 'The ladies all adored him and you could see that the men admired him, too.'

It wasn't just his looks and charisma but his professionalism that impressed Ms Li. 'He was much better value than Bill Clinton,' she said, referring to the former US president who was paid a reported US$200,000 for speaking at a property launch in Shenzhen in 2002. 'Mr Clinton only delivered a speech at a hotel when he came, but Mr Blair came to our villa and even hosted a party. What he has done will make this the No1 development in China.'

Tony Blair, the former British prime minister, was ridiculed in the mainland press last week for his money-making stop in Dongguan between speaking engagements in Hong Kong and Beijing to endorse the ostentatiously named The World Is Mine lakeside villa complex, where homes are expected to sell for upwards of US$5 million each.

A commentator in the China Youth Daily compared Mr Blair's brief speech - in which he lavished praise on Dongguan and told his audience how his seven-year-old son was learning Putonghua at school - to the ramblings of a county official, asking: 'Why pay such a price to hear this? Is it worth the money? Do these thoughts multiply in value because they come from the mouth of a retired prime minister?'

Whatever the newspapers made of it, the answer from the man who paid Mr Blair's fee - property tycoon and head of the Guangda Group Chen Runguang - is yes. And next week, when the price is released for the first batch of 132 villas to go on sale, the return will become more quantifiable on the investment in the backing of Mr Blair, now a Middle East envoy for the UN and the big western powers.

As with Mr Clinton's visit five years ago, it isn't the content of the speech or the length of the visit that counts. It's the potent sales power that a visit by a former world leader can yield in a luxury market where the snob value of being able to drop a famous name into an address can be worth millions of US dollars. The Guangda Group expects 'Brand Blair' to push up the prices of its villas by multiples of his fee.

According to one mainland newspaper report, Mr Chen recouped his outlay before Mr Blair's visit was over, persuading 100 potential buyers to put down deposits of more than US$100,000 each for the privilege of a table near Mr Blair at a reception in the Hyatt Regency Hotel near the development.

Within hours of Mr Blair's departure from Shenzhen airport on a private jet, the serious marketing began, with the Dongguan development all but re-christened 'Blair Villas'. Banners boasting of his association with the project have been draped from lampposts en route to the site and a three-metre-wide electronic billboard flashing images of his visit has appeared outside the sales office.

Inside the office, a slide show of Mr Blair hosting an hour-long party for VIP guests at one of the villas is on a continuous loop, and potential buyers are enticed with whispered promises the former British prime minister didn't just visit, but may take up residence in the complex.

'Mr Blair has been offered a free villa in the complex,' Ms Li said. 'We don't know which one it will be, but it may be the show home where he hosted the party. For us, he would be the perfect tenant and very good for business.'

Conveniently, the offer of the villa has not been formally made to Mr Blair. When it is, he will almost certainly politely decline. But in the meantime, sales staff can tell prospective buyers in all honesty that if they slap down a deposit, they might just find themselves living next door to the Blairs.

Whether the ostentatious four-bedroom villas, with their giant chandeliers, jacuzzi baths with gold taps, marble walls and wood-panelled private cinemas, would be to the taste of Mr Blair's wife, Cherie, is open to question.

However, Mr Blair was lavish in his praise of the show home when he hosted a party there for 70 VIP guests, where an estimated US$10,000 worth of fine French wine was drunk. 'He told us the homes were very impressive and reminded him of an English lawyer's country home,' Ms Li recalled.

Mr Chen's decision to invite Mr Blair to visit appears to have been taken at surprisingly short notice. An Anglophile whose two children both studied in London, the Guangda Group boss apparently invited the former leader on just a fortnight's notice after hearing he was giving business speeches on the mainland and in Hong Kong.

Mr Blair's office filed a series of questions and ran some routine checks on Mr Chen's company, which in a decade had made him Dongguan's most influential developer and one of China's richest men, with a fortune estimated by Forbes magazine last year at US$188 million. Satisfied, Mr Blair's office approved the lucrative Dongguan stop-off within days.

It appeared to have been a masterstroke by Mr Chen. Last weekend, hundreds of would-be buyers from across the mainland were flocking to the complex after seeing newspaper and TV coverage of Mr Blair's visit. The huge influx demonstrated how, despite his spotty reputation in Britain, Mr Blair is held in high esteem among the mainland's status-conscious nouveau riche.

Wealthy Dongguan housewife Zhang Liyun, 35, who toured the show home with two friends, said: 'We came here because we saw Mr Blair visiting on TV and we know that means the price of these villas will go up and up. Mr Blair is world famous and he is very handsome.

'Chinese men like him, too, because he is a strong man and a brave politician - a real man. As soon as these villas go on sale, I will persuade my husband to buy one. If Mr Blair comes to live here, all the villas around his home will command a very high price because people will feel very honoured to have such a man as their neighbour.'

Businessman Qin Qinglai, 32, from Shenzhen, said: 'I am a property developer myself and I already own a property near this development. But my villa can't compare to these ones now, because these are the ones that Mr Blair visited.

'Rich people in China don't buy homes just to live in. They buy them for prestige and that's why being associated with someone like Mr Blair is so important. Now he has been here, this will become the most exclusive development in all of China. I want to buy here as an investment before the price goes

up further.'

In Britain, where newspapers have criticised Mr Blair for his money-spinning overseas speaking engagements, his office has refused to answer questions about his fee, pointing out that he is now a private citizen. Despite that, he was accompanied in Dongguan by the British consul to Guangzhou, Brian Davidson, who also now features in pictures being used for marketing at the sales office.

Asked about his presence, Mr Davidson said he had been invited by Chinese officials. The main purpose of attending the event, he said, was to meet the Dongguan Communist Party Secretary Liu Zhigeng - who greeted the former British prime minister upon his arrival - rather than to accompany Mr Blair.

'It was a private visit and I wasn't involved in the arrangements at all,' Mr Davidson said. 'We weren't asked to be present by Tony Blair and there was no official need for us to be there. But he was here on my turf and it was useful for us to see what is going on and meet with Chinese officials.'

One man who didn't manage to get within hand-shaking distance of Mr Blair on his visit is construction worker Zao Jinmin, 40, from Henan province, working on the many unfinished villas on the site.

'I tried to get close but the security guards wouldn't let us near the villa he was visiting,' he said.

'I earn 50 yuan a day here, and the work is hard. To earn what Mr Blair earned on Tuesday I would have to work for 10 lifetimes without stopping to eat and drink. But I don't mind. He is an important man and he used to be a prime minister, so I suppose he deserves to earn a lot of money.'

With the price of luxury housing rising four times faster than the price of normal homes, and 60 per cent of the mainland's wealthiest tycoons making their fortunes through real estate, it looks as if there will be opportunities galore on the mainland for Mr Blair, Mr Clinton and other retired world leaders.