Historical and business ties run deep between Los Angeles and Hong Kong. Dating back more than 170 years, they continue today in trade ranging from electronic and agricultural products to textiles and wine.
It was the 1850s gold rush that first attracted the Chinese to California, making them among the first Asian immigrants in the United States. But soon the lifestyle, educational opportunities and growing Chinatown in Los Angeles attracted prospectors of a different kind: those seeking to share the American dream.
In 1850, the US Census showed there were just two Chinese residents in Los Angeles. Today, their numbers have swollen to the extent that California now has the largest ethnic Chinese population in the US. In terms of business ties, Hong Kong is California's sixth-largest trading partner. Last year, Californian exports to Hong Kong were worth US$6.8 billion.
The 2008 financial crisis produced a new breed of Chinese in Los Angeles: the bargain hunter.
When the Los Angeles Sheraton Universal Hotel was sold to Shenzhen New World Group earlier this year, the price was undisclosed, but if the widely mooted figure of US$90 million is correct, this was something of a windfall for the Chinese buyer (which also bought the Los Angeles Marriott Downtown last year for an estimated US$60 million). The Los Angeles Times reported that the seller, a local developer and landlord, paid US$122 million for the hotel at the top of the market in 2007 and spent US$25 million on improvements, but lost control of it last year after the recession battered the travel business.
The report quoted Jim Butler, a Los Angeles hotel lawyer who worked on the Sheraton deal, as saying that those who invested in hotels from 2005 to 2007 ran out of money. 'Overnight, properties dropped 50 per cent or 60 per cent in value, and cash flows fell through the bottom,' he said.
Residential homeowners felt the pinch, too: in September 2008, industry analyst MDA DataQuick found that 46.9 per cent of all homes sold in California the previous month were foreclosed properties. That helped send the statewide median home price plunging 35.3 per cent for the year, the firm said.