A surge in demand for luxury homes and apartments in Hong Kong has lured US-based estate agency franchise Sotheby's International Realty to enter the market.
Local property broker Samson Law Lai-choi, owner of estate agency Hong Kong Homes, has secured a 25-year master franchise agreement to develop the Sotheby's brand in Hong Kong. 'Everyone knows the name Sotheby's,' Law said. 'We have already recruited 20-plus sales staff and aim to increase this to 40 within one year.'
Local rivals said they were not in awe of their new big-brand international competitor.
'Hong Kong is a mature market. It will prove difficult for a newcomer to make an impact. It is going to be a tough job for them,' said Joseph Tsang Hon-ping, international director and head of capital markets at Jones Lang LaSalle's Hong Kong office. 'We had been approached by the US company for business co-operation opportunities a few years ago. But we did not feel comfortable with the business model.'
Other property agents said they did not feel threatened by the newcomer. 'We have more than 10 branches in the Mid-Levels and Island South. Can a company with only an office address compete with us? It will not be easy,' Vincent Chan Kwan-hing, executive director of Midland Realty, said.
Louis Chan Wing-kit, executive director of Centaline Property Agency, said there was room in the market for more players, and new entrants would not affect its leading position. He said Centaline was responsible for settling some 25 per cent of luxury transactions valued at HK$20 million or above. 'We have established a very strong network of street shops and a database. That results in an operational cost of more than HK$100 million every month.'