The office of Tone Goh, president of Office General, is on the 15th floor in Shanghai’s swank Plaza 66. Goh arrived in China in 2000, bringing with him his San Francisco company which rents high-end business offices in five cities across the mainland. Drawing on this own experience as a newcomer to China, Goh has made it his firm’s legacy that finding office space in China now is much faster and more convenient than when he first arrived. He sat down with CHINA ECONOMIC REVIEW to talk about how there’s a perfect fit for any company looking to set up a base of operation.
Q: What expectations should foreign companies have when looking to set up an office in China for the first time?
A: At this point, China’s top-tier cities are no different than Hong Kong, or San Francisco for that matter. They have reached full maturity. Very sophisticated real estate agents speak multiple languages. Anyone – even without a background in China – coming in has nothing to fear. We offer a full concierge program with staff fluent in English, and technology-wise, things are comparable with Western locations. There are also instant offices, where we become kind of like a work hotel. People can check in and within minutes we start them up. Phone lines and internet are already installed and bills are consolidated.
Q: What kind of time commitments are you seeing from companies using your offices?
A: It’s usually six months to a year, which has been quite standard over the years. But we also offer rates by the day and even by the hour to accommodate transitional periods. With a pay-as-you-go system, there’s not much paperwork involved.
Q: How do small- and medium-sized enterprises differ from Fortune 500 companies when searching for office space?
A: Big companies have much more specific demands, but they can afford them because they have no budget constraints. They only go for the best business centers. For the middle and smaller guys, they’re looking for a way to project that their companies are legitimate. For this, they need a recognizable address. If [you own a small business] and your office is out in the middle of nowhere, people are a little bit wary.
Q: What kind of clients are virtual offices suited for?
A: Virtual offices are for those with smaller budgets and also for those who don’t need around-the-clock offices, as they may not spend much time at the office. But they still need our services to help collect and sort their mail and answer their calls. For people like this, it would be wasting an asset to have a nice big office with a nice view if they’re not showing up.
Q: What challenges have you seen working in the China market?
A: Personally, the cultural differences between different provinces and their dialects can be a problem. When working in the US you never have this problem, but coming to China, if I wanted to go to, say Inner Mongolia, I’d have to bring a translator. But in these second-tier cities there is unbelievable growth. I would estimate in the next five to eight years, those second-tier cities will be economically comparable to cities in the biggest three nations in the world. It’s all happening because China has a way of cloning itself. Whatever has worked in some places will spread everywhere.
Q: How are you preparing for the 2010 Shanghai Expo? What do you expect to happen between now and then?
A: Whatever the city will do to promote the event, we will send out that message through our own networks. I’m a member of the San Francisco Chamber of Commerce and was part of the Singapore American Business Association’s board of directors, so I’ll do some PR of my own. Of course I’ll attach Office General’s brand as part of it, and we may even be a small sponsor of some kind.
Q: Where do you see the long-term trends of top-end office spaces as opposed to mid- or lower-grade offices going?
A: The market is going toward the two extremes. There are people looking for six-star, nothing-but-the-best office services and cost is completely not a problem. And at the same time, the budget market is proliferating. Toward the end of 2008, we’re planning to launch “class B” business centers marketed toward budget-conscious local businessmen.