CCBC’s Beijing office, also home of the Canadian Chamber of Commerce in Beijing, was officially registered in February 1981. The bright lights and skyscrapers of Central Business District (CBD) and Sanlitun were yet undreamt of, still decades away. Rickshaws and bicycles ruled the roads, and Deng Xiaoping reigned as paramount leader of China in Zhongnanhai, only a few hundred metres from our original location. We were gracefully hosted in the brand-new CITIC building – then Beijing’s tallest, at 29 floors, also known as the 巧克力大厦, because it looked like an upright chocolate bar – where we coincidentally stayed put for all of 29 years. After a comparatively brief 10-year lifespan in the well-known (and well-worn) Hanwei Plaza, CCBC’s Beijing presence has moved once more, for only the third time in nearly 40 years – and we couldn’t be happier. Since we don’t do this often, this week’s Beijing Dispatch is dedicated to that story, which, from my perspective, is worth telling.

The Grand Millennium Hotel, Beijing

When I arrived in the MD China role in early 2019, I was faced with a challenging outlook – we had sky-high overheads with a large commercial presence in downtown Beijing, and revenue sources were thinning due to the bilateral tensions that plagued so many Canadian firms, including our own. Government and business travel to China was down, events were comparatively few, and public opinion was deeply affected, to say the least. Our business incubation centre was also under capacity, and staffing was brought to its lowest level in several years. The writing was on the wall (along with the flaking paint).

Inspired to make a move, I learned quickly that the Beijing real estate landscape was not an easy one to navigate. We wanted to stay in CBD but needed a reduced floorplan and significantly diminished overheads. We surveyed buildings nearby, saw the price tags, and then dropped our expectations. I checked out buildings further away, and lower in quality, and still had to slash our expectations. 100-150-sqm offices are few and far between, and priced at a premium. We toyed with the idea of co-locating with members or other international chambers, co-working spaces, and more – and still nothing fit our very particular size requirements, administrative needs and budget.

Then, COVID-19 hit.

While a disaster of unmitigated proportions, I’d written in a previous Beijing Dispatch post that companies invested in China should try to find a silver lining by watching the rental market closely over the course of summer 2020. The prediction was that pandemic-related bankruptcies would lead to extended vacancies, and landlords would be highly motivated to move their available inventory. This only came partially true in Beijing. The agents and landlords I spoke to agreed that vacancy was high, but there seemed to be a trend that ran counter to basic economics of supply and demand – landlords were artificially holding rental rates relatively steady in solidarity. That strategy, however, did not extend to hotel proprietors.

Post COVID-19 lockdowns in China saw hotel occupancy in Beijing hover between 3 to 8 percent for the first 7-8 months of the year. Moreover, their restaurants and outlets were generally shellacked by the pandemic, and many had only begun reopening their doors in late summer. Astronomical fixed costs like staff, utilities and rents remained fairly inflexible; for example, local government policies effectively forbid mass terminations to avoid high unemployment levels. Enterprising general managers, spurred on by their owners, were inspired to diversify streams of revenue. Enter CCBC.

The president of another very friendly Chamber here in Beijing knew I was on the hunt, and mentioned that one of their members, the respected Grand Millennium Hotel, had commercial space for lease. My understanding at the time was that he was referring to the associated office tower or shopping mall, but I was instructed to meet the GM at the main doors of the hotel itself, and he steered me up to their hotel business centre. The fully furnished conference-style offices were designed for use by guests that would hold meetings and private discussions on the sidelines of more large-scale events, which, of course, had been non-existent for eight straight months. Furthermore, the adjacent retail space to the hotel business centre was also vacant – it had previously been home to a tailor shop, yet another commercial casualty of COVID-19.

Two very motivated stakeholders shook on it on the spot, and within three weeks, the new lease was inked in a wonderfully win-win scenario. The tailor shop wall came down, new office partitions started going up, notice was given to the previous landlord, several dozen boxes were packed, a metric tonne of old brochures, paperwork and much more was recycled. Our infinitely patient incubation centre clients were moved. Computer up-cyclers came for the old PC towers, cathode-ray monitors, 3-inch thick laptops, and roughly 60 promotional VHS tapes. A painstaking two-week page by page audit of what to keep and what to toss, with many old treasures uncovered, impressed upon me once more how incredible our history is here in Beijing. When the door closed behind me for the last time and the keys handed over, our fabulous Events Director Sue Wang curiously asked me why I was laughing.

Hanwei Plaza, (white, bottom-left) – our home for the last 10 years.

Some lessons learned from this experience. If you are motivated, and have a very capable team (which I am deeply blessed with), you can move an office in China extremely quickly. The time from finding our new space to being fully moved in with all registrations and administrative hurdles being completed took less than a month. Secondly, be prepared to part ways with your security deposit. Perhaps some truths are eternal internationally, but be sure that Chinese landlords are not likely to fork over your bond when you move out, with or without notice. I was white-knuckled on the walk into the office of our previous host to inform them of the move. I was nervous that in this business climate, their purse strings would be even tighter than usual, and they might come after us for lost rent: we still had 18 months remaining on our 5-year lease. Fortunately, a little professional begging and strategic dropping of the phrase “in the middle of a pandemic?!” got us off the hook.

After weeks of labour, we are now fully moved in and are looking forward to toasting the new digs on September 17 with a housewarming night, presented by Power Corporation of Canada. The event is free to attend for members and friends (though we require pre-registration), and we’ll be pouring Canadian wines along with draft beer from our friends at Jing-A on our new terrace overlooking CBD, directly across from our office space on the 3rd floor. Quite the journey, from 1981. A preview, and our new mailing address for your records, are below.

Canada China Business Council | 加中贸易理事会

Grand Millennium Hotel, 3rd Floor

No. 7 Dongsanhuan Middle Road

Chaoyang District, Beijing, 100020, P.R. China

北京市朝阳区东三环中路7号，千禧大酒店3楼 (100020)

Finally, please mark your calendars for October 13th and 14th for CCBC’s 42nd AGM and Virtual Business Forum! Beijing banquet dinner tickets and tables will be available soon. For sponsorship opportunities, please contact Noah Fraser, noah@ccbc.com, or Sarah Kutulakos, sarah@ccbc.com.