Ties That Bind - Bay Area Council Economic Institute

Bay Area-China Trade: Behind the Numbers
design concepts for creativity, relationship to context and constructability. Top finalists receive
stipends; winning design firms have an opportunity to negotiate to provide further design services.
While the process is generally open and transparent, as with everything in China, relationships
can be important.
Foreign architects are currently limited to presenting preliminary designs, providing aesthetic,
structural, materials, energy-efficiency, spatial use and other expertise to “local design institutes”
(LDIs) of architects, construction engineers and building code compliance specialists. Requested
drawings may be only 50–75% complete, compared to detailed plans submitted in the U.S., allowing
flexibility for the LDIs to lock in a final design. A developer may continue to retain a representative
of the foreign firm through the construction phase to work with the LDI, or may
terminate its relationship once drawings are submitted. Likewise, foreign construction firms can
serve as general contractors, but the actual construction work is subcontracted to local firms.
At times the process has produced creative tensions as the original design concept is dramatically
changed to lower costs, address code issues or put the developer’s or LDI’s creative stamp on a
project. Still, partnerships between foreign architects and LDIs are being institutionalized, and
China is becoming an increasingly important market for many Bay Area design firms.
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Despite the constraints, architects find China an exciting market. Developers and investors embrace
unique, landmark designs. Safety codes are strict, but interesting use of space, materials and
green design are welcome. Projects move through the approval process in months, not years.
Low labor costs change the economics of large scale, multi-use projects, whether a highrise
tower or a new community. And foreign architects have only scratched the surface of the China
market. Nearly 100 cities in coastal areas and along the Pearl and Yangtze Rivers boast populations
of more than 1 million and are growing. Many of the largest signature construction projects
in China—from skyscrapers and commercial districts to resorts and planned communities—have
been designed by Bay Area architecture and urban planning firms.
Architects
Gensler Architecture Design & Planning had a Hong Kong presence for years, serving primarily
international clients there and in China. But as the China market opened, as Northern
China emerged as a new global business center, and as currency convertibility and taxes became
less of an issue, Gensler opened a Shanghai office in 2002. The office’s staff of 30 consists
mainly of local hires, and is structured as a wholly foreign-owned enterprise. Gensler principal
Ray Shick says the firm is committed to building a stand-alone entity that will generate business
on its own, with occasional specialized support from the Gensler team worldwide. Down the
road Shick sees partnerships with Chinese LDIs and with engineers who have left LDIs to form
their own design firms, to bid for projects. For now, many Chinese clients prefer to have the
most important design work done abroad.
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