Alibaba representatives applaud as the opening bell of the New York Stock Exchange is rung before the IPO of Alibaba Group Holding Ltd on Sept 19. Lucas Jackson / Reuters

Rain fails to dampen a parade stretching from hangzhou to new york

As night fell about 6 o'clock and the streets of downtown Hangzhou filled with workers rushing off to enjoy their weekend, the dampener to proceedings was persistent light rain that made negotiating the traffic jams a little more perilous.

Twelve kilometers to the west the streets around Alibaba Group's headquarters were all but deserted on this Sept 19 night, many of the company's 20,000 staff sitting or standing in front of a giant television screen inside waiting to witness the big moment.

At 9:30 pm that day, 9:30 am in New York, Alibaba's IPO would be launched on the stock exchange there. But at times it may have been hard for the few braving the rain outside to know whether they were in Hangzhou or New York. Alibaba's main entrance had been decked up to look like the gates of the New York Stock Exchange, a replica of Wall Street's famed bronze bull had been corralled to stand guard for the occasion, and all the signs that should say "Wangshang Lu, Hangzhou", seemed to be saying "Wall Street, Manhattan".

Inside, work had taken a back seat, and the mood was festive, with cheers ascending periodically, selfies being taken by the hundreds and the uniform of the day being T-shirts with messages referring to the IPO.

At 8:30 pm, with an hour to go before the big moment, the company's chairman, Jack Ma, and two other executives appeared on the television screen. This, he told them, was a day to remember.

"What we get today is not money, but trust. Without your trust, without your families' trust, we would not have achieved this."

Ma's words from New York brought many to tears.

At 9:30 am in New York, eight Alibaba faithful flown in for the occasion, including sellers and buyers, rang the stock exchange's opening bell, and fireworks shot up into Hangzhous' wet skies. At the company headquarters, celebrations went into overdrive, foreshadowing a sleepless night for many.

Zhou Xirui, an employee of the company's marketing department, says the biggest fortune that Alibaba had given her was a dream.

"He (Jack Ma) is the best dream seller. Working in the company has made me dare to dream, and today's IPO proves that our dreams are being realized."

On the front of her T-shirt were the words "We still need dreams" and on the back "What if they come true?"

IPO fever was being felt all around Hangzhou. Seconds after the launch, the municipal government congratulated Ma, saying Alibaba was the pride of the city and its people, and the company had become a golden calling card for Hangzhou.

For many Alibaba employees, pride and the IPO's success was gilded by the fact that it had turned them into millionaires.

According to an Alibaba document filed with the US Securities and Exchange Commission, the company had issued 26.7 percent of its shares to current and former employees.

Zhou said that those who have worked with the company for more than three years are eligible to claim shares. She reckoned that no more than 65 percent of them have shares. Alibaba has more than 22,000 employees.

Although the company did not reveal employees' individual shareholdings, there seemed little doubt that the IPO would put billions of dollars into thousands of hands.

However, Li Wenji of the company's PR department said the media had overestimated the fortune Alibaba employees will have.

"It is true that high-level executives will benefit a lot, but not everyone has shares. Most basic level employees are newcomers."

But at least one real estate company in Hangzhou seemed to be in no doubt that the wealth the IPO had delivered to many of Hangzhou's citizens would make them likely prospective customers.

Days before Alibaba's offering, Zhejiang Dahua Real Estate Development Co posted an advertisement online saying that "my neighbor Ma went to New York to ring the bell", indicating that Alibaba's chairman has bought a house in a residential complex the company has developed.

Hu Yanhua, general manager of the developer's marketing department, says one of its strategies is to advertise the company's newly developed complexes.

"Ma and high-level executives of Alibaba account for 20 percent to 30 percent of the complex's tenants, and with the company's listing, more of its employees will be thinking of buying homes."

Hu says the development is a terrace complex aimed at medium-and high-end buyers, and every terrace enjoys great privacy.

"The complex is only a block away from Alibaba headquarters and I reckon it will be their first choice," Hu says.

The company has also drawn up advertising campaigns aimed specifically at Alibaba employees, she says.

"The marketing strategies will focus on the high-end of the complex, because that's what they would be looking for given how much money their shares have delivered them."

Hu Lingbo, a real estate expert in Hangzhou, says the Alibaba IPO may even save Hangzhou's luxury real estate market.

"Buying real estate is still a basic desire that Chinese people have. After the IPO, medium-and high-level executives will hold large amounts of capital. They are sure to buy upmarket apartments or houses."

Since Alibaba moved into its new headquarters a little more than a year ago, 28 houses, each worth more than 10 million yuan, have sold, she says, and that in a generally floundering market.

These executives would invest in areas near Alibaba's headquarters, she says.

"In fact, real estate developers have been eyeing the Xixi area where the headquarters are. Some new complexes are being development, aiming at attracting these newly wealthy people."

The Hangzhou government is also pulling out all stops to use the exposure Alibaba has gained internationally to give a fillip to the city.

The IPO has given the city an unprecedented opportunity to promote its tourism, says He Yixing, director of Hangzhou Tourism Promotional Center.

"Next year we plan to work with Alibaba on projects to attract tourists from the United States and Europe."

yanyiqi@chinadaily.com.cn

(China Daily European Weekly 09/26/2014 page8)