They found their home through a real-estate agent who specializes in sourcing old houses (and who happened to be the cousin of one of Ms. Lam's employees).

WSJ: Luxury Real Estate: Embracing Old Shanghai in a French Concession Lilong

Buying agent Jo Eccles, managing director of Sourcing Property, says she's skeptical about creating new residential districts from scratch.

WSJ: A Diplomatic Breakthrough