Hong Kong 1980: The Savage Era

Chapter 476 478 [Yeo Hiap Seng Group]

The most important source of revenue for Dehe Real Estate Company is rental. Although Luo Qihong's investment in it has not yet recovered the cost, he has recovered half of the investment and paid off Xiangjiang Property's bank loan.

This is a very good result. Both the Tak Hop Plaza in Admiralty and the new Sun Plaza in Tsim Sha Tsui are the proud masterpieces of Tak Hop Real Estate Company.

Although the geographical location of New Sun Plaza is not as good as Dehe Plaza, its annual rental income is more than 2 million Hong Kong dollars. It is one of the best properties of Dehe Real Estate Company and is worth 20 billion Hong Kong dollars.

If it weren’t for the more famous Harbour City next to it, Sun Plaza would likely become one of Tsim Sha Tsui’s landmarks.

"Yes!" Su Qishan nodded. "We have almost finished acquiring the old buildings in the Star Street area of ​​Wan Chai. We have already completed the acquisition of three old commercial buildings, covering an area of ​​3 square feet. It is expected to build 2.7 floors, with 34 square feet per floor, for a total floor area of ​​2 square feet. The actual usable area is 68 square feet."

"Accountants calculated that the entire commercial building would cost HK$10.6 billion to build. If the acquisition costs are included, the total cost would exceed HK$22 billion. Based on the current rent of HK$31 in Wan Chai, it would probably take 10 years to recover the cost."

Luo Qihong opened his eyes and said seriously, "The cost is small money. The real estate market in Hong Kong will become more and more prosperous. The rent in Wan Chai cannot be only 31 yuan. The cost will be recovered in 7 or 8 years at most."

"And this is not a one plus one equals two calculation. We can refer to what Hong Kong Land has done and connect Tak Hop Plaza with the commercial buildings on Star Street in Wan Chai with a sky bridge. This way the value of the building will immediately increase. I think we can just name it Tak Hop Plaza Tower 3."

"Boss, you are right. When the Hong Kong Land Development Company rebuilt seven commercial buildings in Central and connected them with a skybridge, their value skyrocketed immediately and it is still a legend in Hong Kong today." Su Qishan flattered.

"We'd better borrow money from the bank for the construction costs. We have just acquired a property on Wall Street in the United States, and the company does not have the budget for this yet," said Luo Qihong.

"Okay, I will negotiate with the bank myself and try to get the lowest interest rate." Su Qishan said, "Henderson Lighting Company has been merging buildings in Tsim Sha Tsui and Wan Chai. Can we get a piece of the pie?"

This trick is Li Zhaoji's magic weapon in real estate. Few real estate developers in Hong Kong have such patience. Of course, this business also made Li Zhaoji huge profits.

But it is not so easy to replicate. The reason why Su Qishan dared to say so was simply because the successful merger of old buildings on Star Street in Wan Chai gave him inexplicable confidence.

“It’s not impossible, but you need to be patient. Our strength in Tsim Sha Tsui is still not strong enough, and I also want to build another new Sun Plaza.” Luo Qihong laughed.

It is a good thing that Su Qishan is ambitious. It is an opportunity for Dehe Real Estate Company to increase its assets.

He remembered that in his previous life, Cheng Yu-tung's grandson Cheng Chi-gang built the K11 shopping mall in Tsim Sha Tsui, which brought new vitality to the New World Development Company.

This large-scale building merger is not so simple. For example, the merger of buildings on Star Street in Wan Chai took 5 or 6 years before some results were achieved. If you want to acquire a shopping mall as large as the New Sun Plaza, it will still take a long time to acquire it.

"Then I will immediately ask someone to investigate and look for a new location." Su Qishan said excitedly.

Grabbing New World Development Company's projects is also a good choice.

Early July.

The Hong Kong government has introduced seven measures to combat property speculation, including stipulating a temporary deposit of 7% of the property price, limiting each person to only register once and purchasing one unit when registering a property, and setting up a lottery mechanism for inspecting properties.

However, after the measures were issued, the procedures for selling houses were tightened a lot, and there was some curb on the surface, but in reality, house prices continued to soar, and the trend of house speculation had not improved significantly.

The Hong Kong government seemingly introduced measures to suppress speculators and real estate developers, but in fact 3% of the credit for the rise in housing prices can be attributed to the Hong Kong government.

Nearly 3% to 4% of the Hong Kong government's fiscal revenue comes from land sales, and the government holds government land auctions every time during the real estate peak period, allowing real estate developers to bid and make huge profits.

With such behavior, how can Hong Kong's real estate market not rise? A third of the labor belongs to speculators. They can earn a year's salary by reselling a house, so who would be willing to work hard to make money?

The remaining 3% to 4% naturally belong to the real estate developers. They are well aware of the theory of hunger marketing and will only release a few units each year. They will not meet the market demand all at once and wait for the house prices to rise next year, or even hold on to their houses without selling them.

For example, Siu On Properties holds a large amount of land reserves, but the residential buildings it plans to sell this year are only a few million square feet.

They deceive citizens by saying that there is insufficient funding and manpower, and that their ability to develop land has been maximized.

Of course, it is not just Zhaoan Real Estate that is doing this, other companies are doing the same.

With the real estate market booming, the revenue accounts of Siu On Properties in the second half of the year will certainly look good, but the actions of the Hong Kong government have made him wary, as a scene he does not want to see may occur.

Luo Qihong didn't care about these things. On the third day, he flew to Singapore with Yuan Tianfan and a group of senior executives.

The Luo Qihong family has been operating in Singapore for several years and has invested heavily, and has opened up some situations here. Now they have similar strength to the Huang Tingfang family in Hong Kong in the late 70s.

This was done intentionally by Luo Qihong. He learned the lesson from the foreign invader Qiu Debao who wanted to swallow up Wheelock Company in one gulp when he entered Hong Kong. He adopted the Huang Tingfang family's strategy of gradual advancement. Now it was time to swallow up some important industries in Singapore.

At such an important moment, he naturally had to act personally and could not delegate the task to others.

Inside the meeting room of Singapore Hengan Investment Company.

Many company executives gathered here to discuss a major acquisition.

"Yeung Tien En, the second-generation head of the Yeo King Lian family, died in 87. His third son, Yeo Chi Yau, took over and became the chairman of the board of directors of Yeo Hiap Seng Group. Until now, Yeo Tien En's family has held the power for half a century. When Yeo Tien En was alive, he could suppress the power. Yeo Chi Yau lacked prestige, and the members of the Yeo family had long been ready to make a move."

"Now, Yang Zhiyao is raising shrimps with high technology, opening a fruit processing plant in North America, and acquiring the Chongqing Food Company in the United States, all of which have suffered heavy losses. The Yang family members are extremely dissatisfied with Yang Zhiyao. They are colluding to get him out of office. Some members, Yang Zhiwei and Yang Zhiping, have also contacted us and asked us to support them."

"In order to deal with the opposition, Yang Zhiyao has already brought members of the other four families into the board of directors. At the same time, he recalled his eldest son Yang Weitian from the United States to serve as the head of the sales department. I heard that he is planning to promote him to deputy manager of the sales department."

A senior executive wearing a floral tie was introducing the Yeoh King Lian family and Yeoh Hiap Seng Group.

The shares of Yeo Hiap Seng Group held by its subsidiaries have long been transferred to Heng On Investment Company. Today, Heng On Investment Company is the fifth largest shareholder of Yeo Hiap Seng Group, holding 6.6% of the shares.

The Yeo family holding company owns 38.9% of Yeo Hiap Seng Group, of which Yeo's faction holds 18.3% and the opposition faction holds 20.6%.

No matter compared with which party, Hengan Investment Company is at a disadvantage, and its only advantage is sufficient funds.

"I think it's not a good time to alert the enemy. Many big families will choose to help each other resist foreign enemies at critical moments. The Yang Jinglian family may not be an exception. If we make a takeover and anger the Yang family, we will most likely be defeated, and others will benefit in the end. So I suggest letting them continue fighting among themselves, and we choose one faction to support." Another senior executive suggested.

"Then which faction do you think is best for our interests?" Luo Qihong put down the documents and asked expressionlessly. The assets of Yeung Hiap Seng Group were too rich and he had to get them, even if it cost tens of billions of Hong Kong dollars.

In fact, Luo Qihong not only wanted the factory land worth tens of billions of dollars of Yeo Hiap Seng Group in Hong Kong, but also attached great importance to the soy sauce and beverage industry of Yeo Hiap Seng Group, and obtained the international franchise rights of PepsiCo.

(End of this chapter)