Hong Kong 1980: The Savage Era

Chapter 554 Chapter 556 [Crisis Approaching] (New Book, Please Collect)
“Also, the company must quickly find someone to take over its shares in other shipping companies. All of them must be sold at market prices, and the funds raised must be used to repay debts. I will make arrangements for the remaining funds when the time comes,” Luo Qihong gave the order.

The shipping industry is highly cyclical, and adjustments need to be made every once in a while, which takes a lot of energy. No wonder the former kings of chartering and Xu Chuan both abandoned their ships and went ashore to become powerful real estate developers.

Today's Hong Kong shipping industry is far from what it was like in the early 80s. Luo Qihong is the only shipping king left in Hong Kong, and the others have been crushed by the wheels of history.

In fact, if the Luo family did not have many industries that required ship transportation, Luo Qihong might not have gotten involved in the shipping industry. This industry is very profitable when it makes money, but it is even more terrifying when it loses money. If you are not careful, it will go bankrupt, just like the original Wheelock Shipping Company.

The business volume of the Luo Qihong family accounts for about 3% of the total business of Siu On Shipping Company, including the trade of Heng Chang Hong Holdings, the construction materials of Bao Hua Construction Company, the products of the electronics company under Siu On Group, the food materials and products of Singapore's Yeo Hiap Seng Group and Frasers Group, and minerals from Australia.

After two or three years, they can purchase low-priced old ships on the market and re-occupy the shipping market.

The news that Zhaoan Group wanted to sell "Anleyuan Building" and De'an Real Estate Company wanted to sell "Yulehang Building" spread quickly, causing quite a stir in the real estate industry.

On Lok Yuen Building and Entertainment Building are high-quality properties second only to the Grade A commercial buildings in Central. They are scarce commodities in the market and it can even be said that they are priced but not sold.

Great Eagle Properties Limited.

Eagle Properties missed the best time to reserve land in the 80s, so it could only rely on three methods to develop: cooperation, government land auctions, and the merger of old buildings. Of course, property speculation was also inevitable.

Today, Great Eagle Properties has acquired an old building near the Mong Kok MTR station and is building Langham Place. It has also made some acquisitions overseas, such as the Langham Hospitality Group.

Hang Lung Properties also follows the rental collection route and owns a number of properties in Central, such as Crown Towers. Its annual rental profit exceeds HK$3 million, which is similar to the profits from property speculation and real estate development.

Luo Yingshek, Luo Jiarui and his son, and the management immediately held a meeting to discuss expansion in Central.

"The group's current strategy is to strengthen its holdings of high-end office buildings, but our presence in Central is very weak. Both the On Lok Yuen Building and the Entertainment Building are what we need. We can only take one. Which one do you think is better?" said Luo Jiarui.

"The locations of the two buildings are similar. The location of the Entertainment Building is probably better, but the On Le Yuan Building has an extra 2 square feet. I think acquiring the On Le Yuan Building is a better choice." A senior executive responded.

"What Mr. Zhang said is that the competition in the Entertainment Building must be more intense than that in the Anleyuan Building. If we do the opposite, we may be able to save some money."

"Luo Qihong is a person who attaches great importance to collecting rent. His Zhaoan Real Estate and Dehe Real Estate companies are both landlords in Central. He has held those Central buildings for a long time. It is a bit strange that he is letting them go now." Although Luo Yingshi is old, he still has a sharp eye.

“It may be that the total investment of IFC is HK$450 billion, and it has won the bid for the Tuen Mun Inland Terminal, so the funds are a little insufficient.” Luo Jiarui said. He roughly calculated that the investment on the surface alone exceeded HK$1000 billion.

Even super groups sometimes face capital shortages, and Luo Qihong has made huge personal investments overseas.

Luo Yingshi thought about it and felt that it made sense, but he was still worried, but he did not stop Luo Jiarui, "Then talk to Zhaoan Group about Anleyuan Building."

A few days later, Kang Wenyi came to Luo Qihong's office to report to him.

"Boss, On Lok Yuen Building in Central has been sold for HK$44.7 billion. The buyer is Great Eagle Properties."

Luo Qihong looked at Kang Wenyi with a somewhat surprised expression. He originally thought that On Lok Yuen Building would fall back into the hands of Sun Hung Kai Properties or Hang Lung Group, but he did not expect that Great Eagle Properties would be so bold.

"The price is good!" Luo Qihong praised with a smile. "Currently, the group has sold 6 commercial buildings in Central, recovering HK$175.6 billion, and some small shopping malls have recovered a total of HK$208 billion, of which HK$166.4 billion is profit, and the profit margin is close to 400%." ​​Kang Wenyi couldn't hide the smile on his face.

Wah Kwong Properties privatized Lok Koo Properties ten years ago and acquired Lok Shing Hong Building, Lok Koo Building, Printing House Building and Lok Kee Hong Building. Now the three buildings in Central have been rebuilt and Lok Shing Hong Building has been successfully merged, with an area of ​​3 square feet. Naturally, it will not be sold off.

Therefore, the only properties for sale are Lok Koo Building and Printing House Building, and the prices are not low, at HK$33 billion and HK$34 billion respectively.

After selling 6 commercial buildings in Central, the Siu On Group only has 7 commercial buildings left in Central. These are not for sale by the Siu On Group, including the Dongchang Building where the current Siu On Group headquarters is located.

The Entertainment Building was sold to Hysan Property Company for HK$42 billion.

When Luo Qihong heard the news, there was not much surprise on his face. After completing the renovation of its business in Causeway Bay, Hysan Property Company would surely be eager to expand the scale of rental collection. They would not miss such a good opportunity to advance into Central.

The sky-high prices of Entertainment Building at HK$42 billion and On Lok Yuen Building at HK$44.7 billion caused a huge earthquake in Hong Kong.

The unit price of 2.47 yuan per square foot created a record for Hong Kong property transactions. Stimulated by this event, Hong Kong real estate once again made great strides.

Of course, some people will notice the strange behavior of Zhaoan Group and Dehe Real Estate Company. You must know that Zhaoan Group has been collecting rent from the Central Commercial Building for nearly ten years, and it has spent a huge amount of money to rebuild it. Logically, it should keep it and continue to collect rent.

Smart people believed in Luo Qihong's judgment and followed suit by selling their properties and even stocks.

However, with this huge upward trend, this action will not have any impact at all.

"Boss, I noticed something interesting." Su Qishan said happily.

"What interesting thing?" It was impossible for Luo Qihong to guess.

Su Qishan explained, "Hang Lung followed us in selling properties in a big way. As far as I know, Hang Lung is the only major real estate company in Hong Kong that did this. Other companies have more or less bought properties."

Luo Qihong paused slightly. Hang Lung Group had not been on the scene for a long time. Although it had recovered from the heavy blow in 82, it had missed the opportunity for development. In recent years, it has been developing steadily. Even in a booming market, it has been very stable.

It seems that "once bitten by a snake, one will be afraid of ropes for ten years", which has caused psychological trauma.

"Well! What are the strategies of Hutchison Whampoa, Cheung Kong Holdings, Sun Hung Kai Properties and Henderson Land Development?" Luo Qihong's focus was not on Hang Lung Group.

"The first two companies are doing what they always do, developing land and selling residential properties. However, Li Jiacheng seems to have a lot of luxury homes in his hands. If an economic crisis occurs, there will definitely be some impact."

"As for Sun Hung Kai Properties, they still stick to the old style, with the family investing overseas and the company developing land in Hong Kong. The intensity of development has increased a lot, but their land is very cheap, so the losses will be very limited."

"Henderson Land Development has reduced its business scope and has slowed down its acquisition of old buildings and land. It should have judged the economic crisis was approaching, just like us."

Su Qishan spoke of it in detail, with admiration for his boss in his eyes. He recalled the symptoms of the previous crisis, and the more he thought about it, the more it resembled the present.

(End of this chapter)