December 23, Hutchison Building Headquarters:
Wu Weibing, the person in charge of Watsons, rushed over as soon as Chen Zhiwen arrived at the company, and said to Chen Zhiwen who had just warmed up in his office chair: "Sheng Chen, we have already discussed the price of Wellcome Supermarket with Land and Land. It is HK$55 million, including 16 properties, 55 leased branches, and 12 more that we did not acquire because they were close to our ParknShop supermarket."
"How much are these 16 properties worth based on current housing prices?" Chen Zhiwen asked casually.
"Almost 35 million Hong Kong dollars." Wu Weibing replied.
"That's okay. Let the legal department confirm it. If there is no problem, just sign the contract." Chen Zhiwen nodded and said.
Unless this type of supermarket chain has developed very well and is very famous, otherwise, those rental supermarkets without properties are not worth much money. The bulk of the transaction amount is still the 16 properties that Land has purchased, and The largest number of leased branches, 55, has a total value of only HK$20 million. This is still in a good location and a long-term cooperation agreement has been signed.
"I have already sent the relevant agreement and data to the legal department, and I just need to wait for confirmation there before signing the contract," Wu Weibing said.
"Okay, after acquiring Wellcome, we can rest easy for the time being. However, we still need to complete the layout in the entire Hong Kong as soon as possible. Now that housing prices are rising once a month, we should acquire properties that can open supermarkets as soon as possible. These properties are in our hands, so we will You will always be invincible." Chen Zhiwen continued.
Although Jardine Matheson has withdrawn, who knows whether other players will enter the market, although it is unlikely. Moreover, acquiring supermarket properties as soon as possible is also a very high-quality investment. Waiting for Parknshop to open two or three hundred in Hong Kong A supermarket, most of which are self-owned, covering 89% of the people in Hong Kong, coupled with the cost-effective materials of Galaxy Trading, no opponent can have a chance to make a comeback.
Moreover, once a supermarket becomes large in scale, it will directly collect cash for external business, and there will be a certain payment cycle for suppliers, which will generate a lot of capital flows. Due to risk considerations, naturally it cannot use too much, but as long as it is controlled Well, knowing the cyclical nature of Hong Kong real estate, there is still a lot of room for profit.
"I have also notified many intermediary companies in Hong Kong and asked them to find similar properties. I think that in three months, we should be able to find suitable shops in all densely populated places in Hong Kong." Wu Weibing said.
"Okay." Chen Zhiwen nodded and said, "HSBC's funds don't need to be used in vain. If these supermarkets combined can't be used up, then buy properties in Central or some shopping malls. You can collect rent and wait for appreciation, and you can also prepare for the future. .”
Most properties in Central or shopping malls are controlled by large consortiums, but there are still some small families holding them. Moreover, even large consortiums may sell high-quality assets when they are short of funds or need to develop large-scale projects.
"Okay." Wu Weibing nodded and said.
Christmas is coming again. Chen Zhiwen actually has no interest in this kind of Western festival. He just wants to spend it normally.
A few days later, it was 1977.
After a year of construction, the Galaxy Tower, the headquarters of Galaxy Group, has been completed.
On January 8, Saturday, this day, the management teams of Midea, Galaxy and Red Bull officially moved into the 46-story tallest building in Admiralty.
"This building is really nice." Chen Tianfu walked around his son's office and asked with a smile: "How big is the area?"
"Almost 1,500 feet," Chen Zhiwen replied.
Although the office in Hutchison Building is also very good, the area is much smaller than here. Moreover, Hutchison's office was a merger of several previous offices. Even though it was renovated, it still feels a bit nondescript. The new building here is naturally Differently, the office is located in the southeast corner of the 42nd floor. The huge floor-to-ceiling windows allow the entire office to see half of Hong Kong and the entire Victoria Harbor.
And this glass is also very special. You can see the outside from the inside, but you can't see the inside from the outside. Even if the outside cleaners clean the glass in the future, they won't be able to see anything.
"It's big enough." Chen Tianfu tried the sofa again. It was completely made of genuine leather, and it felt the same as in a car.
"I have also reserved two floors for Hengyi on the 35th and 36th floors. You can also move here." Chen Zhiwen continued.
Although Galaxy, Midea, and Red Bull are now very large, most employees are located near the factory in Yuen Long. Only the top management and external teams will move into this building. Therefore, he deliberately left 3 floors for his father's company.
"Okay, I will move here after the new year and work on Hong Kong Island. It will be different. There are too many buildings in this building." Chen Tianfu said with a smile.
"The decoration downstairs is good, but there are no tables. You can decide the layout yourself." Chen Zhiwen said.
"Well, okay." Chen Tianfu nodded and said.
Chen Zhiwen asked again: "Dad, in one week, the Hong Kong MTR Corporation will start bidding. How much money have you raised?"
"Several properties we previously cooperated with Hutchison Whampoa have all been pre-sold. We have subsequently cooperated with 6 projects, which require a certain amount of capital investment. Currently, Hengyi has approximately HK$110 million in its account." Chen Tianfu paused. Said: "However, we have raised funds together and now have 600 million Hong Kong dollars in funds. During this period, I have been using this money to acquire stocks of real estate companies in Hong Kong, as well as some properties in good locations. , industrial office buildings and Class B official letters, from the book point of view, the average increase last year was almost 30%. If they were all sold now, they would make almost 180 million Hong Kong dollars."
"This is much more profitable than you working so hard to develop so many properties." Chen Zhiwen said with a smile.
As early as the beginning of 1975, Chen Zhiwen asked his old man to raise funds from the private sector, offering high interest rates that were higher than those of banks. The initial results were average, but when Chen Zhiwen acquired Hutchison, his reputation soared, and many people came to save money.
However, with the scale of Hengyi back then, there was no way to accommodate such a large amount of funds. Therefore, knowing that the local market and stock market would inevitably start to rise, Chen Zhiwen asked Chen Tianfu to invest all the funds in real estate companies and real estate-related companies. Listed companies, industrial office buildings with less fierce competition, and Type B official letters for land certificate exchange.
You can make money with these investments with your eyes closed, even when the interest rate is high, you still make money with blood.
"Yeah, I'm starting to doubt my life. I've worked so hard to run so many real estate projects, but they still can't compare to this simplest investment." Chen Tianfu said with emotion.
"So, using other people's money is the fastest way to make money." Chen Zhiwen said with a smile.
Finance is so profitable. Not to mention other countries, many countries in Europe and the United States have begun to de-industrialize in a few decades. The best proof is that they have transformed into finance.
If nothing else happens, a few years later Chen Songqing, the Hong Kong swindler, should have started his legendary life. He also relied on finance to start his career. Real estate is just his tool, although there is also deception in it.
"I have estimated the MTR bidding process and found that the starting capital for this project will be at least HK$300 million. I am now thinking about whether to sell these assets to raise cash." Chen Tianfu said.
"No, just remortgage these assets and borrow money from the bank." Chen Zhiwen said.
"It's okay to operate this way, but the risk will be doubled." Chen Tianfu said with a frown. As a real estate developer, he had naturally thought of operating this way before, but these assets were purchased with borrowed money. If they were mortgaged again, Borrowing money is equivalent to doubling the risk.
"It doesn't matter, the Hong Kong real estate market used to cycle at least five to six years. This cycle has just begun, and it has not yet returned to the peak of 1973." Chen Zhiwen explained with a smile.
"House prices and the stock market were so crazy in 1973. Are you sure this cycle can exceed 1973?" Chen Tianfu asked.
"Absolutely sure." Chen Zhiwen nodded and said that the bubble of 1973 was actually very big, but the real estate market in this cycle reached the level of 1973 in early 1979. No one could have imagined that it would more than double in the future.
Hong Kong's real estate is so crazy. The housing prices in 1981 were shocking, but compared to 1997, they were a drop in the bucket.
"Okay, then I will play with a big one." Chen Tianfu said with a smile. If he is really confident, then the bigger the leverage, the better. Over the years, he has trusted his son's judgment, because every time before , for every mistake.
"Look for some small banks. The higher the interest rate, the higher the interest. You will buy these assets with raised funds. Big banks such as HSBC, Standard Chartered and Hang Seng may not accept this kind of mortgage." Chen Zhiwen added.
"Don't worry, I already know a good Chinese bank, and getting funds from him shouldn't be a problem." Chen Tianfu said with a smile.
"Oh, which one?" Chen Zhiwen asked.
"Bank of East Asia." Chen Tianfu said.
"I've heard that the scale is okay, but you have to build a good relationship." Chen Zhiwen nodded and said.
There are many banks in Hong Kong. The small ones may only have a few branches, similar to the credit unions in later generations of villages and towns. The big ones are naturally HSBC and Standard Chartered. Among them, there are also many medium-sized banks, and the Bank of East Asia is one of the leaders. .
"Of course." Chen Tianfu said with a smile. The most important thing for a real estate company is to have bank relationships. Each of Hong Kong's five real estate giants has the support of a bank. Of course, from a bank's perspective, they also need Cooperate with a strong and secure real estate company.
"It's much more convenient since we have a bank with good connections." Chen Zhiwen continued: "The two MTR sites this time are in Central and Admiralty. It can be said that they are the best land auctions in Hong Kong since the real estate crisis in 1973. , as far as I know, 30 real estate companies or consortiums have signed up to participate in the auction, including Land, Swire, Cheung Kong Holdings, Hehe, New World, and some consortiums from Japan and South Asia.
If we want to win in this, we absolutely need to be well prepared, otherwise, we will not be able to compete with Land in terms of funding. "
"Weren't you forced Landmark to sell Wellcome Supermarket?" Chen Tianfu asked with a smile.
"That's different. Supermarkets are just an industry that Landmark wants to invest in in their spare time. It's normal for them to give up after encountering strong competitors. But this type of property is different. Landmark's favorite thing is to hoard high-quality office buildings. We will definitely do our best," Chen Zhiwen explained.
In the supermarket field, if the Yihe Department is really determined to compete, then even if Chen Zhiwen does not lose, he will pay a heavy price, and the time will be measured in years. However, if you hurt the enemy by one thousand, you will lose one thousand and five. I finally quit after I decided it wasn't worthwhile.
But the land in Central is still located near a subway station, which is too tempting for a real estate company like Land, which has been obsessed with real estate for nearly a century.
"Then what should we do?" Chen Tianfu asked.
"This time the MTR Corporation's bidding is not about raising placards, but each company writing its own conditions in an envelope and handing it over. This is our opportunity. We don't have to go head-to-head with Land," said Chen Zhiwen with a smile.
"I know this." Chen Tianfu said.
Chen Zhiwen continued: "Dad, have you ever thought about what the current MTR Corporation lacks?"
"Funds? They need a lot of money to dig subway tunnels." Chen Tianfu replied.
"Yes, it's funds, but it's not just that." Chen Zhiwen said.
The Hong Kong MTR Corporation is different from the MTR companies in other places. The Hong Kong government does not provide subsidies, but it gives a lot of land near subway stations for the MTR Corporation to auction and raise money.
Without starting capital, the subway company's auction naturally needs to focus on raising money.
"What else?" Chen Tianfu asked.
"Money still has to be given, but in a different way." Chen Zhiwen said: "We will give half of the money first, and then after the subway station properties are built, we will sell them and share a part of the profits to the MTR Corporation."
"Did you learn this method from the cooperation model between Li Jiacheng and Hutchison Whampoa?" Chen Tianfu asked.
"Yes, it has a certain enlightening effect. The MTR Corporation is not a fool. It naturally knows that the land it sells will definitely make huge profits in the future. However, they are restricted by the laws of the Hong Kong government and cannot develop it themselves, so I need Let some of the benefits go to them." Chen Zhiwen nodded and said.
In fact, in the original history, the subway station auction was the one won by Cheung Kong Holdings, which defeated Land, and the method used was similar.
Li Jiacheng knows that companies like Land only like to hold properties for themselves and will not share them with others. Hong Kong's auctions are basically fixed-price transactions, and no one will share profits with the auctioneer. This is unprecedented. .
But Li Ka-shing has an insight into people's hearts. He knows that the MTR Corporation is also jealous of these real estate income. Therefore, he proposed a plan to share the profits with the MTR Corporation after the later development is completed. This naturally impressed the top management of the MTR Corporation and obtained half of the funds first. Not only can you get cash to start subway construction, but you can also get benefits from the rising real estate market a year later.
For Li Ka-shing, this was the first time he defeated Land. At the same time, even if part of the profits were given to the MTR Corporation, he still made a lot of money. Land prices have been rising. In addition, the special value of the land next to the subway station has made the Yangtze River The industry easily made huge profits.
However, now, Chen Zhiwen would naturally not give him this opportunity.
"Seeing that you acquired the Federal and International Buildings, I thought you would also find a way to hold these properties?" Chen Tianfu said with a smile.
"Hold it when you should hold it, and sell it when you shouldn't." Chen Zhiwen said nonchalantly. The office property next to the subway station is naturally a high-quality long-term holding object, but if you hold it yourself, all the funds will be trapped. Live, this is not cost-effective. Anyway, the subway company will continue to expand in the next ten years. If you want to hold properties next to subway stations, there are plenty of opportunities.
Even if you wait until 1983, when housing prices plummet, you can easily get it if you have the money to buy it.
Friday, January 14th.
It was drizzling in the sky, and Chen Zhiwen and Chen Tianfu came to the most famous hotel in Hong Kong, which was also the one that Liu later attacked.
The owner is the Kadoorie family. This family has been operating low-key in Hong Kong, but its scale is no less than that of other foreign companies. In addition to this large hotel, as an ancient British capital, it also owns a large number of high-quality land properties. , and the Kadoorie family's greatest wealth is the power company CLP Power that controls the entire Kowloon Peninsula.
"Li Sheng, long time no see." Chen Zhiwen just walked into the large conference room and saw an acquaintance.
Li Jiacheng still wore a pair of black-rimmed glasses and said with a smile: "Hello, Mr. Chen. I haven't seen you for more than half a year. I can only watch Mr. Chen dominate the Hong Kong shopping mall."
"Thank you." Chen Zhiwen said with a smile. In fact, he didn't do any big things during this period, except for the acquisition of two Wheelock buildings and the expulsion of Jardine Matheson from the retail supermarket market. However, for ordinary Chinese-funded companies, any one item is indeed not small.
"When Chen Sheng comes here, it seems that Real Estate has encountered a strong enemy." Li Jiacheng continued.
"I think Li Sheng is my biggest enemy." Chen Zhiwen said with a smile. Many big companies were present today, which also attracted a lot of media attention. It is speculated that Land has the greatest possibility of winning this auction. , after all, he is the land king of Central. If he is really determined, how many other companies will be his rivals?
(End of chapter)
