Chapter 491: The Huge Profits of Changxing Real Estate

"Mr. Yang, the contract has been signed." Zheng Zhijie and Fang Xianming carefully handed over two documents and said, "Now we just have to wait for the joint loan funds from HSBC, Standard Chartered and Citibank to arrive, and then the transfer will be formally completed."

"Okay." Yang Wendong took the document, read it through, and asked, "Is there any problem with the banking consortium?"

Fang Xianming smiled and said, "Don't worry, Mr. Yang, there will be no problem. This time we are using some of Changxing Shipping's oil tankers as collateral. This is a very high-quality collateral and all banks are very optimistic about it."

"Haha, indeed." Yang Wendong nodded and smiled.

In 67, an economic crisis broke out in Hong Kong. The Middle East was in chaos. The Suez Canal was closed, causing a surge in global shipping demand. As a result, an oil tanker could earn back its investment in one year, and then it would make a lot of money.
Although the bank did not know that the Suez Canal would last for 8 years, Egypt has now been forced to lay mines on both sides of the canal. In this case, even if it is restored today, it will probably take a long time to clear the mines, so ships will be hot-selling items for a long time to come.

Fang Xianming added: "In fact, the available mortgage quota of Changxing Industrial has not been used up before. It is just that I think it is unnecessary to expose a lot of our company's profits to those banks, so I will try to use ships as collateral in the future. Anyway, the profits of ships are known to the world."

"You did a great job. Then you can mortgage Changxing Shipping. If you don't need to use Honor Electronics and Changxing Industry, you don't have to use them." Yang Wendong agreed naturally, and then looked at Zheng Zhijie: "Old Zheng, during this period, the entire group has been serving you. When the real estate market recovers, the situation may be reversed. We will need your funds to invest in other industries."

The biggest advantage of real estate is that it can appreciate in value as a whole in the future. A property bought for 1 million today may be worth or million in a few years, and it can be easily mortgaged for or million. This is impossible in other industries, and shipping is a special case in recent years.

Zheng Zhijie smiled and said, "No problem. Now our group has 16 buildings in Central alone, and more than 500 million square feet of properties or land in other places in Hong Kong Island and Kowloon. These will definitely be the best assets in the future.
This does not include the properties purchased by other brother companies. The land they own is not counted on my side. The land area they own has long exceeded 10 million square feet, but the location is not so good, and it is also industrial land. "

In addition to the three buildings owned by Swire, Cheung Hing Properties has also acquired five properties from some medium-sized British consortiums in the past few months. In addition, in the past few years before this year, Cheung Hing Properties has also made several major investments in Central, including taking over some properties from Liu Chong Hing Bank. Therefore, it now has 5 buildings in Central.

In addition to Central, a large number of properties and street shops have been purchased in towns such as Admiralty, Tsim Sha Tsui, Causeway Bay, and Happy Valley. There are also about 10 complete buildings. However, the buildings in these places are relatively small. Places with cheap land prices will not build very tall buildings. The total area of these has exceeded 500 million feet.

"Those plots of land will probably not be moved for more than a decade, so there's no need to calculate." Yang Wendong said, "For Changxing Real Estate, I only look at those commercial plots that can be developed and rented out at any time."

"I understand." Zheng Zhijie nodded and said, "I am still looking to acquire various high-quality properties, but the recent news seems to be a little better, and many people have begun to wait and see."

Yang Wendong smiled and said, "It has been such a long time and Hong Kong is still safe and sound. Normal people will indeed wait and see. If they come across a suitable location again and the owner is a little hesitant, then they will increase the price appropriately and take it down quickly."

There was still about a month left, so he naturally had to get it done quickly. Although the properties previously acquired by Changxing Real Estate could basically make it the second largest real estate company in Hong Kong, no one would think it was too much;

In the next few decades, Hong Kong's real estate will be the most valuable asset second only to stocks of some Internet technology companies. Especially now because of his existence, it is unknown whether there will be any major changes in the electronics industry in the future.

Zheng Zhijie said: "I understand."

Yang Wendong continued, "Then let's complete the process as soon as possible. After the acquisition is completed, I will go to the interior of these buildings to take a look. I haven't been inside yet."

Although he had seen Prince's Building, Edinburgh Building and Murray House from the outside, Hong Kong is not that big after all, but he had never been inside these buildings.

"Okay." Zheng Zhijie agreed.

Two days later:
Yang Wendong arrived at the downstairs of Prince's Building at 10 Chater Road, Central. Looking up, he saw the 27-storey height, which might not be enough for small towns in the mainland in the future, but was considered very tall in Hong Kong at that time. It was not until the late 70s that buildings of 30 to 40 floors or more began to appear in large numbers in Hong Kong.

"Have the managers of these buildings been replaced?" Yang Wendong asked.

Cheng Chi-kit replied: “Most of the British foreigners left. Of the few who were willing to leave Hong Kong Land, I also stayed. The rest of the Chinese basically did not leave.
Anyway, it’s just about managing property, hygiene, accounting and other issues. The business of the real estate company is very simple, so I can take it over directly.”

Yang Wendong nodded: "It's really convenient. If it were other business, it would take a long time just to hand over."

Collecting rent is the simplest and best model for rich people to lie low. Many Chinese families in Hong Kong were exposed in the 80s and it was discovered that they often owned an entire street as property, with the entire family waiting for rental income.

This is actually a very good way to ensure the continuation of the family. As long as the children do not gamble, they can live without worries for several lifetimes by collecting rent from many properties, unless there is a problem in the city. As long as the scale is large enough and they invest in properties in multiple cities around the world, it is almost 99% safe.

"Yes." Zheng Zhijie smiled and said, "We at Changxing Real Estate are also very experienced in this area."

Yang Wendong said, "Okay, let's go in and take a look." Everyone entered the building. The people inside knew that the new boss had arrived, so they were very polite. The property manager even introduced the situation of the entire building one by one.

After listening to this, Yang Wendong asked, "That means even the Prince's Building has nearly 30% vacant space?"

"Yes, Mr. Yang." Manager Cui of the property management company said, "During this period, many customers suffered heavy losses and had to withdraw their money. Some of them also emigrated or their rent expired."

Zheng Zhijie also said: "Mr. Yang, our previous property management had this situation as well. Many people would rather not pay the deposit, and then they ran away. It was difficult for us to sue them."
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"Well, it's indeed not easy to do business at this time." Yang Wendong nodded.

Most of those who rent such places are for internal business, such as finance, law, trade, etc. Once the Hong Kong economy is not doing well, their business will be directly affected.

Factories, on the other hand, are much less affected because the workers are generally ordinary people and cannot escape.

Manager Cui then said, "Mr. Yang, shall we go up and take a look around?"

"Okay." Yang Wendong nodded.

Everyone followed Manager Cui and took a walk inside the building, and then went to the nearby Duke Building and Murray Building. Both are in Central, not close to each other but not far away.

"The scenery of these buildings is much better than that of Changxing Building." After looking at it, Yang Wendong said with a smile.

Zheng Zhijie said: "Yes, the Changxing Building was previously purchased by Liu Chongxing Bank. At that time, although Liu Chongxing was developing well, it was far behind Hong Kong Land, and the location of the land it purchased was far inferior to Hong Kong Land's several core properties."

"Yes, there are more than a dozen buildings owned by Jardine Matheson around here. It's really luxurious." Yang Wendong looked around again.

Jardine Matheson has dominated Hong Kong for a century. Its core assets are Hong Kong Land and Wharf Holdings. The former is larger in scale, and the dozen buildings in Central are just one of its core industries. In other parts of Hong Kong Island, it still has many properties, land, buildings or shops, etc.
The latter has a large dock, a large number of warehouses in prime locations, etc. Once the port is relocated, these will also be high-quality assets.

Fang Xianming next to him whispered, "Mr. Yang, in recent months, I have acquired about 3.1% of Zhidi's shares."

"What about Hutchison Whampoa and Jardine Matheson?" Yang Wendong asked again.

Fang Xianming replied: "Jardine Matheson has currently acquired 2.2% and Wharf Holdings has acquired 2.8%."

"The land is the most." Yang Wendong said with a smile.

Fang Xianming said, "Yes, Hong Kong Land also holds shares in Wharf Holdings. If Hong Kong Land is really acquired, Wharf Holdings will also be acquired. Although Jardine Matheson has shares in Hong Kong Land, it does not hold many shares, and Jardine Matheson's core industries are overseas. In addition, there are not many shares in circulation in Jardine Matheson, so the acquisition is the least."

"It's not easy to take over Jardine Matheson." Yang Wendong asked again, "What about Dairy Farm International?"

Fang Xianming said: "The total market value of Dairy Farm International is much smaller. I have already acquired 5.6% so far."

"Okay, then we'll keep a low profile, continue with acquisitions in this way, and plan for the long term." Yang Wendong nodded and said.

As a giant that has dominated Hong Kong for 100 years, Jardine Matheson has a lot of assets overseas. So if he really wants to go up against it, he is not completely sure, at least not at the moment. At the same time, the existence of the British Hong Kong makes this temporarily unfeasible.

Just wait a few more years, when British capital and even Britain decline, and Jardine Matheson's overseas investments are bleeding due to too many losses, then it will be the right time. The most important step here is whether the acquisition of Dairy Farm by Swire Properties will happen again. If, as in the past, Swire Properties dilutes its own shares significantly in order to acquire Dairy Farm, then it will give itself an opportunity.

But because of my existence, it is hard to say whether this will happen again. If it does not happen, I will have to find a way to take over the Milk Company in the future. This is also a very high-quality company, but it is currently operated by Chinese capital, so it is not convenient to use force. I can only wait and see.

"I understand." Fang Xianming agreed.

PS: Please give me a monthly ticket
(End of this chapter)

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