Tuesday, 7 June 2016

Have HK$2.1 Billion to Buy a Home?

An undated photo of Chen Hongtian, the new owner of a HK$2.1B home
There may be a lot more uber rich people in Hong Kong than we thought there were.

The latest zillionaire came out of the woodwork yesterday and plonked down a record HK$2.1 billion for a 9,212 square-foot property at 15 Gough Hill Road on The Peak.

That works out to about HK$220,000 per square foot.

Chen Hongtian is a major stakeholder of China South City Holdings, a public company listed in Hong Kong worth HK$2.5 billion.

The home is unfinished so Chen can make modifications
He explained to a local media outlet that he bought the massive property because the other one he bought in August was too small.

"I initially planned to move into the home I bought with HK$380 million last year. But I felt it was a little too tiny [for my family] and [I would need] to live in a bigger one later on. That's why I bought this house," Chen said.

Uh huh.

The "tiny" property he bought was at Opus Hong Kong, the Frank Gehry-designed curvy building, purchasing a flat that is 5,154 square feet, or HK$75,000 per square foot.

According to Chen's autobiography called Aerial View on the World of Mortals, he explains he made his first pot of gold in 1979. Then age the age of 20, he ran his own tailor training school after two weeks of teaching himself the trade.

Surely that would raise red flags, as it takes years for someone to master the art of tailoring. But perhaps if you're teaching others, it's all about the number of students, not necessarily what they learn...

His other home, Opus Hong Kong, designed by Frank Gehry
Then in 1984 he started importing and exporting, buying up garment factories in Guangdong. Six years later he began real estate development in Shenzhen and neighbouring areas.

It was around that time that Chen bought his first luxury property in Hong Kong to live in on Kennedy Road for HK$4 million, followed by another property on May Road. He apparently also have many properties abroad.

Despite the dubiousness of how he initially made his money, Chen is a smart investor, putting his money into real estate.

And probably not surprisingly, he is quite pro-Beijing in his views, publicly calling for severe punishment for those who start online rumours, and those who were at the Mongkok riots.

Has anyone checked to see if he or his company is named in the Panama Papers?

Just wondering...

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