Chapter 412: Massive Profits from Changxing Real Estate and Future Investment Plans
As the head of the company, once Yang Wendong had made the decision to invest, he typically no longer involved himself in the details of negotiation—even for projects involving tens of millions of U.S. dollars. All that remained was for him to stay updated on progress periodically.
After meeting one more time with Lu Yunsheng, the two parties agreed to continue in-depth negotiations. Yang Wendong then returned to Hong Kong with his family and part of his team, leaving Zou Wenhuai, the head office staff, and a group of professionals in real estate, law, and commerce behind in Singapore to continue talks with the Lu family capital group.
Upon returning home, Su Yiyi asked, "How was Singapore?"
Yang Wendong smiled, "Not bad. When there's a chance in the future, you all should go take a look too."
"Why not go together?" Su Yiyi pressed.
Yang Wendong shook his head and replied, "In the future, we should avoid having the entire Yang family in the same foreign place, on the same plane, or even in the same car."
Although the likelihood of an accident was very low, it was still best to minimize risk.
He had talked casually about this with Lu Yunsheng, and learned that in the Lu family, the father and his four sons were not allowed to ride the same plane, nor share the same elevator or vehicle. Some family members weren't even allowed to travel to the same overseas destination at the same time. It was all about avoiding worst-case scenarios. Of course, in one's own territory, that level of caution wasn't necessary—family would naturally live together, and their home areas were heavily secured. As long as no one launched a full-scale military attack, they were safe.
"This is about security?" Su Yiyi quickly grasped his meaning. "Yes, we'll definitely have to do that, especially once the kids grow up."
Yang Wendong nodded. "Right now, they're still too young. But once they grow up, our family foundation will be stable."
In terms of his various ventures, Yang Wendong was confident that his planning would ensure smooth operations. At the group's current scale, even if his actions shifted the timing of the Hong Kong property crisis, the most that would happen is a slight dip in profits. The fundamentals of the Changxing Group would remain unaffected.
Going forward, his real estate strategy would shift toward accumulating high-quality properties. Development work would be left to future giants he'd invested in—like the Four Big Families, or other upcoming real estate tycoons. This way, he could avoid most risks. Even if history changed slightly, people like Li Ka-shing or Lee Shau Kee were still likely to rise.
Beyond real estate, shipping was outside of his control. As for Changxing Industrial's manufacturing business, he foresaw no issues. Not to mention the coming electronics era, where opportunities abounded. Add in his financial investments, and his foundation was rock solid.
His biggest concern now was the safety of his family. Once wealth passed a certain threshold, this became a serious issue.
"Yes, we'll have to wait until the kids grow up," Su Yiyi nodded.
"Mm." Yang Wendong smiled.
Raising children took time. In modern society, it took 22 years just to get through university, and even then, more time was needed to prepare them to take over. Realistically, it would be closer to 30 before they could handle real responsibilities—and even then, there was no guarantee they'd succeed.
Of course, in modern enterprises, family members didn't always need to run things directly. But even if his children didn't take over, they needed the ability to supervise professional managers. And in this era, most Chinese tycoons still preferred their children to succeed them. Even if they later hired managers, succession remained a top priority.
That's why the education of elite families was more important than business success itself.
—
Time passed quickly, and October arrived. Each Changxing subsidiary continued developing according to plan.
Wednesday, October 7th:
Zheng Zhijie brought in a quarterly report to meet with Yang Wendong and said, "Mr. Yang, this is the data for all the properties we've liquidated over the past three months. We've sold 3.7 million square feet, totaling HK$112 million."
"These were mostly mortgaged, right? How much have we repaid?" Yang Wendong asked, smiling.
Zheng Zhijie replied, "We've repaid HK$37 million. Including about HK$10 million in interest paid earlier, our profit across all these transactions is approximately HK$68 million."
"HK$50 million in principal and interest?" Yang Wendong asked, then looked carefully at the report.
Zheng Zhijie quickly explained, "Mr. Yang, when we purchased these properties, we used 30% equity, 70% bank loans, with relatively high interest rates.
But as property prices rose, our leverage decreased, and we did several second mortgages. The books are complex, but on average, property prices tripled over the past few years. So no matter how high the interest, we still made plenty."
"Mm," Yang Wendong said, reading through the document. He could understand the overall numbers.
After a while, he set the report down and smiled. "Seems the return is solid. These three months' profits alone surpass even Changxing Industrial or Changxing Shipping."
Zheng Zhijie laughed. "But we can't compare directly. This is just the final return of several years' investment, only now being realized."
"How much square footage remains to be sold?" Yang Wendong asked.
"About 2.5 million square feet. We'll finish selling those before December. These properties are in better locations, so we expect prices and profits to be similar or slightly higher than before."
"So before the end of the year, we'll have cashed out nearly HK$150 million?" Yang Wendong asked.
"Yes. That's the total return from our real estate unit over the last few years," said Zheng Zhijie. "In addition, we still have 2 million square feet in prime locations—Central office towers, street-level retail, and so on. Today's market values that portfolio at no less than HK$200 million, though it still carries tens of millions in debt."
"If we're not liquidating those, we won't need to assess value now. Just keep them on the books," Yang Wendong said. "And don't forget, you also provided properties to other group subsidiaries. The ownership may have transferred, but it was still part of your division's contribution."
"Yes," Zheng Zhijie nodded.
Yang Wendong continued, "Real estate is truly lucrative. Based on the past few years, we've netted HK$150 million, plus 2 million square feet of premium commercial assets. This performance isn't far behind Changxing Industrial's."
Even though Hong Kong's property market in the 1960s hadn't yet gone full-blown crazy, profits were already much higher than in traditional manufacturing.
Of course, much of this was due to Yang Wendong's knowledge from the future, his boldness, and the scale of his investment.
But in any case, the returns were eye-opening. By the late '60s, Chinese tycoons led by Li Ka-shing began shifting their focus toward real estate, gradually abandoning factories. That was natural. In Yang's previous life, there was a time when property tycoons far out-earned industrialists.
"All thanks to your leadership," said Zheng Zhijie.
"Headquarters will still need to audit everything," Yang Wendong said. "Deals this big have to follow procedure."
"Understood. I'll prepare all the documentation," Zheng Zhijie replied.
Group audits were conducted annually. In the past, reviewing Changxing Real Estate was straightforward. Most capital was tied up in properties. Auditors only needed to check transaction records, title deeds, and occasionally visit sites to cross-reference with government data. Falsifying records was almost impossible.
But now that everything was being converted to cash, a more detailed audit was necessary—as it would be in any company.
Yang Wendong said, "As planned, next year we'll be pulling out of Hong Kong's property market. Pause all operations and prepare to shift to Singapore. Scout investment opportunities there."
"Singapore?" Zheng Zhijie asked. "Will we be developing real estate, or just acquiring?"
"Start with acquisitions. Development would involve too many local power players—we don't need that hassle," Yang Wendong replied.
Developing meant building homes and selling them, which generated local currency fast. But that could strain a country's foreign exchange reserves, and often governments blocked such moves. Acquisitions—buying and holding malls, offices, or hotels—were much more welcomed.
In his previous life, mainland China had similar policies toward Hong Kong and foreign investors. You could build an office tower, but not residential projects. Only a few exceptions, like Li Ka-shing, were allowed—and they left behind messes later.
Going forward, whether in foreign or local markets, Yang Wendong's focus would be holding assets: collecting rent and enjoying stable returns—not chasing short-term profits.
"Got it. I'll send people to Singapore this month to survey the property market," Zheng Zhijie said.
"Good. Changxing Film will also be investing there," Yang Wendong said, and proceeded to explain the plan to acquire a Southeast Asian theater chain.
After listening carefully, Zheng Zhijie said, "That's a great investment. Just like when we built cinemas in Hong Kong—the locations are usually excellent.
In the short term, the theater can generate income. Long-term, we can demolish and rebuild high-rises, keeping two floors for a theater and using the rest for malls, hotels, or offices."
"Exactly," Yang Wendong nodded. "Cinemas and supermarkets are the best land banking tools."
Any halfway responsible government had urban plans—they wouldn't allow developers to buy up prime land and leave it idle.
For capitalists, building a tower was a huge expense. But constructing a cinema or a supermarket was easy. These businesses could be highly profitable on their own, required only one or two floors, and fulfilled local needs. Triple win.
"Should we invest in supermarkets too?" Zheng Zhijie asked. "Since the theaters are being acquired, I can use my funds to buy land for supermarkets."
"That's a valid idea," Yang Wendong said. "But not right now. Just survey the market. The UK, US, Malaysia, and Singapore are all entangled politically right now. Let's wait until that's cleared up."
Even with knowledge of the future, he wouldn't rush in. If he disrupted British plans, his factory investment in London might be wasted—or worse, he could end up blacklisted. That wouldn't be worth it.
Only after Singapore's independence and political stabilization would the timing be right.
"Understood. We'll consider the political risks," Zheng Zhijie replied.
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