C-Suite Q&A
After two decades in the finance industry Derek Cheung felt the fallout of the 2009 financial crisis, eventually ending up in the reit business, where he sees strong growth potential in China
In an age of overt government intervention in the finance industry post-global financial crisis, Derek Cheung Yat-ming found it difficult for an individual to work in the fund management business. After spending two years trying to establish a private equity fund, he left the finance industry - where he had spent more than two decades.
In 2013, he joined New Century Asset Management, the manager of New Century Real Estate Investment Trust, as chief executive, finding that the nature of the work was similar.
New Century Reit is the first listed China hotel reit in the world. Major unit holders are New Century Group, the largest privately owned hotel group in China, and The Carlyle Group, a global alternative asset manager with US$189 billion in assets under management.
"Reit is similar to a private equity fund," said Cheung, adding that both involve buying properties at a low price and selling them at the highs to reap profits and pay dividends to holders.
As part of the reit market in Asia, Cheung casts his long-term hopes on the outlook of the market on the mainland, even though no reit product has been launched there so far.
He urged Beijing to streamline the tax regime to let the investment vehicle take off.