Far East Consortium to reinvent itself as regional player to maximise investment opportunities

Far East Consortium International is reinventing itself into a regional player so it can maximise investment opportunities by taking advantage of different property cycles in different markets, says managing director Chris Hoong Cheong Thard.

"Location and timing are equally important for a successful property investment," Hoong said. "It will give us less flexibility in capturing upside potential if we just focus on a single market."

He said some developers in China had been forced to join the bidding wars to acquire development sites at unbelievably high prices as China was their only investment market.

The business model of Far East Consortium is likened to CapitaLand, which built up a land bank in different markets.

"We have extended our reach to London, beyond our established footprint in Hong Kong, Australia, Malaysia, Singapore, Shanghai and Guangzhou," Hoong said.

"We will have more acquisition opportunities and this strategy has resulted in a relatively low land-cost base."

In July, the medium-sized developer teamed up with Chow Tai Fook Enterprises and Australian casino operator Echo Entertainment Group to win the contract to develop a mixed-use mega development in Australia's Queensland state with an estimated investment of A$2 billion (HK$10.87 billion).

Hoong rejected suggestions the large investment could soak up all the company's cash, saying the project would be developed in phases, with scheduled completion in 2020.

"We will also benefit from the depreciation of the Australian dollar, which means costs will be less when translated into Hong Kong dollars," he said.

The Australian dollar hit a six-year low against US dollar in the first week of this month. The Hong Kong dollar is pegged to the greenback.

The project will consist of three residential towers comprising about 2,000 units, five world-class hotels, food and commercial outlets and a casino in Brisbane's prime waterfront district.

Far East Consortium and Chow Tai Fook will each hold a 25 per cent interest in the resort component - excluding residential - while Echo Entertainment will own the remaining 50 per cent and operate the casino.

The development of the residential towers will be undertaken by Far East Consortium and Chow Tai Fook on an equal basis.

To minimise currency risks, Far East Consortium reinvests its cash generated from overseas projects domestically. "It will be the same for this Australian property project," Hoong said.

In C-Suite, Hoong tells more about the company's investments