A century-old wealthy family that rose from Shanghai

“Boss, this is the plot of land. The original owner asked for HK$7 per square foot, with a total area of ​​15.2 square feet. I think if we develop a five-story apartment building, there will be a lot of rental space.”

At the seaside location in North Point, Yan Kuan introduced the area to Chen Guangliang.

Chen Guangliang listened and thought at the same time.

This plot of land on King's Road, near Fortress Hill and the North Point Power Station, is closer to the city center than other plots in North Point, making it undoubtedly more suitable for developing apartments and renting them out to wealthy mainlanders seeking refuge in Hong Kong.

Recently, Cheung Kong Properties has been buying up large amounts of dilapidated properties and land in the Sai Wan, Wan Chai, Causeway Bay, North Point, and Yau Tsim Mong districts, all for the purpose of building tenement buildings and apartments.

"Yes, it's suitable for building apartments, let's call it Haiguo Apartments."

Yan Kuan and others also had some doubts—what if the boss suddenly spent tens of millions of Hong Kong dollars to invest in real estate and build so many apartments and residences, and no one rented them?
It's true that many people in Hong Kong are homeless right now, but those are the poor. Even if they had houses, we wouldn't give them to them for free.

However, because the boss's predictions of the situation were always accurate, they never raised any objections, and besides, objections would have been futile anyway.

“Yes, the residential style in Sai Wan and Sheung Wan is Cantonese-style arcade buildings, so when we buy land and old buildings, we build buildings in the same style; Wan Chai, Causeway Bay and North Point are suitable for building apartments; and Kowloon areas such as Yau Tsim Mong are more like tenement buildings.”

Chen Guangliang naturally knew these things as well. He was also quite knowledgeable about Hong Kong real estate. Building inspections were not strict at that time, but the regulations stipulated that buildings could not exceed five stories.

"In terms of architecture, you need to come up with new designs that meet people's growing demand for quality of life, focusing on both quality and efficiency."

“Okay, we not only recruit construction talent from Shanghai, but also local talent to join us. Now the company has more than 40 people, and we have regained the momentum of our former leadership in the Shanghai real estate market.”

Chen Guangliang patted Yan Kuan on the shoulder, a gesture reminiscing about the past glory of the real estate industry.

This time, he needs to purchase land that can support at least 700 buildings, which is equivalent to at least 100 million square feet. The land cost alone will require an investment of more than HK$1000 million, or more than US$250 million.

There are also construction costs. The reconstruction and maintenance of just the first 300-plus tenement buildings alone will require HK$200 million. The construction cost of the remaining 700 buildings (how many buildings are equivalent to apartments) will probably be at least HK$1400 million, or US$350 million.

Of course, these funds were invested gradually, partly through a "rent-to-build" model, and the construction portion was part of a plan that continued until 1950.

However, once this goal is achieved, Chan Kwong-leung will be Hong Kong's "Rental King," which he already is. At that time, Cheung Kong Property alone will be able to provide 5000 floors, accommodating approximately 30,000 to 40,000 people.

"We aim to build a number of residential properties next year."

"No problem, at least 800 houses can be built next year."

"Um"

In fact, although Yangtze River Real Estate focuses on quality, it only requires that building materials have a 30-year shelf life.

This is something that everyone is a little confused about. Only Chen Guangliang knows that in ten years, when the building height limit is lifted, these houses will have to be demolished one after another and replaced with high-rise buildings.

With the foundation Chen Guangliang has laid, he can basically adopt strategies such as "renting out 50% and selling 50%" and "holding back the land" in the future, because his financial resources are too strong.

At the end of the month, the first batch of 2000 ballpoint pens went on sale in department stores in Hong Kong and Shanghai.

Prior to this, Global Trade had already obtained the Far East distribution rights for American ballpoint pens, which meant that department stores like Wing On and Sincere, as well as other stores, would no longer be able to stock the same brand of ballpoint pens.

Wing On Department Store was still operating during the Japanese occupation, which is why some members of the Kwok family were arrested and imprisoned, eventually fleeing overseas.

As for Hong Kong's handling of the trials of "Japanese collaborators," it was very lenient. Those Chinese who were coerced by Japan but did not harm ordinary people were generally not prosecuted. This was because the Hong Kong government's reasoning was that during the Japanese occupation, many Chinese were forced to become Japanese "officials" in order to "maintain the lives and order of the Chinese community."

For example, after the Japanese army occupied Hong Kong, they adopted a strategy of "using Chinese to control Chinese," appeasing the Chinese leaders who remained in Hong Kong to stabilize public sentiment. As a Chinese leader, Zhou Shoushen had no other choice but to, along with Luo Xuhe, Luo Wenjin, Deng Zhaojian, and others, establish the "Hong Kong Post-War Settlement Committee" under Japanese instructions to handle issues such as food and security. Today, the Hong Kong government has not pursued any responsibility and continues to trust Zhou Shoushen to serve in office.

West of Des Voeux Road, Wing On Shopping Mall.

A ballpoint pen salesman is demonstrating to everyone.

"This is the first pen that can write underwater. The ballpoint pen uses a small ball to release highly concentrated gelatin-based ink onto the paper for easy writing anytime, anywhere."

"The high-tech product that the United States produced this year is named after the atomic bomb that bombed Japan, so it is called an atomic pen."

Obviously, there is an element of fabrication involved. The Americans did not name it 'Atomic Pen', nor did they intend to name it after the atomic bomb.

But this statement immediately piqued the interest of the Chinese elites.

How much is one?

“HK$320 is a bit pricey, but it’s definitely worth it because it’s also a symbol of status.”

I'll buy one.

They didn't need to put in much effort to promote them; American products of this era were basically bestsellers.

So in a very short time, the ballpoint pen became a bestseller in Hong Kong and Shanghai. Seeing the situation, Global Trade immediately ordered a second batch.

It was a collaboration with Jack, but Jack was only responsible for purchasing in the United States and shipping from US ports. He earned $4 per bottle, while the purchase price was $8.5 (the US retail price was $10).

Even after deducting shipping costs and retailer profits, Global Trade still makes at least $40 in profit on each 'ballpoint pen'.

Exorbitant profits!

The instant success of Global Trade has also attracted the attention of Hong Kong's trade community.

However, foreign firms like Jardine Matheson and Swire didn't pay much attention to these small commodities; on the contrary, Chinese-owned firms like Li & Fung and Dah Chong Hong were very interested.

Li & Fung, founded in 1906, was the first Chinese-owned trading company in China to engage in foreign trade. Its founders were Fung Pak-liu and Li Daoming, with Fung holding a 51% stake. Initially, Li & Fung's products were mainly sold to the United States. This was because Fung met an American who then consistently purchased Chinese goods from Li & Fung, including firecrackers, fireworks, bamboo ware, and rattan ware.

On the eve of the War of Resistance against Japan, feeling the changing situation, Feng sent his three sons from Guangzhou to Hong Kong to establish a branch of Li & Fung at 9 Queen's Road. Subsequently, he purchased the first property for Li & Fung in Hong Kong – 18-20 Connaught Road.

Today, all of Li & Fung's shares are in the hands of the Fung family, which has now entered its second generation, with brothers Fung Mo-ying and Fung Hon-chu serving as chairmen.

18-20 Connaught Road, Li & Fung.

Feng Hanzhu asked in surprise, "Brother, do you know the profit margin of this ballpoint pen?"

Feng Muying said, "The profit margin should be very high, after all, it sells for HK$320 a bottle. So, Lao San, what exactly is its cost?"

The third brother was in charge of overseas operations, while he was in charge of mainland China. Hong Kong was naturally handled by both of them, working together to manage Li & Fung.

Feng Hanzhu said, "The retail price in the United States is only US$10, which is HK$40. Global Trade can earn at least HK$120 per bottle."

Feng Muying was shocked; this was incredibly profitable.

He couldn't help but exclaim, "If we had this ballpoint pen trade, that alone would have been enough to take our Li & Fung Group to the next level."

Feng Hanzhu said disappointedly, "I have consulted with the American side, and an American has already secured the agency rights for 'Reno' brand ballpoint pens in the Far East. It seems to be a partner of Global Trading. And currently, only Reno can produce this product."

Feng Muying was greatly disappointed; she had no chance at all.

He said, "It's such a pity." Compared to the deep pockets of Worldwide Shipping (backed by banks), it would have been a significant milestone for Li & Fung if they had been able to become the distributor of this product.

Unfortunately, they were too late.

On this day, Lin Bingyan, He Shanheng, Liang Zhiwei, Sheng Chunlin, Liang Qiuju, He Tian and others gathered in the conference room of Hang Seng Bank.

After the war, they returned to Hong Kong from Macau immediately to reorganize their banking business.

Leung Kau-kui spoke first: "The reason we invited everyone here today is to discuss whether we should set up another trading company, given the recent surge in sales of ballpoint pens in Hong Kong and the instant success of Global Trading."

Born into a family of bankers, after joining Hang Seng Bank, he was stationed in Guangzhou Bay. Using his years of experience in running a bank, he allocated funds to support the development of "Hang Seng Bank (also a trading company established by Hang Seng's founders)". He transported seafood, rice, sugar, timber, medicinal herbs and industrial products from the south to the north and southwest, and transported local specialties such as soybeans and medicinal herbs from the north to the south, and exported them to Southeast Asia and North America.

Banks and trading companies are a perfect match.

Ho Sin-hang immediately said, “I have the same idea, even without seeing how well ballpoint pens are selling. European and American countries are eager to trade with China, Hong Kong’s geographical location is very important, and Hong Kong is short of supplies. I suggest that we start to rely on Hong Kong and set up another trading company.”

Leung Chik Wai-yip said, “Indeed, based on our years of experience, Hong Kong will definitely become an important international trade and transportation hub in the future, because the concessions in Shanghai are gone, and its advantages in all aspects are also gone.”

Everyone agreed to establish a trading company, since they had done it before.

The eldest brother, Lin Bingyan, said, "In that case, Shanheng will serve as chairman, Zhiwei as vice chairman, and Qiuju as managing director. Everyone will concurrently hold positions at Hang Seng Bank and the trading company."

He was older than the others and didn't have enough energy.

In fact, Lin Bingyan was He Shanheng's 'mentor'.

Then, people inevitably started talking about global trade, after all, it is an indispensable representative of trade.

Liang Zhiwei said, "Global Trade has the word 'global' in its name, and they do have some strength. They have shipping, banking, and trading companies, and their boss, Chen Guangliang, is a leader among Chinese businessmen. I just don't know why they attach so much importance to Hong Kong?"

After thinking for a moment, Ho Sin-hang said, “Hong Kong has a large Cantonese population, which gives us an advantage in doing business. Everyone does their own thing, and in the end, we will definitely be the winners. Just like how Cantonese businessmen in Shanghai can never compete with Shanghai businessmen. There are various factors at play, so as long as we work hard, we will definitely achieve success.”

“Alright, Shanheng is right, let’s all do our best.” The eldest brother, Lin Bingyan, said, “In addition, our Hang Seng Bank needs to exert greater influence in the Hong Kong Gold and Silver Exchange. I have a feeling that with the instability of the mainland currency, many people will transfer their assets to Hong Kong, which will make gold very important.”

Ho Sin Hang was undoubtedly his most trusted 'disciple', and his abilities were also the best among them. Therefore, the key figure in Hang Seng Bank, Lam Ping Yan, strongly supported Ho Sin Hang.

He Shanheng, knowing the importance of gold, said, "Alright."

The businesses of silver shops and banks are like traditional, unregulated businesses and modern, legitimate businesses. Silver shops can directly participate in gold and foreign exchange speculation, while banks can only circumvent these restrictions through other means.

On the other hand, Chen Guangliang was also quite pleased to learn that the 'ballpoint pen' was selling well in Shanghai and Hong Kong.

Although this deal won't make much money, at least not for a tycoon like Chen Guangliang with a net worth of nearly HK$200 million, it represents a smooth initial development for Global Trading Company and a good start.

Moreover, having secured this business, it's possible to earn HK$100 million, which would be equivalent to doubling Global Trade's assets.

At the same time, with such a successful case, all employees of Global Trade became more confident and serious in their work. Next, branches were established one by one, and various goods began to flow over long distances.

this day.

Jiang Meiying's $5 million finally ended up in Ping An Bank's account in Hong Kong. This is equivalent to Chen Guangliang gradually transferring $8 million to Hong Kong, totaling HK$32 million, starting in mid-August.

Even Jardine Matheson and Swire may not have such financial strength, since much of their assets are fixed assets.

The funds are primarily intended for investment in Hong Kong's real estate and shipping sectors, and are clearly not something that can be used all at once.

Furthermore, some of these assets are gold, oceans, and silver, which cannot be used.

The reason Chen Guangliang kept some silver dollars was that they were mostly "Yuan Shikai silver dollars," which he intended to keep as souvenirs and for his collection.

He called Ye Ximing and Li Hongsheng to his office and said, "The funds I borrowed this time, Yangtze River Real Estate and Global Shipping can't spend much of them in a short time. Ping An Bank will set up Ping An Securities, but it won't be for stock trading. Instead, it will enter the gold exchange to absorb spot gold. In addition, there will be more gold coming to Hong Kong from the mainland later, so please help me exchange more US dollars for gold."

Assuming a shipping investment of $250 million, with $100 million coming from his brother, and the Liberty Cruises allowing for installment payments, this undoubtedly delays the outflow of funds; similarly, a real estate investment of $500 million would also be disbursed in installments.

Chen Guangliang's gold accumulation period can be traced back to before 1945-1947.

Ye Ximing asked, "Boss, how much exactly do you want to exchange, and how long do you plan to take?"

Chen Guangliang said, "Anyway, we don't want anyone to find out that we are absorbing assets on a large scale. It can take two or three years, and the funding will depend on the situation. In short, you just need to report to me regularly."

Ye Ximing nodded and said, "I understand. Also, boss, since you've deposited so much US dollars or gold, can Ping An Bank increase the loan-to-deposit ratio? 100% for a 500 million deposit, 80% for a 1000 million deposit? There shouldn't be any risk!"

Since the boss's business in Hong Kong has great prospects, they lend a lot of money to factory owners. Moreover, with so many companies under the boss's control needing loans, they have no shortage of channels.

"Yes, that's fine. After all, we haven't attracted that many deposits yet. Hopefully, we can break through HK$1000 million next year!"

"no problem"

After the two left, Chen Guangliang fell into thought.

His purpose in acquiring gold was that he knew that due to the civil war, gold in Hong Kong would be driven up to astronomical prices, making it a completely separate zone from gold in the world.

Around 1947, the Hong Kong government began to control the import and export of gold. However, due to the influx of wealthy mainlanders into Hong Kong, especially the wave of speculators from Shanghai, they engaged in large-scale gold speculation, driving prices to very high levels.

The final result was that the Cantonese merchants won a great victory, while the Shanghai merchants suffered a great defeat.

This includes 'Little Hardoon' (whose appearance is described as Hardoon), who supposedly came to Hong Kong in his previous life to speculate on gold, but later went bankrupt. There were many such Shanghai businessmen who stumbled in the gold speculation market, which is why almost no Shanghai businessmen invested in banks afterward.

Are Cantonese businessmen the ones who win?
According to Chen Guangliang's understanding, Cantonese merchants used their local advantages to smuggle gold from South Africa and India, transiting through Macau to Hong Kong. Because gold was very cheap overseas and very expensive in Hong Kong, Cantonese merchants would take advantage of periods of high gold prices to settle accounts with physical gold. In this way, Cantonese merchants not only controlled the gold but also the market. When the war ended in 1950, gold prices collapsed, and countless Shanghai merchants went bankrupt.

What Chen Guangliang is doing now is storing a large amount of physical gold, so that he can cash out when someone drives up the price of gold in the future.

Based on the current gold price: 1 ounce (28.35 grams) = US$35 = HK$140.

One tael of gold in Hong Kong is 37.5 grams (the Shanghai standard is 31.5 grams), which means that one tael of gold in Hong Kong is worth about HK$190.

It's possible that gold in Hong Kong could rise to HK$600 this time, so even if the current cost is HK$200, there's still a huge profit to be made.

If Chen Guangliang hadn't rushed things and had gradually cashed out at the peak, completing the gold sales before September 1949, he would naturally have been the real winner. This move would have both disrupted the schemes of the Cantonese gold speculators and allowed him to seize the wealth of the Shanghai gold speculators.

It's always good to benefit our own people.

Chen Guangliang has never had a good impression of those speculators in the Shanghai stock market, so he felt no psychological pressure.

Moreover, this is a speculative market where there are no fellow villagers or friends.

In their previous lives, Cantonese gold speculators primarily relied on smuggling alliances to facilitate their own sales; their advantage lay in their familiarity with the local gold market and their ability to smuggle cheaper gold from overseas. (End of Chapter)