Ho Bee's recurring income strategy reaping dividends

THE most noteworthy feature of Ho Bee Land's financial results for the year ended Dec 31, 2015, is the surge in rental income, which attests to the group's success in building a business model with a strong base of recurring income.

The group used to be a very different animal. Ho Bee Investment, as it used to be called, was a stockmarket darling in 2006-2010 when it reaped bumper profits from developing homes in the waterfront residential enclave of Sentosa Cove.

Since the 2008 Global Financial Crisis (GFC), foreign buying - which had propped up the high-end residential market prior to the crisis - has not returned in a big way. GFC also caused Ho Bee's top brass to rethink the group's strategy of relying almost entirely on property development, a model based on rapid recycling of capital through pre-sales of homes.