At 82, mogul Kwek Leng Beng still offers lessons for the young

NUMEROUS dignitaries gathered at the ballroom of The St Regis Singapore on the evening of Nov 9. There were heart-warming speeches, lovely canapes, champagne and wine.

The occasion was the launch of Strictly Business: The Kwek Leng Beng Story, a 257-page biography written by Peh Shing Huei on the executive chairman of Hong Leong Group Singapore and City Developments Limited (CDL).

A highlight of the event was the announcement of an endowed gift of S$24 million, jointly made by Kwek Leng Beng and CDL, to the Singapore Institute of Technology (SIT). With a matching government grant, the total endowment contribution amounts to S$60 million.

SIT will name its tower, which houses the academic and administrative staff offices in its future campus in Punggol, the Kwek Leng Beng University Tower.

However, should Kwek have made his gift anonymously, and should SIT have named a major building after him?

Kwek’s father Kwek Hong Png arrived in Singapore in 1928 as a poor migrant from China’s Fujian province. Hong Leong traces its roots to Hong Png setting up his own company to trade in building materials in 1941. 

Shortly after Hong Png started his new business, Japanese troops marched into Singapore in February 1942. Still, his business thrived in the war years and thereafter. Certainly, it is awe-inspiring how the self-made tycoon overcame huge odds through grit and determination.

Born in 1941, the younger Kwek spent much of his early years growing up in comfort in a bungalow sitting on 25,000 square feet of land along Buckley Road in the Newton area. 

He started working for the family business that his father started in 1963 and has led Hong Leong since 1990. Leng Beng admires his father and credits the latter’s harsh tutelage for shaping his own business acumen. 

Business track record

Leng Beng’s not Hong Leong’s founder, and his business track record is imperfect. CDL could be stronger today by being big in property asset classes such as data centres or modern warehouses. CDL could have done better from China’s booming property sector over the 1990s and early 2000s, or in real estate fund management.

Also, CDL’s shares suffer from undervaluation – trading at around one-third of its revalued net asset value per share as at end-June of S$18.97, if fair-value gains on investment properties and revaluation surpluses of the hotel portfolio were included. 

Still, Leng Beng has achieved some major business triumphs. He was instrumental in his family’s entry into CDL and subsequent acquisition of a majority stake in it. He helped build Hong Leong Finance into Singapore’s largest finance company with his hands-on approach and relentless focus on acquiring customers.

On the property front, Leng Beng showed that a residential project in Singapore’s Central Business District could work, with CDL’s successful launch of the 1,111-unit The Sail in Marina Bay in 2004. Demand for this project signposted an upturn in Singapore’s private housing market, which had been languishing for seven years.

Leng Beng played a key role in Las Vegas Sands’ securing the integrated resort at Marina Bay and in the design of the iconic Marina Bay Sands.  

Arguably, his biggest achievement lies in building a hospitality business, as well as growing Hong Leong and CDL well beyond Singapore.

He made major hotel purchases in London, New Zealand and New York in the early 1990s. In 1995, he grabbed global headlines when he partnered Prince Alwaleed bin Talal to buy the trophy Plaza Hotel in New York from Donald Trump.

In the 1990s, Leng Beng bought the 16-hotel Copthorne chain in Europe from troubled Irish airline Aer Lingus and the Regal chain of 47 hotels in the US. He acquired the Seoul Hilton in South Korea from Daewoo in 1999, after the Asian Financial Crisis, and would eventually net a profit of about US$400 million when the rebranded Millennium Hilton Seoul was sold for US$845 million in 2021, in possibly his most lucrative project.

Leng Beng’s business empire building offers many lessons. Avoid being over-leveraged, and one can buy assets from troubled owners in times of crisis. Manage costs well, but zealously focus on generating income. 

Grow business in areas where one is familiar with. Build a good reputation to win the trust of customers and suppliers for long-term success. Be disciplined in acquisitions, pay attention to details and know a target’s local market well. The above are among many useful tips to be gleaned from reading about his business activities.

Inspiring the young

With success, came wealth for Leng Beng and his family, who consistently rank among the top in lists of Singapore’s richest people over many years.

However, is a tycoon who has much wealth tied to the rent-seeking activity of owning investment properties a good role model to the young?

Perhaps, Leng Beng’s life encapsulates timeless values that can inspire the young at SIT and the wider Singapore.

He works hard, with business being his passion. Whatever the market conditions or one’s circumstances, working passionately and working extra hours can likely make one better at what one does. Even as artificial intelligence grows more powerful, hard work and passion are non-negotiable in turning dreams into reality.

Moreover, the tycoon embraces risk, is decisive and deals with setbacks pragmatically. In early 2021, CDL announced the writing off of almost all of its S$1.8 billion investment in Chinese group Sincere Property Group.

CDL’s transformational investment in Sincere was meant to significantly grow its China presence. Instead, troubles at Sincere inflicted reputational and financial damage as well as created discord within the Kwek family. Nonetheless, in confronting a major setback, Leng Beng was practical, did not dwell on the loss and moved on.

Where his story may resonate most is to encourage young persons to consider starting businesses.

With a healthy job market here, many talented and well-educated young Singaporeans will sensibly pursue careers in professional services, multinational groups, financial institutions, the public service or large local corporations.   

However, Singapore needs dynamic business persons who fearlessly tackle new sectors and geographies. Successful business people contribute greatly by creating good jobs. 

Even at 82, Kwek Leng Beng will likely not rest on his laurels and may be far from done in deal making.