HK tycoon's children won't inherit fortune

Mr Alex Shih, 30, began running Centaline Group, which handles two out of every five property transactions in Hong Kong, when he was named vice-chairman at the start of the year. "My friends who are working in finance are making more money than I do,
Mr Alex Shih, 30, began running Centaline Group, which handles two out of every five property transactions in Hong Kong, when he was named vice-chairman at the start of the year. "My friends who are working in finance are making more money than I do," he said. The younger Mr Shih is set to become chairman when his 70-year-old father retires.PHOTO: BLOOMBERG

Mogul donates millions to charity; heir to biggest HK real estate agency still saving for first home

HONG KONG • The heir to the biggest real estate agency in property-mad Hong Kong does not own a house.

Not only that, he will not inherit his father's stake in Centaline Group - estimated to be worth about US$400 million (S$543 million), according to the Bloomberg Billionaires Index - because it was donated to charity more than a decade ago.

But Mr Alex Shih is not perturbed, even though he is missing out on the wealth which the offspring of some Hong Kong tycoons are taking control of, along with their families' businesses.

Mr Li Ka-shing, the city's richest man, last year handed the reins to son Victor, while billionaire Lee Shau Kee last month said he was considering retiring from Henderson Land Development and putting his two sons in charge.

"I personally accept it,'' Mr Shih, 30, said of his father's decision not to pass on the family fortune to his three children.

"He told us when we were very young and we didn't have a choice. He would say that it's better not to lead a life that's too comfortable in one go. You'll treasure it more if you gain things step by step."

Mr Shih took over running Centaline, which handles two out of every five property transactions in Hong Kong, when he was named vice-chairman at the start of this year. He is set to become chairman when his 70-year-old father Shih Wing Ching retires, which he expects to happen sometime soon.

The younger Mr Shih rose to the top job after a difficult year for Centaline, which was founded in 1978. Commission revenue inched up just 1 per cent to about HK$19 billion (S$3.3 billion) last year, and net income slumped 52 per cent to HK$501 million, as a downturn in Hong Kong's property market and growing competition in mainland China took its toll.

Hong Kong's property market has since rebounded, and Mr Shih is looking to modernise the agency. He oversaw the introduction of virtual-reality house viewing in 2017, and more recently a blockchain platform to streamline sales and rental agreements.

"The company is like a big ship... I am trying to provide new technology tools to make it move faster."

While the firm handles millions of dollars of transactions a day, the soft-spoken Mr Shih said he earns only a regular salary.

The foundation to which his father donated the Centaline stake aims to alleviate poverty in rural China, from building infrastructure to supporting under-privileged children's education.

"My friends who are working in finance are making more money than I do," he said.

FENDING FOR YOURSELF

I personally accept it... He told us when we were very young and we didn't have a choice. He would say that it's better not to lead a life that's too comfortable in one go. You'll treasure it more if you gain things step by step.

MR ALEX SHIH, on his father's philosophy behind donating his wealth to charity.

A graduate of the London School of Economics and Political Science, Mr Shih said he considers himself an average Hong Konger. His office is small and sparsely decorated, and he enjoys hiking and playing badminton - hardly the pursuits of the billionaire set.

His modest upbringing has also helped keep him humble. His father eschewed the elite international schools favoured by Hong Kong's wealthy and enrolled his children in local government-subsidised schools; from an early age, he instilled in them the philosophy that money should be used to help the less fortunate.

Mr Shih even worked as a real estate agent when he first joined the family business. "It was quite tough - staying outdoors to compete with other agents for limited customers, rain or shine."

Like many other millennials in a city ranked the world's least-affordable for the past nine years, he is still saving for his first house.

Mr Shih's advice to his peers? Be realistic.

He aims to buy a two-bedroom flat in a middle-class neighbourhood in West Kowloon, or the slightly more upmarket Ho Man Tin if his parents chip in, citing both areas' good public transport links and potential for price growth - a far cry from the multimillion-dollar mansions his agency sells.

"The first home may not be the one you want the most. But at least you get on the property ladder and then you slowly climb up."

BLOOMBERG

A version of this article appeared in the print edition of The Straits Times on April 24, 2019, with the headline 'HK tycoon's children won't inherit fortune'. Print Edition | Subscribe

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