Chapter 557 Ending
"Yuan Chao, why do I feel like the atmosphere of this auction is a little off?
The bidding for many plots of land seems to be very intense, but why do the prices achieved at auction seem to be far lower than everyone's expectations? "
Wang Yuanchao put his arm around Liu Qianqian's shoulders, sighed and said, "Hey, Chinese businessmen in Hong Kong have been dealing with the white people from the pirate countries for so long, and they already know how to deal with the white people cutting leeks.
Those who can build such a large industry are all smart people.
The Hong Kong government has made it clear that it wants to use the land to reap everyone’s wealth. Everyone also hopes to make money through real estate, but this does not mean that everyone will fight to the death and be reaped at will by the Hong Kong government.”
"Over the years, many of Hong Kong's richest people have made their fortunes in real estate.
Except for some foreign companies, almost all of Hong Kong's real estate industry has been monopolized by the Chaoshan Chamber of Commerce and the four major comprador families. It is difficult for other businessmen and companies to enter this industry and compete with them.
Just like the land auction this time, they will let everyone fight for some marginal land and will not block everyone's way.
As for the land in some prosperous places, these companies and families have already held internal meetings and selected them.
They would raise the land price internally to a price acceptable to the Hong Kong government, and then make the deal. That was all for show, and they would not compete with each other at all.
As for the land that everyone has allocated and that we outsiders like, if we bid for it, they will use all kinds of means and pressure to force us to give up. Therefore, the game of Hong Kong real estate wealth has always been in their hands, and it is difficult for outsiders to intervene. "
"Ah?, aid to Korea,
We just auctioned four plots of land in Barker Road, Victoria Peak and Deep Water Bay.
Why didn’t they bid against us?”
Wang Yuanchao smiled and said:
"We can only build one luxury house on each of the four plots of land we bought. The land is too small.
Compared to other land developments, the economic value is not high, and these families have no shortage of luxury homes in Taipingshan and Deep Water Bay. They are all mature businessmen with no economic interests and no hatred. What is the point of them fighting with us?"
"Ah? So, if there is not much economic benefit, then why do we spend so much money to buy these plots of land?"
Wang Yuanchao smiled inexplicably and said:
"Hey, this is where everyone's perspective is different.
These real estate development companies and wealthy families, in the real estate business, pursue high capital turnover, pursue rapid land acquisition, rapid construction, use of bank funds for investment, and rapid sales and capital recovery. Therefore, the better the location of the land and the larger the area, the more money they can make. Therefore, their requirements for land are very high.
They don't look down on ordinary land and will give it to other people and companies participating in the land auction, and pick up some scraps to take home.
But we are different. We have premium rice, a stable, scarce, and inherently monopolistic product, which provides a stable source of funds for our company. So our company is not short of money. However, we cannot just leave the money we earn in the bank, because the interest rate of the bank cannot keep up with inflation and currency depreciation.
If we keep our hard-earned money in the bank, we are actually losing money every day.
So we need to continue to invest the money we earn and use it to make money, which is in our interest.”
Wang Yuanchao raised his head, looked around at the excited and crazy figures at the land auction, and then continued:
"In Hong Kong, a place with a developed economy and a large population and limited land,
Is there any other investment that would make more money than investing in real estate or the property market?
Land and houses are important resources that are indispensable for economic development.
Moreover, the land in prime locations is irreplaceable. If one piece is sold, there will be one less piece. Therefore, for us, holding real estate properties in prime locations is very important.
By holding these properties, you can use them to enjoy the benefits of social economic development.
By taking advantage of the scarcity of land and properties in prime locations, we can enjoy the spillover value of the appreciation of land and properties during the process of social and economic development. By then, the scarce properties we hold will passively enjoy the dividends of Hong Kong's economic development.
In this way, the faster Hong Kong's economy develops in the future, the faster the land and property market rises, the faster our assets and net worth will rise.
The speed at which this asset appreciates is far from comparable to the value of keeping money in a bank.
To put it bluntly, the four luxury residential plots we bought today, after we spend money to build the houses, we don’t have to do anything in the future. In 20 to 30 years, these four luxury houses can easily bring us tens of billions of Hong Kong dollars. Do you believe it?"
Liu Qianqian's eyes widened. She simply couldn't believe what Wang Yuanchao said, but it was not easy to argue with Wang Yuanchao in such a public place, so she could only perfunctorily respond: "Well, Yuanchao, I believe you."
This impetuous answer made the atmosphere between the two of them quite awkward for a moment, and there was no point in continuing the conversation.
As the host shouted: "Ladies and gentlemen,
The following plot of land is No. 888, Tsim Sha Tsui, located opposite Harbour City in Tsim Sha Tsui. The reserve price is HK$50 million, and the starting price is no less than HK$100,000. Friends who are interested, please start bidding now. "
Wang Yuanchao didn't bother to worry about the auction strategy after he saw the land he liked was finally put up for auction. His company had prepared a budget of 230 million yuan for the auction, and he had 800 million Hong Kong dollars in his personal account at a Swiss bank.
I just bought the land at Barker Road in Victoria Peak and Deep Water Bay for less than 20 million Hong Kong dollars. The market value of this land is only about 200 million Hong Kong dollars.
Once the price exceeds this, not counting the effect of land price appreciation, these families and real estate developers will simply lose money and make no money.
So in order to avoid being drawn into a protracted bidding war, Wang Yuanchao decided to show his determination to take over the land. He listened to the bidding at the venue.
"Cheung Kong Holdings offered 60 million."
"Hang Seng Properties offered $65 million."
"New World offered 68 million."
Wang Yuanchao suddenly stood up and shouted regardless:
"Xiangjiang Group offered 200 million yuan."
As Wang Yuanchao's bidding voice echoed in the meeting room, the entire venue fell silent for a moment.
Then a chaotic voice sounded in the venue, "hiss~"
"Oh my god, is Xiangjiang Group crazy? They bid 200 million for this piece of land?"
"Damn, are you kidding me? This piece of land is not worth 200 million, okay?"
(End of this chapter)
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