As the Festival City mania dies down – though there’s a five-day weekend ahead to reignite it – Cheung Kong chairman Li Ka-shing announces a 53% jump in profit for 2009 (from a low base in 2008). This doesn’t include any of the billions currently rolling in from Celestial Heights phase 2, La Mer, Le Prestige, Le Prime or La Tai Wai Panoramic Route 8 Vista, so the company has more to look forward to.
Although he doesn’t exactly put it this way, Li seems to doubt whether his own customers are doing the right thing in buying property right now. All he knows, we can surmise, is that it is a good time to sell.
For a further idea of how much Festival City represents value for money, I am grateful to Mr Webb for pointing out that the development rests on an enormous podium directly above the MTR’s maintenance facility, using the air rights on the public-sector rail operator’s land. The title deeds to my Soho slum say I am the proud owner of one 24th of Inland Lot No 123ABC; my own little patch – on an 1870s, 999-year lease – of God’s good earth. The buyers lining up at Tai Wai will have title to the cube of sky encased in their concrete box, and nothing else.
So is Cheung Kong Holdings, stock code 1, a good investment? Li himself is buying, so it could well be. However, readers of Alice Poon’s Land and the Ruling Class in Hong Kong will recall that among the array of tricks developers employ to extract maximum wealth out of the Hong Kong economy is the awarding of construction and materials contracts to their own privately held companies, whose earnings don’t have to be shared with riffraff investing in their publicly listed vehicles. Profit can therefore leak into family pockets before having a chance to appear on the bottom line at a press conference. Still, for investors into medium-term range trading, Hong Kong property stocks are reliable yo-yos.
Li doesn’t want to discuss rebellious number-two son Richard’s trouble in Beijing. The boy seems to have been punished for overly enthusiastic land speculation, though Daddy suggests it might be something else altogether. (And if they took action against everybody doing it, would there be anyone left?) Richard has run into problems with the Mainland authorities before, when trying to sell PCCW’s fixed-line network to evil foreigners planning to eavesdrop on China’s most precious state secrets. Possibly as a reaction, he started palling around with Hong Kong’s pro-democracy Civic Party, even advertising in/subsidizing their government-critical newspaper – a blatant breach of the patriotic united front’s ban on trading with the enemy. The Civic Party, along with the radical League of Social Democrats, are behind the unconstitutional by-elections currently being organized by the government and which won’t count as a referendum. Maybe that’s what Daddy was getting at. But then again, probably not.
The Civic Party came in for a roasting last night at the 2009 Leader of the Year Awards Ceremony – the Hong Kong tycoon-bureaucrat oligarchy’s Woodstock, if that isn’t too mind-boggling an image. Speaking to the assembled establishment ranks, tobacco tycoon and event sponsor Charles Ho saw fit to joke that the unlikely alliance of CP ladies and LSD “wolves” was due to lust. Not content with that, he then had his Sing Tao Group newspapers publish his wit for all to enjoy. It is the done thing on these occasions never to mention the dissidents and malcontents baying at the gates outside. They are too inconsequential (actually, baleful) to be worthy of a moment’s thought or breath. So if this was an attempt by Ho to score brownie points it was a failure, not to say something of an embarrassment to his audience.
The CP-LSD contribution to the fight against the parasites that run this city – the by-election/referendum publicity stunt – is pitiful and lame. But what about their moderate pro-democratic colleagues’ efforts? They have become so bogged down in the political reform public consultation charade that they are now, in effect, calling for the functional constituencies that bolster tycoons’ political influence to continue for another 10 years. With opponents like that, the Hong Kong government must think, who needs a broad support base?
One thing puzzles me: How does Li Ka-shing, sitting before the media and surveying the gargantuan profits yielded by the horrid apartments courtesy of a supportive government and acquiescent opposition, stop himself from laughing out loud? I would say he deserves a medal, but of course he’s got one.