Chapter 321: Securing the Land King and Preparing for the Coming Crisis
The grand finale always comes last.
The auctioneer continued, "For this auction, the minimum bid increment is HK$500,000."
The representative from Hongkong Land, John Keswick, raised his paddle without hesitation. "HK$30 million."
"Wow~~"
The crowd stirred immediately. Hongkong Land had just raised the bid by a massive HK$2 million in one go.
Yang Wendong smiled. "They're trying to scare off the competition—give the undecided bidders a reason to step back."
"Exactly. It's also a public message: 'We're determined to get this land no matter what,'" Zheng Zhijie nodded.
Yang Wendong added, "But with a site this prime, there's no way everyone else will just give up."
Even knowing that a real estate crisis would strike in three years, Yang Wendong wouldn't walk away from a core Central district plot.
In the long run, the 1966–67 property downturn was just a blip.
For top-tier locations, from now until the early '90s, Yang Wendong wouldn't let go—no matter what kind of turbulence came in between.
"HK$30.5 million," called out the representative from Hang Seng Bank. Ho Sin Hang himself sat behind him, expressionless.
The Swire representative raised his paddle. "HK$31 million."
"HK$31.5 million," said the Hongkong Land team immediately, refusing to budge.
"HK$32 million."
The price climbed quickly to HK$34 million.
At that point, it became clear: each raise was smaller than the last. It was approaching most participants' psychological limit.
"HK$34 million—any other bids?" the auctioneer asked politely.
Technically, this was the point to start calling "Going once," but he was deliberately stalling. It was clear he'd been given silent approval to hold out, in hopes of pushing the price higher.
Yang Wendong raised his paddle. The auctioneer's eyes lit up.
"Bidder No. 16 bids HK$34.5 million."
If a bidder simply raised their paddle without speaking, they were assumed to be raising by the minimum increment.
Some reporters turned their attention to Yang Wendong.
"He didn't participate in any of the earlier rounds—clearly, he's here just for the land king."
"Well, obviously. Would someone like Yang Wendong show up if it wasn't for the headline property?"
The press whispered among themselves.
Yang Wendong's bid made Ho Sin Hang shift slightly. His representative raised his paddle again.
"HK$35 million," the auctioneer announced with renewed excitement.
Hongkong Land's people followed up instantly, again without quoting—clearly sticking to minimal increments.
"HK$35.5 million," the auctioneer called out, then turned to the Swire team.
Everyone in the hall held their breath. The Swire team, caught in the reporters' camera flashes, bowed their heads and whispered. After a moment, they fell silent and withdrew from the bidding.
The meaning was obvious.
The auctioneer looked to the others.
Hang Seng's representative hesitated, then raised his hand again.
"HK$36 million."
The auctioneer was visibly excited now. He turned back to Hongkong Land and Changxing Real Estate. Only these three remained.
The British group from Hongkong Land huddled briefly, then raised their paddle.
"HK$36.5 million."
The auctioneer looked again toward Hang Seng. Ho Sin Hang furrowed his brow, clearly deep in thought.
Yang Wendong raised his paddle. "HK$37.5 million."
A full HK$1 million raise.
"Looks like Yang Wendong is set on winning this. That's nearly HK$10 million over the opening bid."
"Ten million more! This land price is about to break the Central district record again!"
"Does Yang Wendong really have that much cash?"
"Didn't he just drop US$50 million on oil tankers?"
"Not the same—those ships were bought mostly on credit."
"Well, real estate uses leverage too, doesn't it?"
The crowd murmured again, buzzing with energy.
"HK$37.5 million," the auctioneer said, his voice full of excitement. He looked back toward the Hongkong Land team. "Any other bidders?"
The British executives huddled again, whispering. The entire room of several hundred people watched, waiting.
Everyone wanted the price to go higher. A new record for Central would mean higher prices across all of Hong Kong. In the end, most developers in this room would profit.
Eventually, the three Britons parted. No one raised a paddle.
"HK$37.5 million—going once," the auctioneer shouted, though he clearly wanted to delay further.
He glanced again at the previous bidders. No response.
"HK$37.5 million—going twice."
The hall went quiet.
"HK$37.5 million—sold!" The gavel came down hard.
Clap clap clap clap!
Everyone stood up and applauded enthusiastically.
Most attendees hadn't won a thing. Many had only come for the spectacle. But just being here meant you were one of Hong Kong's real estate elites.
A new record for a "land king" plot meant that Hong Kong's real estate market would keep climbing. Capital was confident, and so everyone's wealth would rise.
"Congratulations, Mr. Yang," Huo Yingdong came over, smiling. "Since Sir Robert Hotung's time, few Chinese have ever gone head-to-head with British firms over Central district land. You're about to make headlines again."
"Haha, I hope we'll see more Chinese doing the same," Yang Wendong replied with a grin. "And congrats to you as well—those two residential plots you won aren't bad at all."
"Combined, they cost less than half your bid. Mine was child's play," Huo Yingdong waved it off.
Yang Wendong said, "I'm sure one day, you'll be matching Jardine and Swire move for move."
"I hope so," Huo Yingdong replied. "Now if you'll excuse me."
"Take care," Yang Wendong said as Huo Yingdong left.
Behind him, another voice called out, "Congratulations, Mr. Yang."
Yang Wendong turned—it was Ho Sin Hang.
"We didn't really compete in the end," Yang Wendong said casually.
"That's true. I still couldn't outmatch you or Hongkong Land," Ho Sin Hang replied with a wry smile.
"Don't be modest. Who can compete with the capital power of a bank?" Yang Wendong joked.
"Banks have money, but it's not their own," Ho Sin Hang shook his head. "Liu Chong Hing Bank is a cautionary tale. I believe in real estate's potential, but I won't go too far. At most, I'll build headquarters buildings for our own use."
"That's a wise approach," Yang Wendong said. "Banks will profit from the real estate market regardless. Trying to grab everything for themselves might end up choking them."
One of the key lessons in business: don't be greedy. Even though Changxing Industries aimed to control the entire supply chain, it was about control, not monopolizing. For non-core components, outsourcing was fine.
Some businesses had to be left for others to run.
With that, the biggest land auction of early 1963 came to an end.
Yang Wendong, having just broken records in both real estate and maritime shipping, stood even taller among Hong Kong's elite.
But as always, he wasn't celebrating yet.
He knew that crisis would come in a few years—and when it did, this land, bought at the peak of the market, might become a burden if he wasn't careful.
Yet even so, he didn't regret it.
Because in the long run, Central district land was the cornerstone of power in Hong Kong.
And Yang Wendong was building a fortress of his own.
Ho Sin Hang chuckled. "Well, that saves me a considerable sum. I'll just focus more on our core banking business."
"That's certainly a wiser approach," Yang Wendong replied with a smile.
If history remained unchanged, Hang Seng Bank would only remain in Ho's hands for two more years. By early 1965, it would suffer a severe run on deposits.
What made it all the more tragic was that despite Hang Seng's rapid growth, it had done nothing wrong. Its risk controls were quite reasonable. But once a bank run starts, no bank can withstand it—not even Hang Seng. In the end, HSBC would acquire it.
Every land king auction in Hong Kong made front-page headlines.
The next day, several newspapers ran the story. Some even used photos of Yang Wendong placing his final bid as their cover images.
["Land King Sold at HK$1,425 per Square Foot – Post-it King Yang Wendong Emerges as Biggest Winner"]
That was the Sing Tao Daily headline.
Land King. Post-it King. Winner. Every word was carefully chosen to grab the reader's attention.
Inside Changxing Tower, Yang Wendong read the article and laughed. "Sing Tao Daily really knows how to praise. Even I'm starting to blush."
The article nearly declared him the future pride of Chinese people worldwide. Yang couldn't tell whether they were praising him—or setting him up for a fall.
"They're just bolder in their tone. That's Miss Hu's editorial style," Zheng Zhijie commented with a smile. "Actually, Oriental Daily could have written the same, but they're more considerate of your feelings."
"It's too much. Overhyping things is never good," Yang Wendong said after a pause. "Send them a note—tell them to tone it down."
"Understood." Zheng Zhijie nodded.
Yang Wendong then asked, "Has the first HK$10 million loan from HSBC been received yet?"
With deals this large, even giants like Changxing Group or Jardine Matheson couldn't just throw the money down all at once. That's why these land king acquisitions were always funded in phases.
The banks followed the same protocol—disbursing funds gradually. Once construction reached a certain milestone, the next payment would be released.
All of this was part of financial risk control.
"Not yet," Zheng Zhijie replied. "They've promised to deposit the funds tomorrow. Once the money hits the Lands Department's account, the title transfer will be finalized."
"Good," Yang Wendong nodded. "Notify Pei Tsu Ming immediately. Ask him to design an office tower for this lot based on the plot ratio set by the government.
Also, get our marketing team out there looking for potential tenants. It would be best if the entire building is pre-leased before completion—five-year contracts, if possible.
That way, HSBC will be more at ease. At the very least, we'll have a stable rental income to cover the loan repayments."
An office building like this would normally take over a year to complete. That meant it would be finished around mid-1964.
Historically, after the Hang Seng Bank crisis in 1965, Hong Kong's real estate market entered a downturn. Prices didn't crash outright, but indicators—especially leasing—were all negative.
By then, if rents fell, the banks would certainly pressure their borrowers.
Property prices weren't within his control, but having steady rental income would help offset risk.
"Understood," Zheng Zhijie said immediately. "Right now, leasing in Central is easy. Lots of companies want to move in."
"Good." Yang Wendong smiled, then asked, "How's Carrefour's recent property acquisition going?"
Zheng Zhijie replied, "Over the New Year holiday, I closed two land deals in Kowloon. On the Island, I'm in talks for two sites—one in Admiralty, one in Causeway Bay. They're not finalized yet, but it's just a matter of price."
Yang Wendong mentally calculated. "So once we secure those four new sites and open stores, that'll bring Carrefour to 41 branches?"
"Yes," Zheng Zhijie nodded. "We have 31 stores already open, 6 under construction, and these 4 pending acquisition."
"Not bad. Keep going with the property acquisitions," Yang Wendong said. "Any trouble from Hongkong Land? Are they trying to block us like a rash that won't go away?"
"No," Zheng Zhijie shook his head. "Even on the Island, there are still plenty of old buildings and undeveloped plots. I'm negotiating for several at once—they can't interfere.
Plus, we already have branches in Central, Admiralty, and Causeway Bay. They can't stop us.
As for Kowloon, that's definitely our turf. There's nothing they can do there."
"Good. Keep expanding this way," Yang Wendong said. "Liu Huayu's research already shows that ParknShop's management is in disarray. They made several aggressive and obvious mistakes. We need to take this opportunity to press forward."
"Understood. I've already halted all real estate investments except for residential. The rest of our property team is fully focused on helping Carrefour acquire its own sites."
"Excellent," Yang Wendong nodded. Then he asked, "What's the standard lease term for Changxing Properties?"
"Three to five years," Zheng Zhijie replied. "But rental rates are adjusted annually based on market conditions. As you know, property prices have tripled in the past few years. Rents have kept pace."
"And the penalty clauses? If property prices crash and rents drop, and tenants want out—what do they owe us?"
"Usually, six months' rent. We also take a deposit. If they default, we keep the deposit. If we breach the contract, we pay them the same. But that's unlikely. We adjust annually—we wouldn't break a contract and damage our business reputation."
Yang Wendong thought for a moment. "Starting this year, for all expiring leases, offer slightly lower rents, but increase the penalty clause. Set all new leases at five years."
Zheng Zhijie understood immediately. "You're concerned about a potential property market downturn?"
Yang Wendong nodded. "It's a possibility. I'm just taking precautions. There's no such thing as a market that only goes up. Maybe we haven't hit the peak yet—but in two years, it'll be anyone's guess."
Although the real estate crisis would erupt in 1966–67, the seeds were already being sown. The official cause would be external, but even without that, Hong Kong's housing market was due for a correction. By 1965, things were already looking shaky.
Of course, external shocks would amplify the collapse and cause an exaggerated downturn.
"Got it. I understand," Zheng Zhijie said.
Yang Wendong added, "No need to apply this to all properties. Focus on Hong Kong Island. In Kowloon, only apply this to large properties or town center assets. For the rest, don't bother."
By next year, many non-core properties would need to be sold off to free up capital.
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