In the second part of Squarefoot’s chat with Hip Shing Hong managing director David MH Fong, we talk about the SAR’s favourite conspiracy theory and the future of Hong Kong development.
Are developers really colluding with government to keep prices high?
I don’t think so.
Where did that come from?
Hong Kong’s situation is very special because the government owns all the land. The government is the biggest landowner — stakeholder — here. They control supply and when an auction happens, 95 percent of the time the land is sold and they get the revenue. So from that angle it looks like developers are “paying” the government, so they must be “working together” to make sure the market doesn’t crash. The stamp duties were designed to cool down the market, and that’s evidence they don’t work together. They demand premiums too to build over six storeys on some lots and that’s a long process. I don’t think they’re colluding and I don’t see it ever happening.
Given all the policy and politicking you just described, why do you stay in this business?
[Laughs] I’ve worked in it all my life and it’s a good one to be in. Going forward, the demand for home and space to work in is going to be there, unlike some tech products. They become obsolete so fast. The CD business is disappearing. Like a hair stylist, real estate is not going to out of business because of technology. They won’t lose that personal touch. We need to change, definitely, but people still need places to live and work. Flextime and co-working and such are game-changers, but we still have time to adjust. Oh, the impact technology keeps me up at night.
You’ve been at this 22 years. How has the industry changed?
Labour costs have gone through the roof and building technology has changed significantly. There are more real estate professionals these days too — managers, architects, surveyors. The professional pool has greater choice, it’s more international and Hong Kong is primed to do better things, more landmark buildings. There is only a handful now. I hate seeing blocks of rectangular buildings you can duplicate with a cookie cutter in a city like Hong Kong. We deserve better.
So what’s next for Hip Shing Hong? What would you like to try?
It’s more new philosophy than buildings. I get bored easily and I don’t like to repeat things. I don’t learn anything. Customers don’t need to buy the same thing all the time, like a smartphone; our staff don’t learn anything. I like to keep reading and getting out and talking to people. That’s how a company grows, by stepping out of its comfort zone. I like to consider what I can do to make management interesting, and make a space more human. That goes through my mind rather than how many sites we’re buying and how to get 30 percent growth. We need to be responsible but we shouldn’t focus only on those areas. When you become overly focused on those metrics a company becomes less human, less design focused and soon you’ll be out of touch with the market. That’s not how I want to run my company. If customers buy that philosophy I’ll survive. If they don’t think that’s right we’ll die out. We need to find a place where we meet, otherwise we don’t deserve a place in the market.
Do you think being a small private company give you more freedom to do that?
Yes. It does.
Hip Shing Hong has received a lot of accolades for historical and environmental work. How important is that?
I think it’s important we live in a sustainable city, which we’re a small part of. With the little we can do we can influence out network. We like to pilot a lot of schemes and hopefully others follow — our staff and our business partners. These things change our beliefs and behaviour. I hope a lot of companies do this, as catalysts.
Is environmental responsibility still more expensive?
It is. Some [technologies] are practical some are far-fetched. Some returns on investment are, like, 50 years. If technologies are not sustainable it doesn’t make sense. We can adopt, not necessarily the cutting edge, but more reasonable solutions we can afford and that make a difference.
Do you have a favourite building?
I like the Genesis a lot. It’s a revitalised building, an older building that has a lovely art space in it. I get good feedback on that one.
What’s Hong Kong going to look like in 10 years?
Even better than it does today. Even with the messy politics and the influence from China. Like it or not I believe in the flight of quality — be it capital, people or physical space. They go to quality places. As one of many cities in China we’ll still rank within the top ten. We’ll still command that beauty and vitality, despite the noise and the “bad” news. China will have a major influence given their size, but we’ll have a big impact on things that will advance them — like hygiene.
Don’t you think we should aim higher than top 10? How about top five?
Agreed.
