Transcription
George, thank you so much for talking to me. You're retiring? Indeed. Looking forward to it.
You know, it's been six years since I last spoke to George Hongchoy, the CEO of Link REIT. Back then, he was nearly a decade helming Asia's largest real estate investment trust. Under his leadership, the company's portfolio grew from 40 billion to over 220 billion Hong Kong dollars. Well, after 16 years, he's decided to step down. So this time round I catch up with him to get real insights about his journey and what's next.
We first started our office is on the top floor of this car park building. Okay. So that's the one there. I used to come here to work every morning. Now we use it for one of the departments. Yeah. A lot of memories how I come to work here every day.
16 years ago, I'm guessing you were in your late 40s. What was the younger George Hongchoy like back then? Was he bold? Was he ambitious? I certainly wanted to do something, you know, make some impact. Joining Link is a great opportunity to do that. I joined as a CFO before I became CEO. You know, like now serving a lot of people in Hong Kong and thought that through the job I can actually make a big difference.
Did he ever think he would be running one of Asia's largest REIT? No, I think at that time we really had a humble beginning and we're trying to just do much better with our asset at that time trying to improve on that and as we became more confident then we expanded um but that was uh quite far away from our visions at the time.
Link REIT made history in 2005 as Hong Kong's first real estate investment trust. At the time, its portfolio included 180 shopping centers and car parks formerly owned by the government. The newly privatized assets were valued at 33.8 billion Hong Kong dollars or about 4.3 billion US. When George Hongchoy joined in 2009, his first office wasn't in a sleek high-rise. It was a modest space converted from a car park, a humble beginning in the company's early days.
So in terms of corporate culture, what was the vibe like back then when you first started 16 years ago? Well, we've given these asset that we bought at the time of the IPO. We're still looking at how to improve them. So, everyone was quite excited about what we can do to these properties. So, there was a lot of optimism, a lot of energy trying to manage these assets. There is uh all that energy and also there's a lot of people who are protesting as well um complaining about the change that we have to go through so there's sometimes a lot of anxiety as well.
Were there are a lot of late nights? A lot of meetings? No, we weren't working too many late nights. But the office is very small here with five or six offices scattered around Kowloon actually quite inefficient in how we run it because of the location, and then in 2009 we we put them all in one building.
Hongchoy, a former investment banker, came on board as CFO and within a year stepped up as CEO. The timing couldn't have been tougher. The world was reeling from the global financial crisis and he had to steady the ship fast. He pushed for a 3 billion Hong Kong dollar refinancing, a bold move that gave the company the capital it needed for its next phase of growth. And it started here in this boardroom.
One of the big decisions that we made was to insource uh property management. We don't manage the property directly ourselves. Uh In the early days 2009 uh we decide to insource that. That decision was made here and then we have to hire 500 plus people and bring them on on board. So uh that was a big exercise. The move helped the company build stronger tenant relationships and enhance shopping experiences giving Link REIT a significant boost towards market leadership.
You've seen through some of the worst crises, the global financial meltdown, the social unrest in Hong Kong, the COVID-19 pandemic and the ongoing China geopolitical tensions. I've also seen the good things and you know we've done well and Hong Kong have thrived you know during this time as well and so the question is how we built a resilient business with a good team and everyone worked together you know towards delivering our vision and you know Hong Kong gone through that and it has always rebound and done well so look at it at a positive side.
Link REIT is marking two decades since its listing in 2005, and it's a journey that hasn't always been smooth. As it prepared for its IPO, the company faced push back from small retail tenants in the community malls, worried that Link's newfound obligation to its shareholders would price them out. And that tension didn't just fade away.
A lot of people are saying that Link in a way has made your community malls more commercial. We're now seeing a lot of big chains, fewer mom and pop shops. Do you think that life has become much tougher for these small local retail businesses? I'm excited to see some of them grow within our portfolio. You know, we have one chain, Taste of Asia, that have started with us and now they have over 200 stores around Hong Kong with the majority at our mall. So the entrepreneurial tenants who actually can cater for changing needs of the shoppers have done very well. The mom and pop stores who stay exactly the same for the last 30 40 years have actually been affected not so much by our decision but the shoppers deciding that they need something newer, something better. The chain store percentage haven't really changed over the years. It's always about the same.
Has it been difficult trying to strike a balance the tension between helping these small shop holders trying to survive and you know the responsibility that you have to please your investors by giving them higher returns? I think we get high return for our investors when we do all the right things from having What is the right thing? Well, it includes having the right mix of tenants, sustainability in terms of, you know, how we work with the environment in terms of energy savings and community impact. We do a lot of community engagement. And I sometimes find that you start by not thinking about the numbers first, but thinking about all the good things that you need to do for the variety of stakeholders that you need to deal with. And we are operating almost in a glass house, people watching us and be criticizing us on a daily basis and that actually help us because we have to think about the implication of our decisions before we actually press the button. People say retail is detail and we do plan with all that in mind have actually help us to deliver.
These criticisms that you receive. Have they been difficult? How do you approach them? One of the things I learned very early in my uh position is that sometimes when people shout my name, it's about the position and not about me personally and being able to separate the two is actually quite important. Whoever sit in this chair will have to deal with some of these issues and that's come with the job and one have to accept that.
Any regrets? I don't think there's any regrets during the 16 years that I've been with Link and the reason is very simple. We don't have a crystal ball when we make decisions. We do our due diligence, gather the best information that we can have, getting the team's input, guidance from the board, input sometimes with the community when we get surveys done and you make that decision at the time and afterwards if the things didn't turn out the way that we have expected, we learn, not so much as mistakes, but adjusting to how we should have done it.
George Hongchoy has led Link REIT for 16 years, steering its transformation from a Hong Kong focused portfolio into one of Asia's largest real estate investment trusts. And that global push began in 2017 with a major move into Australia. So we've bought a a Deutsche Bank place in Sydney, Barry place, Colin Street in Melbourne. Um our first asset, our first acquisition- 100 Market Street office there at Westfield Sydney. Some iconic mall uh, Queen Victoria building in the city center. That's 100 year old building, very vibrant shopping mall.
How did this deal come up? It was very interesting. Since it was renovated, it has never been owned by anyone except Asians. There's a Malaysian developer was staying at the Hilton looking down at the dilapidated building and talked to the city council and say why don't we renovate it and then the become a shopping mall and the city council agreed and then they sold it to GIC and then we bought it from GIC. So it's always been Asian owned somehow. Interesting. Interesting.
You're not going to let go anytime soon are you? No, we love this building. It's doing very well.
Beyond Hong Kong and Australia, Link REIT has a foothold in China, the UK, and Singapore. The big overseas push helped grow the portfolio to over 200 billion Hong Kong dollars, or about 25 billion US. But not every market has been a win for Link. Take the UK for example. In 2020, the company made a bold move acquiring The Cabot in London’s business district of Canary Wharf for over $480 million US. We spent a lot of time studying the UK. We were looking at doing quite a lot of things there and we thought that was you know the right place to to build and then we realized yeah after one investment it wasn't and then we all and say that that's not the market and that may be too far as well as we pivot and focus on Asia Pacific and then with hindsight with all the things that's gone through uh the UK economy and politics and all that you probably would have liked not to have made that investment.
So you think it was a mistake going into the UK? So it wasn't a mistake at that time because it fits the strategy at the time, but it's no longer fit for the strategy now and for the future. So you know, we'll look at reversing that somehow.
Looking at the steps you've taken, do you think your diversification efforts have gone far enough? Was there a particular market you wanted to get into but lost out on an opportunity? We've looked at quite a few countries and for Singapore, we've looked at Singapore for over 10 years and we've only managed to do a deal recently and usually its a chicken and egg situation. Do you want to have people there first or the asset first? We've studied Japan for a long time. We haven't got in um and buy anything yet, but we have now to break that chicken egg cycle with high people there, you know, based in Tokyo starting to look at assets there and we'll probably will do some deals in Japan nearer term.
So, George, are you counting down the days to your retirement? Yes, it's uh getting close to that day. What will you miss most? It's the friends, you know, the people that I've worked with for many years. you know, we've gone through a lot and uh you know, I will still go back to the shopping centers. I still go and shop. The impact that we make every day, I think that's something that I will miss, you know, having led the team to be able to make such a difference to Hong Kong and other places around the communities that we've served.
In July 2025, George Hongchoy announced that he's stepping down as CEO at the end of the year after 16 years at the helm. What has been highly publicized is your pay package, the timing of the company's layoffs. How do you feel that something like that is clouding your departure? When it comes to compensation, the board with advice from consultants have come out with what is right for the executive team and a lot of that compensation is based on performance and these measures of how we perform against our targets uh relative to our peers, share price performance, are all factors and so we have done well. I guess uh that has led to the reward that we should give to the executive team. What we continue to to do is set these tough targets. These tough targets that we have managed to deliver on over a long period of time have done well for our investors. And look at the return over a consistent period of time since IPO delivering a over 10% uh compound uh return to our investors, um asset value growth etc. we've done well.
Link has become such a big part of your life's work. How has it shaped you as a leader, as a person? I look back more recently as I sort of uh ponder about, you know, what I have achieved with Link. I've changed a lot. How have you changed? Personality wise, you know, personality wise, I've changed. I was more of an introvert. You are an introvert? No, I was. I was probably less willing to lead than manage in my earlier days even before Link in other roles that I I had and I was probably more a manager technical expert in certain fields and the transformation to lead when you're not doing it yourself but to have people doing it on a day-to-day basis and all you do is set directions. I used to run the whole business without a COO and CIO and now having the two of them, you know, my job is smaller. You've learned to delegate. And learning to delegate is hard. It's hard when you haven't built momentum in certain things that we do that is new. I think the hardest thing is when you go to a new place, do I trust this team? Do they work in the Link vision and values? And when you see that the integration is done, then you move back. You go to do something new again. And so when they don't see me, that means they're doing a good job.
Do you ever think about the legacy you're leaving behind? I don't think it it's right to talk about a personal legacy when you are in a role running a company, its really about the whole team. And my own sort of personal management style is really thinking about how to put people in the right slot and motivate them, reward them and let them do well. I still remember when the chairman asked me to be a CEO and this was 15 years ago and I put together a 90-day plan. We look back after that 90 days. I didn't realize at the time when I was writing it but most of the topic was not about real estate was about people our tenants our investors and really how to get all of them to work in that single direction of delivering the vision and so if one come to tell me oh you've done well because you know it looks like we're going the right direction according to our vision then that might be the legacy that one can say we have uh delivered.
What do you want your employees to remember most about you leading Link? I think most of my colleagues will say, you know, George work really hard they get that phone call at 3:00 a.m. Um, Do they say George is very demanding? I am very demanding. You have to be very demanding and you push, you know, for a very high expected result. And sometimes you get that and sometimes you get a little bit less. But hopefully every time you look back and say wow we've done the impossible. And I think the pride that you know we have built with the team is we really have done something impossible. Looking back even at this time of when I started I was the first CEO for this company. We didn't expect Link will look like what it is today. We've done really a lot of things beyond our imagination. And all of that is really small steps. It's really about building confidence as you have every success and the success becomes bigger and bigger.
And finally, what does retirement look like for George Hongchoy? Will you be traveling, golfing, or are you the sort that never stops working? I'm a avid golfer, so I still have a long bucket list of golf courses that I want to play at. But seriously, it's that I've really worked very hard for Link. There's really not a lot of time to reflect, to renew, but at this moment, my focus is finishing the transition and then having a time of refresh and renewal.
Do you ever think about the last day of work at Link? The last day of work will be emotional. I think walking out of the office. Yeah. No, I haven't been thinking about that last day yet. Uh there's still a lot of work to be done in this period. I'm busy and so uh the last day will come when it comes but in the meantime continue to work with the team and hopefully continue to produce good results.
Can you promise you won't cry? I can't promise.
George, thank you so much for talking to me and best of luck. Thank you for your retirement ahead. Thank you Christine.