Qian Jianrong, executive chairman & CEO of Chiwayland International. Photo by Leong Chan Teik
As we settle into breakfast, Qian Jianrong is attentive to lengthy comments by some analysts who espouse their views on how Singapore-listed Chiwayland International could win wider investor appreciation.
Mr Qian hardly touches his food, not just at the start but for the rest of the hour or so while we had our fill of porridge, noodles, cut fruits, etc served at the boutique hotel in Suzhou that is owned by his privately held Chiway Group.
When the visitors have had their say, he gets going with his views.
Along with his clean-cut look, and his apparent disinclination to engage in small talk, the trim and tall Mr Qian, 50, cuts the figure of an educator.
In fact, somewhere in the past, he was one.
Prior to founding the Chiwayland Group, he was Deputy Section Chief at the Bureau of Education of Zhangjiagang Municipal Government in Jiangsu Province from 1988 to 1991.
In 1996, he co-founded a private education business which is currently held under an investment holding company, Chiway Holding, of which he is the majority shareholder.
He found time to obtain a Master of Business Administration from the China Europe International Business School in 2000, adding to the Bachelor of Science degree he graduated from Soochow University with in 1988.
In their education business, the founders of Chiwayland gained experience in the property development process by planning and developing their own schools.
Then they struck it big -- they were invited by the Suzhou government to develop certain parts of Suzhou International Education Park (North) (蘇州國際教育園(北區)), spanning 3.5 million sq m.
In 2004, the Chiwayland Group went on to develop its first residential property project, Suzhou Xuefu Garden. It was a sizeable undertaking.
It was a mixed development of 356,626 sq m comprising 2,734 residential units, 80 commercial units, one primary school and one kindergarten. Suzhou Xuefu Garden was completed in 2009.
Fast forward to the present. A large chunk of Chiway Group has been carved out as Chiwayland International and listed on the Singapore Exchange.
Singapore visitors inside a show house of a new Chiwayland property project. Photo by Leong Chan Teik
♦ Notes on Qian Jianrong's views at breakfast
4.1 – 14.8 cents
Net asset value/share
29.6 SGD cents
No. of shares
Source: Bloomberg, Company
1) Given the expected profit for this year, do you intend to have a dividend policy?
- being the single largest shareholder, my interests are definitely aligned with that of minority shareholders
- if the Group is able to perform well financially in line with our expectations, we do not rule out the possibility of paying dividends.
- but bear in mind that we are still in a growth stage and it is important for us to strike a balance in the allocation of our financial resources.
2) Why undertake more land parcels in Wuxi recently?
- imperative for property developers to always acquire new land bank to maintain the growth momentum and at the right timing
- Wuxi is going through a property upcycle and we want to be ahead of the curve
- it faced oversupply over the last few years and that market was underperforming
- we feel that it is the right time now to re-enter the market given the rising demand that our team anticipates
- apart from on-site observations, making qualitative judgements, we assess market and industry statistics such as housing units inventory in the province, city, etc
- we have reliable sources for the market and industry statistics from localised service provider
Qian Jianrong: Owns 86.0% stake in Sinway Investment which owns 74.75% of Chiwayland International. Photo by Leong Chan Teik3) Regarding the real estate sector in China, do you think a bubble is forming?
- it is important for the Chinese government to control the economics of the real estate sector (demand from market and supply of land to be released by the govt)
- important for the government to identify the expected demand of the respective cities (tier 1, 2,3,4,etc) and to accurately release the right amount of supply to each market
- this is essential to provide stability to the housing prices
- as all land parcels are decided and released by the Chinese government, the decision making process from the government is critical
- some cities have suffered as housing prices have stagnated over the last few years but are enjoying a sharp rally now
- there is a herd instinct mentality among buyers as most stay on the sidelines and wait for the first uptick before rushing in
- most importantly, there is real demand for properties as seen in the buyers' profiles. We see that the majority of the purchasers, at least for our projects, actually live in the units
Real demand is driven by several factors:
i) urbanisation and domestic migration to top tier cities
ii) given the sheer size of the cities we operate in such as Suzhou, you see those who studied and worked initially there wanting to live and remain there; there is also inward migration to the city centre
iii) abolition of the 1-child policy in China has created a demand for larger homes. A lot of our newer property launches are larger units to capture this demand
iv) our projects are mostly strategically located, along major transportation routes, within the vicinity of top schools; close proximity to amenities, etc.
After breakfast, Mr Qian and CFO Chua Hwee Song (in blue long-sleeves) pose for pictures with Chiwayland staff and Singapore visitors.
(Tok Chong Yap contributed to this article)
Click on video (2 m 45 seconds) of our visit to Chiwayland property projects.