One of China’s largest toy manufacturers, Chinese – Hong Kong billionaire Francis Choi, has emerged as the likely buyer of the Exchange Centre in Bridge St, Sydney.
The near $340 million deal has sent shockwaves through the office market in Australia.
The Guangdong Province native is a self-made billionaire who opened his first factory in 1972 at age 25. He worked with US giant Mattel to make Snoopy merchandise as he built his fortune.
The former toy salesman is founding chairman of Early Light International. He holds an MBA and a PhD in business management. He has extensive existing property holdings although the Exchange Centre would be the biggest local investment for the man known as the “king of toys”.
He is one of the new breed of investors out of greater China setting benchmarks across major capitals. The Cheung family bought a three-quarter stake in the Sydney’s MidCity Centre at a record yield last year; and Macau gaming dynasty the Loi family bought oil giant ExxonMobil’s headquarters in Melbourne.
The asset, which sits in a CBD precinct undergoing a dramatic overhaul, was sold by Malaysian group KWAP on a record passing yield of 3.9%.
The deal is likely to show a core yield of about 4.6%. KWAP, whose mandate was run by Investa Property Group, had Ian Hetherington, Simon Fenn and Ben Azar of Savills as brokers on the sale of the high-profile complex. They declined to comment.
He worked with US giant Mattel to make Snoopy merchandise as he built his fortune
Early Light International remains the world’s largest toy maker, and Choi’s fortune was estimated at $US5.7 billion last year, according to business magazine Forbes. The tycoon moved into property in 1988 as toy-manufacturing became more competitive.
Over the last two decades Choi bought car parks, retail shops, office blocks and luxury residential apartments in and around Hong Kong. The E. Lite Property unit, a subsidiary of Early Light International, owns prime real estate in Hong Kong and mainland China.
Choi had been chasing towers in Melbourne last year and is said to have been drawn to Sydney’s rising office rental market. The building, a block from Circular Quay, is in an area being largely redeveloped. Choi owns a stake in and sits on the board of HK-listed Regal Hotels International, one of the city-state’s largest hotel operators.
The deal has benefited listed Australian real estate investment trusts, including Investa Office Fund, which is having its portfolio revalued as it seeks to ward off Cromwell Property Group.
The building, home to the ASX on a 12-year lease, last traded in 2011 when the Malaysian fund bought it for $185 million.
It re-signed the ASE despite an attempt by Lendlease to lure the exchange to its Barangaroo South development.