Property Firms Owned By Tycoons Kwek Leng Beng, Mochtar Riady Post Robust Earnings As Hotels Recover

Real estate companies controlled by Singaporean billionaire Kwek Leng Beng and Indonesian billionaire Mochtar Riady have reported robust first-half earnings, bolstered by a post-pandemic recovery in their hotel businesses.

Kwek’s City Developments said Thursday that it returned to the black, with a record net profit of S$1.1 billion ($802 million) in the six months ended June 30 following the sale of Millennium Hilton Seoul in February. Total sales increased 23.5% to S$1.5 billion in the first half, with the group’s hotel revenue per available room more than doubling to S$113.6 million.

“Our hotel operations segment has rebounded strongly,” Kwek said in a statement. “With post-pandemic travel fueling continue recovery, we expect hospitality to be a star performer for the rest of the year. As Covid-19 concerns wane, our hospitality portfolio will be a valuable growth engine contributing meaningfully to the group’s recurring earnings.”

City Developments is among Asia’s largest hotel operators. Through its London-based subsidiary Millennium & Copthorne Hotels, the group owns and operates over 130 hotels with more than 40,000 rooms across key gateway cities around the world.

Apart from the recovery in its hotel business, City Developments saw steady take-up in its housing projects, with the company selling 712 residential units valued at S$1.6 billion in Singapore. The developer is planning to launch more residential projects for sale in the second half of 2022 and next year.

Earnings of OUE Ltd.—the Singapore-listed conglomerate controlled by the Riady family—have also been bolstered by a revival of the hotel business, which benefitted from an increase in corporate and leisure travelers since Singapore reopened its borders. OUE said Wednesday that its net profit more than doubled to S$88.7 million in the first half following the opening of its Hilton Singapore Orchard (formerly Mandarin Orchard) in February after a major refurbishment.

The opening of Hilton Singapore Orchard was timely to capture the recovery in travel demand. Visitor arrivals in the city-state increased more than 12-fold to 1.5 million in the first half and the Singapore Tourism Board said last month that it expects the number to climb to as much as 6 million by the end of the year.

“The easing of social restrictions and reopening of borders worldwide this year saw an improved operating environment and a strong recovery in international tourism despite mounting economic and geopolitical challenges,” OUE said in a statement. “OUE’s diversified portfolio of business segments was able to capitalize on this growth opportunities.”