The Kwoks: a soap opera set to run and run

If ever there was a bad time to own the biggest developer in the world’s most expensive property market, this could be it, noted Bloomberg in August. “Just ask the Kwoks.” The family behind Hong Kong’s largest real-estate empire has suffered an $8bn hit over the past year – the “steepest drop” among Asia’s richest clans.

Shares of the Kwok’s Sun Hung Kai Properties have recovered slightly since the summer as the economy has strengthened. Yet the longer-term risk for the Kwoks is that “China’s increasingly assertive role in Hong Kong erodes the city’s appeal as a financial and commercial hub”. And then, of course, there are the family’s own troublesome dynamics.

From groceries to property

Boardroom battles, bribery convictions, succession feuds, even kidnapping – Hong Kong’s richest family has experienced the lot, says Business Insider. The originator of the family fortune, Kwok Tak-seng, started life in Guangdong on the mainland before moving to Hong Kong after World War II. There he ran a grocery shop before moving, lucratively, into the garment trade and eventually co-founding property firm Sun Hung Kai with two associates in 1969. Taken public in 1972, the company imprinted itself on the modern city via proliferating office towers, hotels, shopping malls and apartment blocks. When Tak-seng died in 1990 worth an estimated $1bn, his 26% share of the company was inherited by his three sons – Walter, Raymond and Thomas – via a family trust, with Walter, the oldest, assuming leadership.

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The family drama began in 1997 when Walter Kwok was kidnapped and held to ransom by Cheung Tze-keung – a gangster known as “Big Spender”, says the BBC. By all accounts, Kwok suffered horribly. Beaten and stripped, “he was kept in a wooden crate for several days” until his family paid a rumoured HK$600m to free him. Cheung was executed the following year in China. But Walter Kwok is rumoured to have “developed a psychological problem as a result of the ordeal” and, although he retained his position as CEO and chairman of Sun Hung Kai, real control passed to his younger brothers, Thomas and Raymond. Matters came to a head when Walter “rekindled a romance with a former girlfriend” the others considered too “influential” and in 2008 he was ousted from the board. Four years later, when both his younger brothers were arrested on charges of bribing a government official, some said Walter had tipped off the authorities as “revenge”.

Ultimately, Thomas Kwok took the rap: he was sentenced to five years for corruption in 2014, leaving Raymond to run the company. Walter Kwok died in 2018. The relationship between the two surviving brothers seems healthy enough, observes the Financial Times. When Thomas was released last year, he was greeted at the prison gate “with a firm hug from his brother”.

A punt on China

Worth an estimated $33bn despite their travails, “the Kwoks have a history of defying sceptics”, says Bloomberg. When the Asian financial crisis and Sars plunged Hong Kong into one of its worst property bears from 1998-2003, they invested heavily – building the tallest skyscrapers in town, ICC, One IFC and Two IFC, where many international investment banks are housed. They’ve responded to recent troubles by pushing into China and backing the latter’s incendiary new security law in Hong Kong. Time will tell if that was the right punt.