Wing Lung Bank scion’s family office eyes hospitality, tourism plays
The family office of a scion of Wing Lung Bank's former owners is looking at investment plays benefitting from the tourism boom in Asia post the COVID-19 pandemic, even though it is overall a conservative investor.
“We favour the mainstream hospitality and tourism sectors in Asia, as more people are travelling,” Samuel Wu, chief investment officer and executive director of Tridel Capital, told AsianInvestor.
“We recently invested in a fund that focuses on ‘affordable’ luxury brands,” he added, but didn’t provide further details.
Wu was previously a key member in the sale of his family’s controlling share in Wing Lung Bank, which was sold to China Merchants Bank in 2008. He was also instrumental in the integration of both banks.
Wu led his family office in the redevelopment of key family property holdings and subsequent divestiture of assets.
Hong Kong-based Wu told AsianInvestor that people are still riding the post-COVID-19 “feel good” wave by travelling and spending, although not with the same urgency and “revenge travel” mentality seen when COVID-19 restrictions were lifted.
“These industry sectors could be worth keeping an eye on.”
Asia-Pacific is expected to be the only region in the world to recover by 2023 to recover from COVID-19 pandemic, with tourism revenue contributing 32% more to the region’s GDP than before the pandemic, according to the World Travel &Tourism Council (WTTC).
The WTTC also predicts that the region will add 65% of the new jobs in the global travel industry in the next decade, with China and India leading the way.
The outlook for tourism remains fairly strong in 2024.
The announcement of pop mega star Taylor Swift's concert dates in Australia, Singapore, and Japan this year, for instance, sparked a surge in flight bookings and flight searches for these destinations, according to media reports.
Similarly, hotel occupancy levels in APAC have climbed steadily, amid a surge in leisure travel and a strong pick-up in conferences and events around the region, despite lower airline capacity and staff shortages and high cost of travel.
There is, nevertheless, some caution amid high interest rates and inflationary pressures.
Wu said that the family office is also keen to explore opportunities affected by high interest rates, such as property and related stocks.
“However, our overall strategy remains defensive and conservative, due to the prevailing uncertainty in the market,” he said.
He also noted that there are ‘arbitrage’ opportunities related to geopolitics with some companies in Hong Kong, although he didn't elaborate.
CONSERVATIVE INVESTING
Wu’s family office invests across Asia, such as Japan and Singapore, apart from Hong Kong. “I have hopes about China too, but I would wait for things to settle down a bit first,” Wu added.
Wu is also co-founding executive director of Malvern College in Hong Kong – something he is especially proud of.
“The education sector is often referred to as the ‘happy money’ sector – you earn money by doing something good. It's about trying to change the world through education,” he said.
Tridel Capital is generally a conservative investor, said Wu.
“Cash is always a significant component of our assets due to legacy issues. Our forefathers always reminded us to save for a rainy day. However, this doesn't mean we avoid opportunities that carry greater risks and rewards.
“I am stating the obvious here, but we only engage in deals that make financial and practical sense. So far, this approach has served us well. “
Image credit: Shutterstock
IN-HOUSE AND EXTERNAL MANAGERS
While the family office makes in-house investments, it also allocates to external asset managers depending on the nature of the investment.
“The private equity and direct investment side is usually handled in-house, while the bulk of the traditional portfolio of equities and fixed income is managed through private bankers and fund managers,” he said.
As with all family offices, relationships are crucial.
“We have worked with the same external teams for years. The key to our successful collaboration is their flexibility and dependability,” said Wu, noting that the managers know the family office very well and understand its comfort zone.
“This does not mean that new managers are ineligible, but they must understand that the relationship grows over time, especially with a conservative family office like ours,” added Wu.
Wu teamed up Ronald Chan from Chartwell Capital, to form Chartwell Family Partners, a single family office alliance, in November 2023 to encourage sharing best practices and to find common solutions with other family offices.
Both of them are co-founders and managing partners of the alliance.