Meet the Hong Kong billionaires behind some of the world's glitziest hotels — and the generation who could inherit the empire

Adrian Cheng makes a toast during dinner after the opening ceremony of the Festival de Cannes Film Week in Asia in 2019.

Chung Sung-Jun/Getty Images for Festival de Cannes Film Week in Asia

• Cheng Yu-Teng's family is one of the richest in Hong Kong, with a property empire larger than Central Park.
• The family also owns the Carlyle, the glitzy New York City hotel that's tied to the Met Gala.
• Cheng's grandchildren, Adrian and Sonia, are in the spotlight as contenders to inherit the family's wealth.

The Cheng family is one of Hong Kong's most prominent and richest families, owning billions in property and a bustling jewelry business that's a household name in Asia.

Bloomberg estimated their net worth to be $22.7 billion in March, though it's since fallen to $17.7 billion in September.

The family's company, New World Development, oversees about 41.5 million square feet of property — more than all of Central Park — in Hong Kong, Asia's most expensive city for real estate.

The Cheng clan revolves around the families of two brothers, though the elder and his children have long been considered the main force in the business.

As he nears 80, the family patriarch is expected to name a successor. But he's been coy so far with his plans, and rumors of a possible family feud abound in Hong Kong.

Here's what you need to know about the Chengs, a family whose massive wealth is rooted in the city's early days:

The Chengs' wealth comes from their grandfather, a jeweler turned real estate mogul.

Cheng Yu-Teng, pictured in the center, ran a property empire birthed from the profits of his jewelry business.

Jonathan Wong/South China Morning Post via Getty Image

The Chengs' empire can be traced back to World War II, when their grandfather, Cheng Yu-Tung, started working as an apprentice at a gold shop in Macau called Chow Tai Fook.

In 1943, he married the daughter of the shop's owner, moving shortly after to Hong Kong to open the store's first branch. As the Asian financial hub's affluence accelerated after the war, so did Cheng's business, which specialized in 24-karat gold jewelry.

The jeweler invested his profits heavily in real estate during the 1970s, starting a company called New World Development. Now publicly listed, it owns department stores, hotels, and infrastructure across mainland China, Hong Kong, and the US.

Cheng died in 2016 at the age of 91, when he was worth about $14.6 billion. His elder son, Henry, took over the jewelry and real estate empire.

With the 77-year-old Henry now signaling that he may be looking for a successor, his two eldest children, Adrian and Sonia, have entered the spotlight.

Each has been running a key pillar of the family's property business for over a decade, so they're considered the de facto contenders for their father's position.

Both oversaw meaningful expansions in their primary fields — hotels for Sonia and commercial real estate for Adrian — and have worked to transform their properties into cultural icons for younger generations.

Sonia runs the family's hotel business, turning it into a sprawling collection of resorts and luxury locations.

Sonia Cheng, pictured left, is the head of the Rosewood Hotel Group, which owns 51 hotels and is planning more than two dozen others. The group includes the Carlyle in New York City, pictured on the right.

Pascal Le Segretain/Getty Images for The Business of Fashion and Thomas Iannaccone/Penske Media via Getty Image

Sonia, 43, studied applied math at Harvard University before working as a real estate banker for Morgan Stanley and in private equity for Warburg Pincus, according to a 2019 profile by CNBC.

In 2008, she joined her family's business at age 28, becoming CEO of Rosewood Hotel Group three years later when the Chengs purchased the properties from Rosewood Corp. and Maritz, Wolff & Co.

The luxury hotel brand owned 19 properties at the time, including the glamorous Carlyle Hotel in Manhattan, which celebrities flock to when they visit for the Met Gala.

With Sonia at the helm, Rosewood has since expanded into a global powerhouse for luxury hotels, with 34 locations and another 24 on the way.

It's pushed hard into mainland China under the brand name New World Hotels, opening 16 more properties in cities such as Beijing, Sanya, Shanghai, and Shenzhen, for a total of 51 hotels and resorts.

Sonia has often said that she grew up in the hotel industry, since her father, Henry, started his career as general manager of a hotel.

Her philosophy, according to the Singaporean outlet Channel News Asia, has been to ditch stuffy hotel standards and attract younger travelers looking for tailor-made experiences.

"There's a sense of discovery and curiosity when we go to hotels, we don't want to go to a place that doesn't reflect the local culture," she told the outlet.

Rosewood's Hong Kong property ranked second on the World's 50 Best Hotels' 2023 list, with two other hotels in São Paulo and Paris earning spots as well.

Sonia is married to Paulo Pong Kin-Yee, who also comes from one of Hong Kong's wealthiest families, the Pongs. He's the founder of Altaya Group, a wine wholesaler, and the boutique restaurant company Classified Group, which runs five locations.

Adrian, the eldest sibling, helms his brand of billion-dollar megamalls that double as art museums.

Adrian Cheng, pictured in the center, launched K11's art malls in 2008.

Keith Tsuji/Getty Images for K11

Adrian, 44, was long presumed to succeed his father as head of the family's wealth.

The eldest of four siblings, he started his career as a banker at UBS and Goldman Sachs before diving into the family business in 2007.

A year later, Adrian launched K11, his brand of malls and office buildings in Hong Kong and China that came with a unique selling point — a focus on showcasing art and designer work.

Art has been core to his personal brand. A classical singer who trained on Broadway, he graduated from Harvard with a Bachelor's in East Asian Studies.

He's perhaps best known for K11 Musea, a $2.6 billion mall on Hong Kong's Victoria Dockside that has some 40 art installations and hosted Asia's first-ever Cannes Film Festival Week in 2019.

Adrian himself maintains a long list of personal art ventures, from organizing a Louis Vuitton menswear fashion show in November to paying to save an iconic 1,300-seat cinema that opened in 1952.

Often seen as the heir apparent to the Cheng business empire, he's dominated the lion's share of headlines about the family.

Like his sister, he led aggressive expansions for New World Development, pouring billions into residential and commercial buildings in Hong Kong and Chinese urban hubs.

His vision is to bring K11 to nine Chinese cities in total, and he's now building a mall in Shenzhen that's estimated to cost $1.4 billion.

A prolific investor, he's put money into over 60 companies through his fund, C Ventures, including Shein, EV makers like XPeng, and COVID-19 detection tech startup Prenetics.

C Ventures declared assets of over $700 million when it merged with a Swiss investment firm in July.

Adrian is married to Jennifer Yu, who runs Chow Tai Fook Education, a collection of K-12 schools and play facilities, and Arch Education, a tutoring company.

Their father, Henry, hinted at a succession toss-up at a time when Adrian was expected to be heir.

Henry Cheng is chairman of New World Development and is pictured here at a 2016 press conference on the company's financials.

Jonathan Wong/South China Morning Post via Getty Images

In November, Adrian and Sonia's father turned heads with a cryptic remark about his successor in a television interview.

"I'm still observing, but I think it's not so easy to identify such a person," Henry said. If there was no one suitable, the Chengs could "hire from the outside," he said.

Each family member could continue to helm their own sector of the business, Henry added.

That comment rattled what had for years been presumed by the business world as the plan for the Chengs — that Adrian would take over everything.

By then, the family's net worth had reached $26 billion, and Adrian was already CEO of New World Development, though his father still controlled the family's assets.

Bloomberg noted that Adrian's representatives had described him in 2020 as "the heir to New World Development and Chow Tai Fook Enterprises."

Henry raised further uncertainty in December about his family's succession, when Adrian and Sonia's younger brother, Brian, was placed in a top role in the company's construction and infrastructure arm.

All three were now poised to lead their own fiefdoms in the Cheng empire, with Henry's fourth child, Christopher, holding an executive directorship at the company.

Their cousin and the vice-chairman of Chow Tai Fook, Conroy, denied in a November earnings press conference that there was any family infighting.

Still, the Chengs are beset by bleak market conditions as Hong Kong tries to regain its footing.

The entrance of the K11 Art Mall in Hong Kong on September 2.

NurPhoto/Getty Images

Amid rumors of a succession feud, the Chengs have another storm to weather — Hong Kong's ailing property market.

The city has suffered a rout among investors and residents after recent years of political turmoil, coupled with a weaker post-COVID economy and lower demand for property from mainland China's wealthy buyers.

Rising taxes and interest rates in the city have also slowed the market, hemming in New World Development after it gobbled up loans and new properties.

The company's stock has dropped about 82% in the last five years.

In late August, New World Development reported that it was expecting to post its first loss in 20 years — of up to $2.6 billion — for the 2023 financial year, which ended in June.

It was a sign of heavy pressure on the company, which is already considered one of Hong Kong's most indebted property developers.

The Financial Times reported shortly after the announcement, citing several unnamed sources familiar with the company, that New World Development staff were growing worried about how quickly the Chengs were expanding.

"Today we face one of the most challenging combinations seen in decades — from high interest rates to uncertain market conditions," Adrian said in a statement to the FT. "I believe this game of patience paired with consistency and dedication will eventually get us to our goals."

He's been attempting to shore up confidence in Hong Kong's status as a financial hub, starting an institute in November 2023 to promote the city to the wealthy.

"I'm very confident we will be number one for family office wealth management in the future," he told Bloomberg in August.

A representative for New World Development declined to comment for this story.

Read the original article on Business Insider

from All Content from Business Insider https://www.businessinsider.com/meet-chengs-adrian-sonia-new-world-development-richest-hong-kong-2024-9
via gqrds