Chapter 125 - Another Loan of 130 Million!
In fact, Lin Haoran's judgment was very precise.
If he had deeply studied the detailed history of Hong Kong's real estate market, especially the golden years from 1978 to 1981, he would have been amazed by the crazy surge in Hong Kong property prices.
Starting in 1978, Hong Kong's real estate market skyrocketed like an unbridled horse, wildly deviating from any normal growth trajectory.
Take East Tsim Sha Tsui as an example: within just three years, from early 1978 to mid-1981, land prices soared by an astonishing six to seven times, while housing prices also rose by more than three times.
Such rapid increases not only attracted massive local capital inflows but also drew international investors from places like Southeast Asia, who poured into Hong Kong to buy land and develop buildings, further fueling an unprecedented property investment frenzy.
Thus, comparatively speaking, directly investing in land offered even higher profits!
Today, it was already February 1979.
Although a year had passed since the beginning of 1978, and land prices had already surged considerably,
there was still hope of achieving a threefold increase if one bought land now and patiently held it until 1981.
Of course, Lin Haoran didn't have access to these precise historical details —
he was relying on his general knowledge from his previous life, where he had read about Hong Kong's real estate history on the internet.
He knew that Hong Kong would experience a property market crash in 1982, and that before such a crash, there was usually a period of crazy price inflation — a real estate bubble.
Thus, based on his limited knowledge, Lin Haoran could already judge that land prices would soar along with property prices over the next two years.
Just like that competitor mentioned by Yang Mingyi,
who, after buying a plot four years ago, developed properties on it and doubled their investment profits by selling last year.
Had they held onto the completed buildings until this year, they could have easily doubled their profits again,
and if sold next year, they could have tripled compared to the original value.
"Alright, then prepare for it.
Tell the auction house that Wan'an Group will participate.
I'm going to HSBC now," Lin Haoran said decisively.
Yes, he was going to borrow money again —
but this time, not in his own name, but in Wan'an Group's name.
If he borrowed again from Yumin Finance Company,
he could certainly get more money,
but Lin Haoran wasn't willing to take that risk.
He had already borrowed over 300 million Hong Kong dollars personally from Yumin Finance Company.
If he borrowed again in Wan'an Group's name, he would have too many entanglements with Yumin Finance Company.
For his own safety, he decided not to use Yumin Finance for now.
With his current identity, he could easily get loans from any bank.
According to what he knew,
loan interest rates had risen slightly due to the booming property market,
but compared to the profits expected in real estate over the next two years,
the interest costs were negligible.
Half an hour later, Lin Haoran reappeared at Shen Bi's office at HSBC.
By now, he was familiar with the place after two previous visits.
"Mr. Lin, what brings you here today?" Shen Bi greeted him with a smile.
He had just returned from outside business and had no urgent tasks, so he was free to receive Lin Haoran.
"I've come to discuss more business with HSBC this time," Lin Haoran said with a laugh.
"Oh? What business?" Shen Bi asked, surprised.
"This time, the client isn't me personally, but Wan'an Group.
If Wan'an Group wanted to take out a loan from HSBC, what amount could you offer?" Lin Haoran asked directly.
"For Wan'an Group?
It depends.
If you want a secured loan, it depends on the collateral.
If unsecured, I can immediately approve a 50 million Hong Kong dollar limit," Shen Bi replied without hesitation.
Previously, Shen Bi hadn't been familiar with Wan'an Group —
he only knew it was a listed company.
But after meeting Lin Haoran, Shen Bi specifically investigated his background,
and thus learned a lot about Wan'an Group.
He realized it was a high-quality company whose market value was severely undervalued compared to its real asset value.
He loved lending to high-quality businesses —
low risk and solid returns.
"If I use Wan'an Group Tower as collateral, how much could I borrow?" Lin Haoran asked.
Just the market value of Wan'an Group Tower exceeded 100 million Hong Kong dollars —
equal to the Group's entire stock market value.
Thus, Wan'an Group's market capitalization was absurdly low.
Apart from the tower, Wan'an Group's only other real estate asset was the development project in North Point.
Even so, the Group's property holdings were worth around 200 million Hong Kong dollars.
Historically, Lin Wanan had always taken part of the company's annual profits for personal dividends,
following the philosophy that money on the company's books belonged to the company —
but cash in hand was truly his.
Thus, although Wan'an Group didn't develop rapidly,
Lin Wanan's personal wealth had grown substantially.
"Using Wan'an Group Tower as collateral?
We can offer up to 80% of its appraised market value.
Of course, we'll need our appraisers to assess the building's value," Shen Bi said cautiously.
80%?
Lin Haoran nodded — that sounded reasonable.
By his own estimate, he could probably borrow at least 100 million Hong Kong dollars.
"Good, please arrange for HSBC to conduct the appraisal.
I plan to use the property deed as collateral.
But I hope the process can be quick — Wan'an Group urgently needs funding," Lin Haoran said.
He did not reveal that the funding was intended to buy land.
"Don't worry, Mr. Lin.
We'll have the appraisal done today, and I'll personally fast-track the loan approval," Shen Bi promised.
"Thank you, Mr. Shen. I won't disturb you further," Lin Haoran said, rising to leave.
His purpose had been made clear —
no need to linger.
"Safe travels, Mr. Lin.
I'll call you tonight with the results," Shen Bi said as he escorted him to the door.
Back at Wan'an Group Tower, Lin Haoran resumed discussions with Yang Mingyi about the Group's development plans.
At around 6 p.m., Shen Bi called him personally.
"Mr. Lin, after thorough analysis and professional appraisal,
considering the excellent location, building size, and market trends,
we have determined Wan'an Group Tower's market value to be approximately 165 million Hong Kong dollars."
"Based on this, and our 80% lending policy, Wan'an Group is eligible for a loan of about 132 million Hong Kong dollars," Shen Bi informed him clearly.
Lin Haoran was pleasantly surprised —
he had expected just 100 million,
but 132 million was even better.
Given the surge in property prices over the past year,
the building's current valuation was entirely reasonable.
"Thank you, Mr. Shen.
Tomorrow morning, I'll bring Wan'an Group's lawyer and the property title documents to HSBC to sign the loan agreement," Lin Haoran said directly.
"Excellent.
I'll be waiting to welcome you personally," Shen Bi replied cheerfully.
This was a major deal.
Thanks to this loan, HSBC would earn considerable interest.
The next morning, Lin Haoran led Wan'an Group's core team, including General Manager Yang Mingyi,
to HSBC, carrying all necessary property documentation.
Since all terms had been discussed in advance,
and all materials were complete,
the contract signing and loan approval took less than two hours.
The final loan amount was 130 million Hong Kong dollars,
with a three-year term,
repayment of principal and interest at maturity, and redemption of the property title.
They also negotiated a clause allowing early repayment with interest reduction based on the actual loan period —
something Lin Haoran insisted on.
He didn't plan to hold the loan for three years.
By mid-1981, he intended to sell off the property assets.
By late 1981, he knew a real estate downturn would begin —
making it harder to sell.
Thus, the best time to cash out would be in early or mid-1981, at the market's peak.
With 130 million Hong Kong dollars in hand,
Lin Haoran was confident he could acquire multiple prime land plots.
For him, hoarding land was the true investment goal —
expecting a two- or three-fold return in two years.
Building apartments?
Too slow and cumbersome under current conditions.
As for using Wan'an Group's money for high-risk short-term oil or gold investments?
Absolutely not —
it would require financial disclosures that he didn't want.
He would keep Group funds and personal funds strictly separate.
"Mr. Shen, it's been a pleasure doing business!" Lin Haoran said as they shook hands.
"Likewise!
I wish you huge success with your investments!" Shen Bi replied with a broad smile.
For HSBC, this loan deal was a low-risk, guaranteed-profit transaction —
just the kind of business they loved.
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