Far East Organization (FEO) is a property development group founded by Ng Teng Fong in 1960.1 It is the largest privately held property developer in Singapore, with developments spanning the residential, commercial, retail, hospitality, industrial and healthcare sectors. In Singapore, the company has developed over 700 properties, including condominiums, hotels, offices, shopping complexes and offices.2 There are over 180 development and investment companies – both privately held and publicly listed – under the group. Together with its Hong Kong-based sister organisation, Sino Group, FEO has assets of over US$40 billion and employs more than 13,000 staff worldwide.3
Beginnings
Ng, whose parents were immigrants from China, set up FEO in Singapore in 1960. It was said that he had assistance from billionaire, Eliya Thamby,4 early in the venture. Ng named the company “Far East Organization” after being inspired by the success of film studios Cathay Organisation and Shaw Organisation.5
In 1962, FEO completed its first development project of 72 terrace houses at Jalan Pacheli in Serangoon Gardens that were sold for $20,000 each.6 Ng made his maiden foray into the hotel industry the following year with the development of Singapura Forum Hotel on Orchard Road. The hotel, which cost S$5.5 million to build, was sold in 1982 for S$178 million.7
FEO subsequently continued with residential developments such as Katong Seaview Palace in the East Coast area in 1967 and Watten Estate in Bukit Timah in 1969. In 1969, FEO also made its first venture into a publicly listed entity with the construction of Singapore Hilton hotel.8
As FEO took on projects of increasing magnitude and cost, it ran into financing problems when a local institution withdrew its credit facilities. However, Ng found alternative financing arrangements with the Moscow Narodny Bank, and FEO was able to continue with its expansion plan.9
Besides residential and hotel developments, FEO had diversified into other areas by the late 1960s, including finance and retail. FEO’s associate and subsidiary companies included Lucky Realty, Far East Land & Housing Development, Far East Curio Centre and Far East Finance.10
Dominance on Orchard Road
Having developed Singapura Forum Hotel and Singapore Hilton Hotel on Orchard Road, FEO ventured into retail property development with the construction of Far East Shopping Centre in 1974.11 This was followed by the development of other shopping and office complexes in the area, including Lucky Plaza (1978), Orchard Plaza (1981), Far East Plaza (1983) and Claymore Plaza (1984), which cemented FEO’s dominance at Singapore’s prime retail strip, Orchard Road.12
As chairman of Far East Organization (FEO), Ng was nicknamed “King of Orchard Road”. His shopping centres featured a number of firsts: Far East Shopping Centre was the first mall in Singapore with an atrium and external escalators, Lucky Plaza had see-through bubble lifts, and Far East Plaza had serviced apartments above the mall.13
Singapore’s largest private property developer
1980s
By the 1980s, FEO was regarded as the largest private landholder in Singapore. The group’s aggressive land acquisition – even through downturns in the property market – was a carefully calculated long-term strategy that was Ng’s trademark.14 Profits from completed developments were used to acquire new land – at times at record prices – and FEO was known to have one of the largest land banks in Singapore.15
O adopted the strategy of acquiring land, and then completing and selling developments quickly. When supply overtook demand in the property market in the mid-1980s, the group cut prices to attract buyers to its developments. With the market crash at the time, there were again rumours that the group was in financial trouble, but it managed to ride out the downturn.16
1990s
FEO reaped the rewards of a strong property market in the early to mid-1990s. Its land purchases peaked for the decade in 1994 and 1995 at S$2 billion per annum. In 1997, the group had a 41 percent share of the private residential market in Singapore, with 2,410 units sold during the year.17 The Bayshore condominium, completed that year, reportedly brought in at least half a billion dollars in profits for the group.18
FEO’s portfolio of hotels, shopping malls, serviced apartments, offices and commercial spaces also generated a recurring income stream. In 1995, FEO owned about 35 percent of all serviced apartments in Singapore, including the flagship, Orchard Parksuites, which cemented its position as the largest owner-operator of serviced apartments.19
After a high profile takeover contest with Malaysian businessman Quek Leng Chan, FEO acquired a majority stake in Yeo Hiap Seng in 1995.20 Following the acquisition, Yeo Hiap Seng and Orchard Parade Holdings (the former Ming Court Hotel Ltd that Ng had acquired in 1987) became two of the more prominent listed companies under FEO.21
In early 1998, in the midst of the Asian Financial Crisis, FEO and Sino Land (the listed arm of Sino Group) were hit by rumours that they had defaulted on bank loans. The group quickly denied the rumours but stock prices of its listed companies plunged to multi-year lows. FEO’s measures to combat the rumours included disclosing its financial position and reporting S$2.5 billion in property sales in 1997.22 It also disclosed its gearing (ratio of total debt to total assets) as 0.47 at the time.23
The sluggish property market during the Asian Financial Crisis also led FEO to stagger home launches and put some projects on hold. In August 1998, FEO signed the first mortgage-backed bond issue in Singapore. It was a S$162-million financing deal with Citibank, backed by mortgage and cash flow from Leonie Condotel, a luxury serviced apartment project on Leonie Hill.24
Notwithstanding the downturn, FEO reported total sales of S$8.2 billion in 1998, including those of its sister organisation, the Hong Kong-based Sino Group. A 60 percent jump in Sino Group’s sales to S$6.2 billion helped offset FEO’s 20 percent decline in sales to S$2 billion.25
Later developments
By early 2000, FEO was sufficiently confident of purchasing a site at Clarke Quay for S$340.8 million, which it then developed as a mixed-use development project. Named The Central, the project comprised retail outlets, offices and residences.26 Sino Group also developed the high profile Fullerton Hotel in Singapore, which was completed by 2001.27 However, FEO’s residential property sales in that year declined to its lowest in eight years, as it sold just over 800 homes. This saw its share of the home market, which stood between 25 and 40 percent for most of the previous years, shrink to 11.6 percent.28
From January to June 2002, FEO sold more than 300 homes out of its target of 1,000 for the year, and was hopeful that its share of the home market would pick up to around 25 percent. At the time, property sales made up 70 percent of the group’s revenue, while another 30 percent came from recurring income such as serviced apartment rents as well as commercial and industrial leases.29 FEO entered the healthcare sector in 2002 by developing Novena Medical Centre, located opposite Tan Tock Seng Hospital.30
In early 2003, FEO underwent a major corporate reshuffle that saw the creation of four new business groups: Listed Companies, Ventures and Industrial Business, Development and Corporate Leasing, and Retail and Lifestyle Concepts.31
Over the next few years, FEO shifted its focus to retail and commercial developments. The market leader of the residential property sector for most of the 1990s when the market was buoyant, FEO slipped behind several developers during the first few years of the 2000s.32 The group, however, thrived with high profile retail and hotel developments. It also consolidated its position in the industrial and office sectors. In addition, FEO began to re-establish itself on the prime Orchard Road belt by purchasing Pacific Plaza and other properties as well as completing the tallest retail development in Singapore, the S$650-million Orchard Central, in 2008.33 With stakes in Far East Plaza, Far East Shopping Centre, Lucky Plaza, Orchard Shopping Centre, Orchard Plaza and Orchard Parade Hotel as well as full ownership of Orchard Parksuites, Regency House, Elizabeth Hotel and other properties, FEO was the largest private property owner in the Orchard Road area in the 1970s and ’80s.34
The latter half of the 2000s saw FEO resuming its major land banking moves. In 2006, it spent around S$1.6 billion on land purchases, including acquiring more than S$800 million worth of collective sales plots for residential developments.35 As the residential market picked up, the group recorded about S$2.34 billion worth of sales in 2009.36
In recent years, FEO has launched luxury development brands, entered the restaurant market and unveiled plans to expand its mid-range hotel brand, Village Hotels & Residences, overseas.37
Image, marketing and awards
In the 1990s, FEO began its efforts to overcome the perceived lack of quality in its residential projects. The strategy, which included an advertising campaign, was aimed at changing FEO’s image from a developer of mass housing to a developer of quality and creativity. In 1994, the group became the first developer in Singapore to attain ISO certification for project management. Other initiatives to boost its image, quality and service included establishing a quality assurance and control unit. The group also began to embark on more upscale developments with themed designs that reflected lifestyle trends gathered through market research.38
FEO’s efforts led to a number of awards. In 1999, the group received its first FIABCI (International Real Estate Federation) Prix d’Excellence Award for The Bayshore development.39 In 2010, it received the sixth Prix d’Excellence Awards for The Central at Clarke Quay.40 The group also bagged the Urban Redevelopment Authority Architectural Heritage Awards in 1999 and 2001 respectively for the restoration of Far East Square and Fullerton Hotel, while its residential developments have consistently won the Building and Construction Authority Construction Excellence Awards.41
Author
Alvin Chua
References
1. Desmond Ng, “‘He Didn’t Dress Like a Rich Man’,” New Paper, 3 February 2010, 2–3. (From NewspaperSG)
2. “Inspire Better Lives,” Far East Organization, accessed 30 May 2017.
3. Tan Su Yen, Landmarks: 50 Years of Real Estate Development (Singapore: Far East Organization, 2010), 10. (Call no. RSING 333.33095957 TAN)
4. Leo Suryadinata, ed., Southeast Asian Personalities of Chinese Descent: A Biographical Dictionary, vol. 1. (Singapore: Institute of Southeast Asian Studies, 2012), 769. (Call no. RSING 959.004951 SOU)
5. Tan, Landmarks: 50 Years of Real Estate Development, 5; Wu Huimin and Chen Jinbai å´æ
§æ and éé¦æ, “Bendi shoufu huangtingfang shishi xiangnian 82 sui” æ¬å°é¦å¯é»å»·æ¹éä¸ äº«å¹´82å² [Local richest man Ng Teng Fong dies at age 82], Lianhe Wanbao èåææ¥, 2 February 2010, 3. (From NewspaperSG)
6. “Far East Organisation: Building an Enduring Enterprise,” in Far East Organisation, Landmarks: 50 Years of Real Estate Development (Singapore: Far East Organisation, n.d.), 2; Wong Kim Hoh, “The King of Orchard Road,” Straits Times, 3 February 2010, 1. (From NewspaperSG)
7. “Built for $5.5 Mil, Sold for $178 Mil,” Straits Times, 8 July 1983, 15. (From NewspaperSG)
8. “History and Milestones,” Far East Organization, accessed 30 May 2017; “Hotels Listed in a Separate Section,” Straits Times, 6 August 1968, 19. (From NewspaperSG)
9. Suryadinata, Southeast Asian Personalities of Chinese Descent, 770.
10. “Finance Company Moves Into New Office,” Straits Times, 29 December 1967, 12. (From NewspaperSG)
11. Far East Organization, “History and Milestones.”
12. Suryadinata, Southeast Asian Personalities of Chinese Descent, 769.
13. Desmond Ng, “He Looked Fierce but He Was a Generous Boss,” New Paper, 4 February 2010, 13 (From NewspaperSG); “Far East Organisation: Building an Enduring Enterprise,” 6, 9.
14. Suryadinata, Southeast Asian Personalities of Chinese Descent, 769.
15. Doreen Siow, “Rushing To Build Up Land Banks,” Straits Times, 16 May 1993, 4. (From NewspaperSG)
16. Kalpana Rashiwala, “No Liquidity Crunch, Far East Figures Show,” Straits Times, 17 January 1998, 88. (From NewspaperSG)
17. Kalpana Rashiwala, “5 Far East Projects Among Last Year’s Best Sellers,” Straits Times, 16 February 1998, 42; Tee Hun Ching, “Interesting Developments,” Straits Times, 8 June 2002, 6. (From NewspaperSG)
18. Tan Su Yen and Lee Han Shih, “Is the Bull Running Out of Steam?” Business Times, 29 March 1995, 44. (From NewspaperSG)
19. Tay Kay Poh, “Visitors Ensure Rosy Outlook for Serviced Apartments,” Business Times, 29 March 1995, 48. (From NewspaperSG)
20. Lee Han Shih, “YHS Battle Hots Up As FCC Moves To Boost Stake Further,” Business Times, 28 March 1995, 1; Goh Soo May, “Charles Yeo Joins Forces With Quek Leng Chan-Led Consortium,” Straits Times, 31 July 1995, 32; Genevieve Cua, “Teng Fong Wins YHS Fight, Quek Leng Chan Accepts Offer,” Business Times, 13 September 1995, 1. (From NewspaperSG)
21. “Ming Court Proposes Change of Name to Orchard Parade Holdings,” Business Times, 29 May 1990, 3; Lee Han Shih, “Orchard Parade May Be Spearheading Teng Fong's March Into Manufacturing,” Straits Times, 10 June 1994, 17. (From NewspaperSG)
22. “Sino Group Reaps HK$12B from Sales,” Straits Times, 27 July 1998, 42; Clarissa Tan and Lilian Ang, “Far East Property Sales Hit S$2.5B Last Year: CEO,” Business Times, 17 January 1998, 1. (From NewspaperSG)
23. Rashiwala, “No Liquidity Crunch, Far East Figures Show.”
24. Diana Oon and Clarissa Tan, “Far East’s S$162M Loan Includes 1st Mortgage-Backed Bond Here,” Business Times, 26 August 1998, 2. (From NewspaperSG)
25. Conrad Raj, “Ng Teng Fong’s Total Sales Hit S$8.2B Last Year,” Business Times, 14 April 1999, 1. (From NewspaperSG)
26. Francis Lim and Amy Khor, “$2.5B of Investment Sales and Still Counting,” Business Times, 27 April 2000, 80. (From NewspaperSG)
27. Braema Mathi, “PM: Fullerton's Come a Long Way,” Straits Times, 1 January 2001, 1; Tee Hun Ching, “One Up,” Straits Times, 16 September 2001, 6. (From NewspaperSG)
28. Tee, “Interesting Developments.”
29. Kalpana Rashiwala, “Far East Poised To Regain Market Share,” Business Times, 1 June 2002, 1. (From NewspaperSG)
30. Vince Chong, “Far East Ventures Into Healthcare,” Business Times, 29 November 2002, 7. (From NewspaperSG)
31. Vladimir Guevarra, “Far East in Major Shake-Up,” Straits Times, 11 February 2003, 19. (From NewspaperSG)
32. Landmark: An In-House Publication of Far East Organization (Singapore: Far East Organization, 1994), 11. (Call no. RSING 333.33095957 L)
33. Joyce Teo, “Far East Set To Build Tallest Mall in S’pore,” Straits Times, 23 August 2006, 2 (From NewspaperSG); A. Gan, “Offshore: Orchard Central Expects 85% Opening Take-Up,” Edge Malaysia (Weekly), 10 November 2008. (From Factiva via NLB’s eResources website)
34. Landmark: An In-House Publication of Far East Organization, 4.
35. Kalpana Rashiwala, “Far East Top Buyer of En Bloc Sites,” Business Times, 1 December 2006, 13. (From NewspaperSG)
36. “City & Country: Singapore – Competition Heats Up,” EdgeProp, accessed 3 June 2017.
37. Joyce Teo, “Far East Gears Up To Go Regional,” Straits Times, 29 October 2009, 53. (From NewspaperSG)
38. Stephanie Yeo, “Far East Overhauls Image With $5M Blitz,” Straits Times, 9 May 1994, 4. (From NewspaperSG)
39. Tan, Landmarks: 50 Years of Real Estate Development, 21.
40. Ephraim Seow, “Far East Wins 6TH Fiabci Award for Central, Today, 28 May 2010, 47 (From NewspaperSG); Far East Organization, “Four Far East Organization’s Developments Awarded at FIABCI Singapore Property Awards 2017,” media release, 6 October 2017.
41. Corrine Kerk, “Far East Sq, Capital Sq Get Heritage Awards,” Business Times, 8 July 1999, 4; Vince Chong, “7 Architectural Heritage Winners,” Business Times, 19 July 2001, 20 (From NewspaperSG); Teo Pau Lin, “Far East Goes West,” Straits Times, 24 May 2001. (From Factiva via NLB’s eResources website)
The information in this article is valid as at 2010 and correct as far as we are able to ascertain from our sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.
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