CHOW PENN NEE speaks to Lippo Group’s Stephen Riady whose business acumen has led the firm make several strategic property investments.
THE Lippo Group should be familiar to Singaporeans by now, with its brand name plastered on more than a dozen property developments across the island, and less obviously, behind the ownership of retailers Robinsons and River Island.At the helm of Indonesian conglomerate Lippo’s business empire in Singapore is Stephen Riady, whose entrepreneurial spirit is well known.
Mr Riady, executive director of Auric Pacific Group, clinched the Strategic Investment Entrepreneur of the Year award in Ernst & Young’s Entrepreneur of the Year Awards for Singapore this year. Among the criteria for the award are traits like strong financial performance, personal integrity and entrepreneurial spirit.
His group’s move into property has been strategic, given current, sky-high property prices, and the fact that he went into the market much earlier on.
‘We started off with the purchase of Lippo Centre on Shenton Way at the end of 2004,’ Mr Riady told BT in an earlier interview. ‘You think people come to us asking us to buy? No. We went out, and at that time, there were no bidders,’ he recounted.’ Wise investors are those who have a vision, they are the ones who see something that other people have not seen … Then they start taking action, instead of just waiting there.’- Stephen Riady, Auric Pacific Group executive director
The building has since been sold for $350 million - or more than double the $151 million purchase price - earlier this year. ‘There were signs that the Singapore economy was in good shape in 2005 and 2006, so we continued buying,’ he said.
Citing the hallmarks of a good entrepreneur, he said one must have the ability to understand timing and be willing to invest and take risks. ‘We should be willing to go outside our comfort zone.’
Recounting how he started investing in Singapore, he said: ‘When the Singapore government talked about plans to remake this place, lots of people heard about it. But we believed in it and took action early.’ And that, he says differentiates the wise investors from the foolish ones.
‘Wise investors are those who have a vision, they are the ones who see something that other people have not seen,’ he says. ‘Then they start taking action, instead of just waiting.’
Foolish investors, on the other hand, wait for opportunities to come but they still don’t take it, he said. ‘The opportunity leaves and then they say they regret not having taken it.’ The Lippo group has so far amassed nine residential developments, five commercial properties and two retail brands, with a total value of $4 billion in Singapore.
The Lippo group has so far amassed nine residential developments, five commercial properties and two retail brands in Singapore, with a total value of $4 billion.
Mr Riady hopes to go further, increasing the value of the group’s portfolio from $7US billion in assets at present to $20US billion within five years.
The group’s retail arm is also expanding aggressively. The business includes Auric Pacific - a distributor of fast-moving consumer food and non-food products, Robinsons, and various clothing stores.
‘The plan for our retailing business is to grow turnover from the present $2US billion to $5US billion in five years’ time,’ said Mr Riady.
His entrepreneurial instincts showed up early. Every school holiday, Mr Riady would return to the family business - set up by his father Mochtar Riady - to learn the ropes. The elder Riady started the Lippo business with a bank and has since built up a vast conglomerate spanning property, banking, and retail.
‘My dad didn’t say that I had to join the business, but since we already had it, somehow in university you just naturally major in business. You don’t think about it.’
He considers working in a family business advantageous as there is a ‘consultative environment in which both timeliness and calculated risk-taking strategies can be explored, discussed and implemented’.
‘To any entrepreneur, these two elements are key to the success of a business,’ he said.
At 46, the businessman is at the top of his game, and continually trying to improve. ‘A lot of people have mid-life crises because they get stuck and they are not inclined to grow or learn anymore,’ he said.
‘I really believe in growing because without growth, we will have crises and problems. We must train ourselves to learn.’
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