How Hotel 81 Founder Became A Billionaire With Budget Hotels PDF

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When we think of Hotel 81, the image of a sleazy ‘love hotel’ comes to mind.
This could be because Hotel 81 is dominant in Geylang – Singapore’s red light district
– with 8 out of its 25 hotels dotting the area.
Its seedy location would turn off most investors, but Hotel 81 founder Choo Chong
Ngen only saw the positive in the negative.
We only sell rooms; we don’t sell anything else.
“Red light district? The whole world has a red light district. You go any country, also
have one,” the self-made billionaire told Forbes in broken English.
The fact that he’s willing to brave risks and dabble in territories that others would
never dare to venture into made him one of Singapore’s top 20 richest
individuals last year.
https://vulcanpost.com/641112/hotel-81-founder-choo-chong-ngen/?fbclid=IwAR3RkqiZ62uBb9yViJvaUf7M0eFS1jnF0OyDfrge2QCJvOampsfc1ZPb12Q
school at age 14.
Chong Ngen had no choice but to give up school, and work at such a young age to help
support his family.
He had a taste of the working life since age 10 and dabbled in all sorts of jobs,

from selling ice cream in his neighbourhood to being a fishmonger.
When he was 15, he worked with a neighbour for his textile business, and got paid only
$30 a month.
The wage clearly didn’t suffice, so he turned the $50 his mother gave him into a
business capital – and borrowed another $6 – to buy cloth and start his own business
at the market.
At 21, he got a 10-year bank loan and pumped in his own savings to buy a shophouse
unit.
He rented it out and collected $1,000 to $2,000 every month, reinvesting these
earnings by buying more units.
By the time he was in his 30s, he had bought over 30 shop units, all generating rent.
From Propert Inve tor To Hotel T coon
His stay in a cheap business hotel in Tokyo back in 1991 inspired him to start up his
own hotel.
“The room was very small, and it was a very fair price. I thought this one bring to
Singapore, can make money,” he said in an interview with Forbes.
Three months after his return, he made his first foray into development and bought a
land in Geylang for S$1.5 million.
He built 20 apartment units on it, and gradually built over 100 apartment units spread
across four land plots in Geylang.
I started buying land 30 years ago, and I kept buying until now. If I didn’t
buy then, I wouldn’t be able to buy now because the price is very high.
“But 30 years ago, it was very cheap. I was very lucky.”
He noted a business opportunity and that’s when he decided to open his first Hotel 81
(the number ’81’ refers to the unit number of his home at the time).
Despite zero experience in the hotel industry, Chong Ngen made it a point to
familiarise himself by learning from other hotels, be it in Singapore or overseas.
“I learn and look at other hotels. I walk into every corner, and see how I can change
and improve on the design,” he told The Business Times.
He would conduct daily spot checks and think of ways to improve the design of the
laundry baskets and baggage trolleys to increase its efficiency.
In the past, he would also help out with housekeeping when they lack manpower.
“I’m 100% hands-on, not 99%,” he told Forbes.
Within five years, he had ten hotels under his name, mostly in Geylang and the
adjacent Joo Chiat neighbourhood.
Overcoming Compan Cri e
Over the years, Chong Ngen said that the company had faced all sorts of crises, but they
had stood strong and did not sell any hotel.
The 2003 SARS outbreak in particular, was a huge blow as it forced him to slash rates,
causing his business to “[drop] by 80%“.
Then during the 2008 financial crisis, he had made the sole bid of $51 million for a site
at Kallang Road.
But because of the crisis, banks levied a high commitment fee for financing, forcing
him to pay for the transaction in cash.
Two years later, that plot of land developed into his first V Hotel.
Looking back, Chong Ngen felt that the crisis turned out to be a blessing in disguise as
it resulted in lower land prices.
When the market is bad, land becomes cheaper. But hotels still make
money, so I keep investing.
He credits his cheap rates – rooms go for as low as $15 for a twohour stay, and

extends to $47 a night – as a critical factor that has helped keep business brisk.
He added that despite the increasing choices for consumers and the stiff hotel
competition in Singapore, his low rates kept guests returning to his hotel.
Moving Awa From The Red Light Di trict
Although Hotel 81 has established itself as a budget brand, it doesn’t actually have the
best image due to its Geylang heritage.
As such, Chong Ngen wants to move beyond Geylang and clean up its reputation as a
respectable budget brand.
He told Forbes that people tend to automatically think of Geylang when they hear the
name ‘Hotel 81’.
But if they take on a different name, they would be able to “catch different types of
fish”.
Leveraging on this opportunity, Chong Ngen decided to venture into opening more
hotel brands.
Besides Hotel 81, he now owns Value Hotel, V and Venue brands, Hotel Boss, as well as
four-star Hotel Mi.
But “Singapore is very small,” he laments to Forbes.
In a bid to capture more ‘fishes’, Chong Ngen made his first foray abroad in

Thailand, where he signed a management contract with the Travelodge group in
Pattaya and Bangkok last year.
Commenting further on his business expansion and growth over the years, Chong Ngen
simply revealed that business has been profitable as it raked in annual revenues of
around $145 million.
Hi Portfolio I Worth $3 illion
Today, the 63-year-old’s entire portfolio and investment properties is worth $3 billion.
This includes six hotel brands, 38 hotels, and 6,500 rooms.
Chong Ngen has restructured to put his various units under a newly-established
holding company – Worldwide Hotels – which is helmed by his daughter, Carolyn
Choo.
Carolyn is the group’s managing director, and she said that in line with the company’s
focus on the economy and mid-tier sector, they’ve acquired four hotels overseas.
The target is to acquire 20 hotels over the next five years, but they would need a

capital investment of over S$500 million, she added.
Accomplishing this goal is not easy, since the group is faced with all sorts of challenges
such as staffing, pricing, and competition from new entrants.
“The only way to survive is to pay attention. Think of better ways to run the business,
and become more cost efficient,” she told The Business Times.
Carolyn is now focused on helping the expand the business globally. In February, an
acquisition was completed in Malaysia, and another acquisition was pending in
Australia.
Chong Ngen also revealed that he has the funds to make acquisitions of up to

$300 million and is seeking expansion opportunities in Japan, Malaysia, Australia,
and the United Kingdom.
Alternatively, he intends to bring Hotel Boss overseas once he has found suitable
locations for it.
ducation I The Ke To ucce
Through the foundation, Chong Ngen pledged $2.5 million to five polytechnics to
establish an endowment bursary.
Each polytechnic is to receive $500,000 and the government will match the donation
by 1.5 times, bringing the total donation to each institution to $1.25 million.
I like to tell people to study. If you don’t study, it’s hard. You must study to
be successful. In this day, there are no such cheap buys and opportunities as I
had.
Featured Image Credit: Forbes / Hotel 81
We Went Through The Li t Of ’pore illionaire And

Found ome Intere ting Trend
Like Share Nicholas Goh and 69K others like this.
Of course they do. The tax relief is one of the best in the region; $1 donated =
$2.50 relief. Based on his assets and cashflow (and assumed his taxes), I
think he donated too little..
Like · Reply · 32w
Kelvin Ho
He only donate a mere $2.5M when he own billions - THIS GUY is a MISER !!!
Like · Reply · 2 · 39w
Marcus Tan
donate you KP, don’t donate you also KP. Arbo he donate his whole
fortune la. Better.
Brendan Avril Gontier

Wa Kelvin, how much have you donated?
Kelvin Ho
Marcus Tan you go convince him donate his whole fortune then
Show 3 more replies in this thread
Jovin Moy
Andrew Tang
Noel A. Kanaparthi
It might be broken English but it is flawless Singlish!
Amelia Ong
Syed Ismail
Jo Liaw
Jc JuNe
Lim Jong
sew
William Foo
It is the thought that counts and he made a lot of couples happy too !!!
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Like Share 4.1K people like this. Be the ﬁrst of your friends.

We only sell rooms; we don’t sell anything else.

He had a taste of the working life since age 10 and dabbled in all sorts of jobs,

From Propert Inve tor To Hotel T coon

“But 30 years ago, it was very cheap. I was very lucky.”

“I’m 100% hands-on, not 99%,” he told Forbes.

He credits his cheap rates – rooms go for as low as $15 for a two­hour stay, and

Moving Awa From The Red Light Di trict

But “Singapore is very small,” he laments to Forbes.

In a bid to capture more ‘fishes’, Chong Ngen made his first foray abroad in

Hi Portfolio I Worth $3 illion

This includes six hotel brands, 38 hotels, and 6,500 rooms.

The target is to acquire 20 hotels over the next five years, but they would need a

Chong Ngen also revealed that he has the funds to make acquisitions of up to

ducation I The Ke To ucce

We Went Through The Li t Of ’pore illionaire And

Like Share Nicholas Goh and 69K others like this.

Brendan Avril Gontier

Show 3 more replies in this thread

Facebook Comments Plugin

u cri e to Vulcan Po t New letter

Mahathir Call Mala Laz ,

The tor Of Gold Chili And Their

Car Rental Compan Launche Fir t-

Potrebbero piacerti anche

He credits his cheap rates – rooms go for as low as $15 for a twohour stay, and