The New Faces of Real Estate and How They Were Raised Up

Real estate development in the country has always been dominated by just a few big names.
We have the Sys who own SM Prime Holdings Inc, the Gokongwei-owned Robinsons Land Corp, the Ayalas who own Ayala Land, the Villars who own Camella Homes, the Tans of Megaworld, and the Tys of Federal Land.

Looking at this list, we see that 2019 has seen the passing away of some of the patriarchs of these families such as Henry Sy, John Gokongwei Jr., And George Ty. While these patriarchs may have passed away, their legacies still remain intact and their conglomerates still continue running. Below we look at some of the things these patriarchs did in terms of succession planning and what other real estate magnates and even business owners can emulate from them.

The Sys of SM Prime Holdings, Inc.
First we look at SM Prime Holdings, Inc. (SMPH) Incorporated on January 6, 1994 it is in the business of developing real estate, building and maintaing shopping malls, and to construct residential buildings, hotels, and office spaces.

As of December 31, 2018 the company has 72 malls in the Philippines, 7 malls in China, 44 residential projects, 13 office space complexes, 6 hotels, 4 convention centers, and 3 trade halls in its portfolio. Its subsidiaries include SM Development Corp., Costa del Hamilo, Inc.; Highlands Prime Inc.; Tagaytay Resort Development Corporation; SM Arena Complex Corporation; SM Hotels and Conventions Corp.; and SM Land (China) Limited.

Founded by Henry Sy, SM Prime Holdings, Inc. started out as a humble shoe business and slowly grew into the conglomerate it is today with interests spanning from the retail, malls, real estate, and even banking industry. For 11 consistent years, Sy has consistently been dubbed the richest man in the Philippines with
an estimated net worth of US $19 billion at the time of his passing.

With such a big estate, succession planning was important for Henry Sy. He noted that it is very common for family-controlled businesses to thrive in the first generation but fade during the second and third generations. As such, he instilled in his six children -Tessie, Henry Jr., Hans, Herbert, Elizabeth and Harley the value of hardwork. When they were just teenagers, the Sy simblings were already expected to spend their Saturdays working and understanding the business instead of having fun like other teenagers would normally do. Furthermore, all six of them were expected to join the family business upon graduating college. It is therefore no wonder that when Henry Sy passed away his children were already holding key positions in the SM Group and were ready to lead the huge SM conglomerate.

The Gokongweis of Robinsons Retail Holdings, Inc. and Robinsons Land Corporation
Next to SM Shopping Malls, the competitor that comes the closest to it would be the Robinsons Group owned by the Gokongweis. Robinsons Land Corporation was incorporated June 4, 1980 and is the real estate arm of JG Summit. Its portfolio boasts of having 51 shopping malls, 89 residential towers, 20 office buildings, and 23 hotels. Its hotels include both Crowne Plaza and Holiday Inn located in Galleria and also the Summit Hotel Group and Go Hotels.

Robinsons Group was founded by John Gokongwei Jr., who also had a similar rags-to-riches story as Henry Sy. Originally born into a well-to-do family, his family lost all their wealth upon the passing away of his father. This event prompted John to begin his entreprenuerial career with him having to peddle items such as soaps in his local market to support his family. With the help of a loan, he was able to set up a milling plant from which came Universal Robina Corporation. Like Henry Sy, he has stakes in malls, real estate and also telecommunications, financial services, food, and beverage industry.

When John Gokongwei Jr. passed away this year, his children shared tidbits of how John was as a father and how he made sure his children were ready to take over the family business one day.

John made sure that his children knew the value of hardwork. He is known for saying: "If you don't work, you don't eat." He also said: "If you don't start at the bottom, you won't know who your customers are, and you won't know the issues of your staff." It is therefore no surprise that he had his six children start from the very bottom before becoming the successful business leaders they are today.

He had his daughters - Lisa, Faith and Hope start out by tagging barcodes in their department store bodegas. His other daughter Marcia worked at the kitchen of their hotel as an assistant. Robina and Lance  both worked as receiving clerks at the department store bodega, which was the only area not airconditioned in the store.

They also recounted they never received cash during their birthdays and celebrations. What money they had, they had to work for. Lance recounts that when he started working in the family business, he was only paid P2,000 and his dad lent him an old car, a Datsun that didn't even have a working airconditon unit. Even though he was the son of the boss, he had to work harder than everyone else. Today, Lance Gokongwei is now the chairperson of both Universal Robina Corp. and Robinsons Land Corp. and runs both these companies.

The Tys of Federal Land
Another notable tycoon that passed away recently was George Ty. More famous for his stakes in Toyota Motor Corp. and Metrobank, he also founded Federal Land which is responsible for many large-scale developments in the country.

Unlike the two previous tycoons whose estates were divided without controversy, George's will which was written as of September 2015 was contested in front of the Makati Regional Trial Court on the basis that he allegedly married Lourdes Ty back in 1961 making her the legitimate spouse. With Lourdes, George hd a son named Anthony. The alleged marriage has repeatedly been refuted by John when while he was alive.

In 1965, George married Mary Ty and had four children with her namely Arthur, Alfred, Anjanette and Alesandra. He also had another daughter named Margaret Ty-Cham, who was disowned for causing dishonor to family name amassing a total of P2 billion in debt for issuing post-dated checks and kiting.

Nowadays the brothers Arthur and Alfred have taken over their family's empire. Arthur is the chairman of GT Capital while Alfred currently serves as the vice chair of Toyota and chairperson of Federal Land.

Back when Alfred was 11 and Arthur was 13, their father would make them work during summer vacations. They had to call people in the office and keep on dialing if the line was busy to learn the lesson of perseverance. They also had to report to office at 7:30 am back then. It is no wonder that these days the Ty brothers are known to going home later than other executives and staff.

Overarching Themes
Overall, we can see that these real estate magnates trained their children early on at a young age by immersing them in the family business to increase their understanding and to teach them life lessons. It is important for other business owners to emulate these taipans and learn from how they were able to raise up competent successors to take their places someday.