Born and raised in Hong Kong, Colin has a first-class degree from Cambridge University and is also a CFA charterholder and is fluent in English, Japanese, and Mandarin. Prior to founding Kaplink Limited in 2012, Colin worked with CBRE’s capital markets and investments team advising clients on their real estate requirements, across all sectors.

What does Kaplink do, exactly?

We put together funds or projects for people to invest into, usually with a minimum of £100,000. You can think of us a bit like a syndicate, where a bunch of people with a similar investment outlook clubs together and we manage everything for you. We have several projects, for example a ground-up residential development in California, a credit pool backed by Hong Kong properties and a portfolio of prime London properties we are renovating. Residential is the one that pops up more often than not. We also have a great hospitality-based project, where we acquire an existing building, gut it, renovate it and reposition it as a midmarket hotel and then bring in a brand like Hilton or Best Western and organise an institutional disposal.

What advantages does Kaplink offer to real estate investors?

At the moment in real estate, investment expectations versus reality tend to be misaligned. You hear the success stories, but if you peel back the curtain a little bit the rate of successful investments is not as high as hearsay leads one to believe. We know that our family office clients are really good at making money in real estate, whereas individual investors struggle to generate a profit. My girlfriend’s mum comes to me every few months saying, “What do you think of this off-plan property in Kensington?” and I say, “That is not Kensington, for starters…” They are overpriced and don’t match what she wants, namely cash flow and capital appreciation. It dawned on me that individual investors actually don’t have much option when it comes to investing and no way of generating a return above and beyond what the market has to offer. What we seek to do is to generate alpha on top of the market beta, to make those institutional types of returns accessible for individual investors.

Where would you say your real strengths lie in property investment?

If you spend half a million pounds on one apartment you are exposed to a lot of concentration risk and are just hoping that the value of your unit goes up along with the market. Our strength is in picking the best on-the-ground partners to invest alongside. I may know them personally or have invested in them before, trust the calibre of their company and their ability to source whatever it is we want. I say, “Take your time, there’s no rush, let’s not do a mediocre job.” By picking the right partners, the advantage for the investor starts from acquisition and carries on through the whole process to exit, that results in really superior downside risk management. Even if there is a market wobble we believe our investments will outperform the market. Then there is the professional management of the investment, that really gives the investor peace of mind. No phone calls saying your tenants have had a big party and the management wants them out, or the toilet’s leaked downstairs. So when I look at all our projects I ask myself, would I put my girlfriend’s mum, or my mum, in this project as an investor? And trust me, if you knew these two women…

What sort of returns can be expected?

When I first looked at family offices I thought it was nuts that they have this minimum target of 15% Internal Rate of Return (IRR) while the rest of the market is happy to be making 5%. Then I realised that they just look at different deals. By clubbing together into a syndicate we can access those institutional type deals such as redevelopments and renovations. So now, we have one in New Zealand which we’re doing final due diligence on, where we are looking to get about 60% IRR over a two year project period. In London, anything from 8-12% is a great return. We want sensible meaningful risk reward profiles. As we tap into that family office network of deal-flow, these deals keep popping up and it is our job to sift through which ones stand up to scrutiny. I focus on the confidence level of these returns. I looked at one with an IRR of 18-20%, but when we just tweaked the assumptions a little that plummeted to 8-9%. On some deals, it really doesn’t take much to turn a really good-looking deal into a mediocre deal.

What sort of person would invest?

We can take on individual investors with £100,000 in equity all the way to family offices with £30 million plus. What you invest in this asset class should not be your entire life savings. That does not make sense from a financial planning point of view, simply because by its inherently illiquid nature it is classed as a high-risk product. You are in this for two to three years as a minimum, and depending on the project, up to seven years.

For invitations to events featuring this unique investment opportunity or for a personal introduction, contact us at: 

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16/F Chao’s Building | 143-145 Bonham Strand | Sheung Wan | Hong Kong
T: +852 3620 3157 | F: +852 3753 1811

16/F Chao's Building  |  143-145 Bonham Strand  |  Sheung Wan  |  Hong Kong
T: +852 33620 3157  |  F: +852 3753 1811  |  |  Data Policy  

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