The privately-held firm’s latest foray into the hospitality space – a $185 million makeover of The Beaufort hotel – targets luxury travelers and the conference market. In 2011, it converted an 87-year-old conservation property into Singapore’s first Sofitel.
“We have about 1.2 million square feet of land so we’ll add a few more roofs to it and that’s where we can unlock real value,” said Asok Kumar Hiranandani, chairman of Royal Group.
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However, it hasn’t always been smooth sailing for Royal Group. The redesign of Ogilvy Centre in 2011 – a heritage landmark nestled in Singapore’s business district – was among the firm’s most challenging projects.
“We told ourselves: ‘If we really want to win this [bid], we have to understand we are buying a piece of history on Robinson Road.’ I was going to pay more because I wanted it,” the elder Hiranandani said.
Royal Group outbid rivals by 24 percent. The property’s iconic landmark status added to the complexities of the development.
“There were restrictions by the URA (Urban Redevelopment Authority) and BCA (Building Construction Authority). Construction costs did escalate but at the end, we managed to come into budget,” said Bobby.
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The rise of Royal Group
The 67-year-old company, which has roots in textile manufacturing, is among Singapore’s most successful real estate firms. The family business was founded by Asok’s father, Naraindas Hiranandani. Together with his older sibling Raj Kumar, Asok maneuvered the firm into retail and later, real estate in 1985.
“Dad left us a good business but we [thought] we could do more,” Asok recalled. “[The property market] was dominated by Chinese but I guess we made a name in the fashion industry so we could buy up a fair bit of shops and rent them out.” Over the next decade, the Hiranandani brothers became known as “Kings of strata retail” for their ownership in malls along the city-state’s prime shopping strip, Orchard Road.
However in 2011, the siblings decided it was time to go their separate ways. The regrouping took six years and involved an asset swap worth nearly $1.4 billion.
“My family went crazy but I think one has to be pragmatic. We were brothers but it was never easy steering the ship together. If we are to add in two or four more captains, we got to have division,” said the Royal Group chairman. “I think both of us were capable of taking the Royal Group name to different levels. We can be separate [but] still be fabulous.”
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Looking beyond Singapore
Now, 59-year-old Asok who’s worth an estimated $1.3 billion is passing on the reins to his son. The young Hiranandani is eager to venture beyond Asia.
“We looked at all markets around Asia. Now we are looking at opportunities in Europe… maybe [even] America,” said 28-year-old Bobby.
Royal Group has made inroads into Indonesia and Australia over the past years. A resort property in Asia is currently in the works though they declined to reveal more details.
Asok remains squarely focused on Singapore.
“I can be in any country but Singapore will be headquarters. I believe Singapore still has a lot to offer.”
Royal Group unfazed by competition in Singapore