#11 The Asian Mavericks – Mr. Jack Chua (APAC Realty Limited)
May 2, 2019
This is an exclusive interview with Mr. Jack Chua, CEO of APAC Realty Limited.
APAC Realty is the largest property agency in Singapore, with more than 6,000 active agents in Singapore. It operates under the branding of ERA, a property agency brand with more than 30 year history in the region.
Today APAC Realty is embarking on a regional expansion, opening up new agencies across the region. We sat down with Mr. Jack Chua to understand how he rose through the ranks within the company and successfully steer it into the massive agency it is today.
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Stanley: Hi! This is Stanley; from Value Invest Asia, welcome to our Asian
Mavericks season 2. This month, our guest is Mr. Jack Chua, the CEO of APAC
Realty; a listed company here in Singapore. APAC Realty today, is the largest property
agency in Singapore, with more than 6,000 agents in the country, and more than that,
it operates a franchise model under the name; ARA, and has more than 17,000
property agents across nine countries today. it’s an amazing story of how a
small boutique agency is able to grow over the past 30 years, to now becoming
one of the largest property agencies in Asia-Pacific. I have a wonderful talk
with Mr. Jack Chua, and I hope you enjoy it as well. So, here you go!
Jack Chua: Yeah! I’m Jack Chua, the CEO of APAC Realty limited.
Stanley: So, thank you Mr. Jack Chua for joining us, for
our Asian Mavericks season 2, and I just want to understand a little bit, about
how you actually rose through the ranks in this company.
Jack Chua: By myself…?
Stanley: Yeah! By yourself, and also let’s go back all
the way to the beginning, can you tell us a little bit about your childhood;
how was it like when you were growing up, were you a very mischievous kid?
Jack Chua: I think I’m normal, not something abnormal, I think
is just normal, because I came from a humble family, my parents were – my
father was a hawker. So, you grow up, I mean in Singapore HDB flat. So, I think I’m fortunate, because I think in
terms of studying, I’m quite okay, I am able to grab that thing, and able to
learn fast. So, in terms of result, it’s not too bad. So, I managed to secure
scholarship from the government; it’s called the PSC scholarship. So, to continue
my studies in the university, so after the University, of course I need to serve
my bond with the government. It’s a six-year bond with the government. So, I
went into public works department; which is in charge of all the public buildings
in Singapore. So, I started as – I mean my profession is a Quantity Surveyor. Quantity
Surveyor. Maybe people they are so calculative always deal with money, costing
and so on. So, this was a very good
training for me, so I did sensitive analysis in terms of overhead, in terms of
revenue, in terms of figures. Okay! So, I think it’s a good foundation. So, I
was in public works department for six years, because initially, I took care of
construction of building. So, I became part of the professional team, like we
have Architects, Engineers, Quantity Surveyors to take care of the project,
then later part of my stay in PWD; I took care of maintenance, including Istana
Jack Chua: So, I took care of the maintenance of all the schools,
all the public buildings. I was the head of building management. I did that for
Stanley: Wow! It’s quite an experience.
Jack Chua: So, after I served my bond, I thought that I should
go into the public sector. So, I looked around, looked for job, and I think it’s
a coincidence, that I got to know Harry Chua; who is the founder of ERA.
Stanley: I see.
Jack Chua: So, I decided to join them; not only as a staff, but
also as an agent. So, I got dual role.
Stanley: So, you were helping them operationally, and
also selling some of their property.
Jack Chua: Yeah! Because initially, the company is quite small,
we may only have maybe 20, 30 agents. It was a really very small set up, and
may not need a fulltime management staff. So, I need to also pay for my salary.
So, I also closed some deals during that initial period.
Stanley: Yeah! you talked about you joining the company right
at that infancy almost when it first started
Jack Chua: I must say that the ERA started way back in 1982, and
I only joined them in 1990. So, over the past few years (before I joined) I
think they also grow – only that maybe a bit slow.
Stanley: I see. Okay! can you maybe shed some light with us;
how was ERA at the very beginning, I understand that Mr. Harry took the franchise
ERA from the US.
Jack Chua: Yeah!
Stanley: But for real estate brokerage, why is there a
need to get a franchise in the first place?
Jack Chua: Okay! I suppose that if you go back to history way
back in 1982. So, Harry; who is the founder of ERA, he secured/acquired afranchise
from United States. So, that’s ERA.. I suppose at that point in time, he
emphasized a lot on training, because he feels that in Singapore, I think
there’s no structured training.
Stanley: I see.
Jack Chua: So, in real estate, for real estate salesperson. In
fact, the status of real estate agent is not that high at that point in time. Will
not be viewed as a professional agents, so
he decided to go to US, looked at some franchise that can provide a good
training. So, he secured the franchise, and brought it back to Singapore. We
started – in fact, I still remembered when I joined them in 1990, we did a lot
of training for the new agents. So, we have a structured fundamental training
for the real estate agents, teaching them from the basic knowledge of real
estate to some sales technique.
Stanley: Wow! Okay! So, the franchise comes with a complete
Jack Chua: Yeah! I mean, if you look at it, why he wanted to secure
the franchise is because of the training that the franchisor is able to provide.
Stanley: I see. Okay! That’s quite interesting.
Jack Chua: Yeah!
Stanley: But when you first joined the company; can you
share with us, how big was the company then, and what was the main business at
Jack Chua: We concentrated on real estate sales; in fact, most of
time we do a lot of private property resale which is then is the bigger market,
because HDB resale is still – I mean not so active at that point in time. So, I
mean, we provide training to the agent, just like we do a lot of recruitment
for the new agent, we provide training; train them, then put them under a
manager to guide them, then we start to grow from there. When I joined them in 1990,
we have about maybe about 20-30 sales person, in a small little office, and of
course today we are lucky, we have now grown to about 6600 agents in Singapore.
Stanley: Yeah! That is really amazing growth, and that’s really
what I think our audience is very interested in, how you actually grow the company
to such a significant size. So, when you first came into the company, maybe
share with us some of the things that you see as opportunities, and how you actually
helped the company grow quite significantly?
Jack Chua: I suppose that there are three keywords to it; it’s
the recruitment, and the training, and the retention. So, we were repeating
this three all the time, then we’re able to grow our company, because recruitment
is basically, we talk to the people,
encourage them or convince them to join the real estate agency industry.
To be an agent, and in this industry, I think is quite good for entrepreneurs,
because basically you’re like your own boss, because there’s no basic salary
offered, and then we go by commission split. So, the more you close, the more
money, the more income will be generated. So, that is one part of it, then of
course, the second part is the training, because we believe that training is
able to enhance your knowledge, enhance your skill. So, you’re able to provide
a better service to your customer. We have a lot of trainings, being how to do
a listing presentation, how to overcome objections, okay all this. So, we
provide trainings to the agents to empower them, and make them a better
salesperson. Of course, the third one is retention, we also don’t want after
you stay here for a while, you go and join others. So, we provide better
service, I mean the company, to retain the agent. There are two-fold to it; one
is providing service to the agent, the other one also provides products and
services that the customer wants. So there are two folds to it.
Stanley: So, can you elaborate a little bit on that how
do you provide service to the agent?
Jack Chua: I think agents basically we want them to concentrate
in the sales. So, the back-office thing that the company will do, and the
company will also do a lot of corporate awareness campaign, to make sure that
the public know about ERA. So, when you go into the customer’s house, you don’t
even explain what ERA is, they know that it is an agency. So, it’s what type of
services that you can provide to the customer. That will make that entry point
easier, of course to the customer, we educate the agent, basically – first in
service, first in result and first in customer satisfaction. So, that’s
important, we have to provide good service to the customer, then of course we
also show results. I mean good service without results is also of no use, and
then after that your customer is happy with it, and then there’s a lot referral
and business will come in. Then you can go on, and build a business from there.
Stanley: Wow! So, it seems that it’s almost built one
step at a time, and do you remember you know, is there any significant event
that kind of really opened the door up for APAC and ERA, like to bring you guys
to the next level, do you remember such a time?
Jack Chua: I suppose that, I think, business is for the long
term, we don’t look at short-term programs.
But for the long term, that’s why you have to build on very solid foundation.
So, I said that recruitment, training and retention. when you get that, you
repeat the process, of course you have to sharpen it. Because over the years,
we have to improve over it. Can you imagine last time, when we do advertisement,
it’s paper advertisement, but now, it’s mostly online. So, you also have to
improve your training, make sure the agents know what to do. So, it’s only to
sharpen all your skills, and you’re able to grow the business. If you can
recall, we were listed way back in 1998, under the Hersing Corporation, I
suppose that with the listing we were able to position ourselves in a leading position,
and you can elevate yourself into another level, because you are the listed
company. So, it’s the company that people can trust. So, because of that, we also
grow into that Asia-Pacific arena.
Stanley: Okay! Did you get the ERA like Asian tag franchise
straight away, or it was something that you acquired after a while?
Jack Chua: We acquired the Singapore franchise first, then we be
built from there, I mean we acquire the franchise way back in 1982, then it’s
only 1998 that we listed in the Singapore Stock Exchange, then after that, we acquired
the master franchise for the Asia-Pacific. If you ask whether any special event,
this can be one of the special events, that brought us to the Asia-Pacific level
from the local level. So, I mean now we have franchises from all over the Asia-Pacific,
I have about 17800 agents, across about 700 offices in ten countries. So, we
have Japan, we have Korea, we have Taiwan, we have Thailand, we have Malaysia, we
have Indonesia, then we have Vietnam, we have Cambodia, and also Hainan. Not
the whole of China, but Hainan island. And you know that lately we just announced
that we acquired ERA Indonesia and ERA Thailand. So, that is no longer my
franchisee, but our wholly owned subsidiary.
Stanley: Okay! is that something you’re looking at as well
in the future, where you can you can try to buy out some of your better
Jack Chua: I suppose that is the plan, because to build the
business will take time. Because in a country, if you want to create awareness,
it will take some time. So, if we acquire them, we are able to jump start. We have to look at the country, because we
hold the Asia-Pacific franchise for 18 countries now, now we will open up to 10,
we still have some more countries to go. So, I mean you know China is really a
big market, I think any of the cities in China can be bigger than Singapore. So,
we grow through this, I suppose that we are lucky, but there’s unlimited
potential for us to grow the business.
Stanley: I see, of the 18 countries you mentioned China, is
that the franchisee for the whole country, or is like just a few provinces?
Jack Chua: We hold the master (franchise) for the whole of China,
so is, our format can be I mean you know, China is so big,
Stanley: That you split up…
Jack Chua: Yeah! each of the cities can be like Singapore, just look
at Shanghai, the population I think I heard is 20 over million now – that is
five times that of Singapore, so actually there’s a lot of potential. So, that is
how we’re going to grow, but of course doing business in China is not easy…
Stanley: There’s a potential for you guys there. Okay! You
talked about the first listing back in 1998, and then after a few years, of course,
the company got delisted, do you want to share with us, the history or what is
the rationale for management to delist the company?
Jack Chua: We listed in way back in 1998, of course, at the point of listing,
I think ERA was the main business, and we were also on a few other businesses. And
along the way, of course, after the listing, we also started to acquire some businesses
like Western Union. We also acquired some interior design business and a storage
business. The company become a bit diversified, I mean if all the businesses are
in the real estate business it’s still not too bad, but it’s a bit too
different. The in 2012, the owner was a bit tired and wanted to sell ERA. But ERA
is a major contributor of the whole businesses. You can’t just sell ERA,
because it’s amounting to delisting. So, that’s why he decided to delist the
company, and 2013, he sold ERA.
Stanley I see. Okay! And he sold the company to a fund management business
called Northstar, can you tell us; how did that deal happen – did Northstar
come to you guys, or you guys were…?
Jack Chua: I must declare that for the deal, I’m not involved, because at that time, after the delisting, I think I more or less quit from the company, but I was still with the company but doing other business. I was the one that doing Tim Ho Wan. I was doing that business, selling dim sum! [Laughter]. , At ERA, there’s someone that succeeded me and taking care of things. I think it was quite interesting – instead of selling property, I went to sell bao [Laughter]. But it is a very good experience I must say. I suppose that doing business is all back to the fundamentals. Yeah! So, I’m lucky, I mean we also managed to have a good start, if you recall, people used to queue 2-3 hours just to buy bao. It was interesting and involved a lot marketing, you know, it’s just like marketing a property. So, we use Facebook, and others, to market the services of Tim Ho Wan. On the day of opening, I managed to attract a huge crowd, to our outlet in Plaza Singapura. So, the deal, actually I’m not so involved, after Northstar decided to acquire, they spoke to me. So, we had some meetings, and decided to get the management team, to participate in the buyout. So, there are 14 of us, myself, my CFO, my COOs are those involved in this buyout.
Stanley Lim has spent the last decade in the investment industry. Over the course of his career, he has kick-started a few businesses, worked in the family office industry and most recently in the investment advisory industry. He has been a writer and analyst for The Motley Fool Singapore from 2013 to 2017. He has written close to 2000 articles online, on investment education and market analysis. He is the co-writer of the investment book: “Value Investing In Asia”, published in 2018. Stanley is currently the chief editor of Value Invest Asia.