Xu Jiayin, the chairman of Chinese real estate developer Evergrande, was revealed this week as the buyer of a A$39 million (US$33.4 million) mansion in one of Sydney’s most exclusive neighborhoods following a record-setting transaction.
The purchase by the flamboyant billionaire comes as his company diversifies away from its core business in Chinese mid-market real estate including a reported search for property development opportunities in Australia.
Xu, who also is known by his Cantonese name, Hui Ka-yan, was rated by Forbes recently as China’s 15th wealthiest person, with assets estimated at $5.9 billion. However, some critics have said that the success of the billionaire’s property business is due to relationships with a brother of former Chinese Premier, Wen Jiabao.
What Xu Got for His $33.4 Million
Villa del Mare, the home that Xu reportedly purchased last month, is positioned to take full advantage of panoramic harbour views, and features a pool table that retracts automatically into the floor.
The limestone palace sits on more than 1500 square metres of land and its sale for A$39 million set a record for purchase of a non-oceanfront residence in Australia, eclipsing a price point set by another Chinese buyer in 2008.
The home is located in Point Piper, a section of Sydney that is becoming increasingly popular with Chinese billionaires seeking homes outside of the mainland. Xu’s new neighbors will include Zeng Wei, the son of China’s former vice-president Zeng Qinghong, and Qiu Yafu – chairman of global textiles group Shandong Ruyi.
Evergrande Gets Interested in Australia
The new home purchase comes as the boss of the Chinese real estate developer shows increasing interest in new businesses, and in particular the Australian market.
Just last month the Sydney Morning Herald reported that Xu had taken a private Airbus A319 into Australia to look at real estate development projects there, and also during October Evergrande launched its own infant formula brand after buying a New Zealand dairy firm earlier this year.
Also in the last year, Evergrande has launched its own bottled water brand, set up new businesses in the grain and agricultural processing sector, and revealed a joint venture hospital business affiliated with Harvard University.
The company is also widely known for its ownership of Guangzhou Evergrande football club, which it now co-owns with Alibaba magnate Jack Ma.
Putting Real Estate Profits into New Sectors
The capital for all of these new businesses comes from the mainland real estate business that Xu built, some say in cooperation with the brother of the former premier.
The author of a book about Wen Jiabao reportedly said that Wen Jiahong – the younger brother of the government leader, had purchased 16 percent of Evergrande in 2001 for RMB 37.5 million.
A 2012 New York Times report on the wealth and business interests of Wen Jiabao’s family led to the company’s website being blocked on the mainland until this day.