SUPPLIED
Clint Webber, left, John and Michael Chow have bought troubled building firm Stonewood Homes through their company Inno Capital.
Millionaire property magnates the Chow brothers say buying troubled building firm Stonewood Homes has brought them one step closer to managing a $1 billion property portfolio by 2020.
The company, New Zealand’s third-largest home builder, was placed in receivership on February 22, with 110 uncompleted homes and debts to unsecured creditors of around $15 million.
KordaMentha receivers Grant Graham and Neale Jackson confirmed the sale on Wednesday to Inno Capital, a company owned by the Michael and John Chow and finance specialist Clint Webber.
The Chow brothers, whose assets include commercial property, hotels and strip clubs, said the deal covered both the national franchise rights and the Christchurch franchisee.
Michael Chow said they approached the receivers as Webber had done business with them in the past.
“They knew that we had the capital and management to take on a deal of this size and make it work.”
The housing shortage in New Zealand was one of the main reasons they bought Stonewood Homes, Chow said.
“When the receivership news hit we had a good look and found that the main problem for the previous owner was cashflow.
“We have solid cashflow from our diverse property holdings and we have funding ability through our Inno Capital business,” he said.
“The deal became too good to say no to, so we said yes.”
The company would tie in with their other business interests, as they funded a number of residential subdivisions, Chow said.
“With Stonewood now under our umbrella we will look for opportunities to strengthen franchisees around New Zealand by funding Stonewood homes subdivisions.
“Who knows, we might even look at home finance packages as well.”
They hoped to grow Stonewood Homes into the number one residential home builder in the country, he said.
When asked if they felt slightly out of their comfort zone, Chow replied: “Not at all – we are risk takers but we don’t see Stonewood as a risk.
“Kiwis buy homes. New Zealand has a housing shortage. We have the cashflow and management to grow the business.
“The business is nationwide and capable of getting back on its feet very quickly. It became a bit of a no brainer for us actually.”
The Chow brothers now see themselves as a major player in the property industry, with an aim of managing a $1b of property by 2020.
“And we are supremely confident of getting there,” Chow said.
“Stonewood will be our priority for the next short while, but we have a great management team and Stonewood has some great and loyal staff, so as soon as possible we will hand back management control to the Stonewood team and look for our next big deal,” he said.
“We like what we see in Christchurch, so locals should not be surprised to see more of us soon.”
WHO ARE THE CHOW BROTHERS?
John and Michael’s family immigrated to New Zealand in 1984 from Hong Kong, and say they started their working life as teenagers, working in their parents’ takeaway food outlet in Courtenay Place.
From the first foray into commercial property, the brothers turned to converting other unoccupied buildings into car parks, warehouses and offices.
According to the Chows property remains the core business, making up 90 per cent of their assets.
Until Stonewood, the business revolved around revamping commercial buildings. This year they completed a reverse takeover of NZX-listed RIS Group (renamed Chow Group), and they say they plan to transfer most of their assets into the company.
The Stonewood purchase has been made through a separate company and is not part of to the listed company.
– Stuff