SINGAPORE &ndash The appointment of two independent directors earlier in 2025, which played a key role in a recent public spat between the father-and-son team in charge of City Developments Limited (CDL), continued to cast a shadow on the firm.

 

At the hotel and property group&rsquo s annual general meeting on April 23, Mr Philip Yeo, a CDL board member since 2009 and a respected veteran civil servant who has served on many boards, voiced his unhappiness over how Ms Jennifer Duong Young and Ms Wong Su-Yen were appointed.

 

&ldquo I am very unhappy... I am very disappointed over the way the two new directors were appointed,&rdquo said a clearly agitated Mr Yeo, who added that there was no reason for the hasty appointments at a time when the nominating committee chair, Mr Chong Yoon Chou, had to rush to Malaysia to tend to his sick father. 

 

&ldquo So, therefore, I am of the view that the two directors should not be appointed,&rdquo he said.

 

Billionaire property tycoon Kwek Leng Beng, 84, who is executive chairman of CDL, had in February accused his son Sherman Kwek, 49, the firm&rsquo s chief executive officer, and a group of directors of an attempted coup to oust him. 

 

Mr Sherman Kwek has denied any attempt to oust the chairman. Instead, he blamed Dr Catherine Wu &ndash who has a long relationship with his father &ndash for the dispute, as she &ldquo wields and exercises enormous influence&rdquo .

 

Mr Yeo&rsquo s outburst was witnessed by around 450 CDL shareholders who had packed two rooms at the M Hotel in Anson Road, as well as others who had tuned in to the hybrid AGM. This is the first time CDL had to prepare an &ldquo overflow room&rdquo in anticipation of a larger turnout.

 

Some shareholders said they were at the AGM in hopes of seeing a united CDL. It was the first public event the father and son attended together since the spat.

 

&ldquo I am here to see if Kwek Leng Beng and his son have really moved on and are on talking terms,&rdquo said one shareholder, who wanted to be known only as Ms Lim.

 

But she was disappointed as the two men hardly interacted even though they sat together.

 

The AGM had started on a solemn note, with the chairman &ndash clad in a grey suit and pink tie &ndash convening the AGM and Mr Sherman Kwek going through the financials before Mr Yeo spoke up.

 

Mr Yeo said in the companies he has been involved in, local and overseas, directors do not overthrow the chairman, prompting applause by shareholders in the ballroom.

 

&ldquo It must be consensus and not disregard for the chairman,&rdquo he said, emphasising the importance of unanimity among board members.

 

&ldquo Going forward, there must be good governance so that this cannot happen again, where the majority can bully the minority. I want to register my unhappiness,&rdquo Mr Yeo said, to another round of applause.

 

One shareholder, Mr Chew Sutat, who retired from the Singapore Exchange (SGX) in 2021, said that when it comes to board matters, the majority does rule.

 

Despite Mr Yeo&rsquo s comments, all five of CDL&rsquo s independent directors who were up for re-election &ndash including Ms Duong Young and Ms Wong &ndash were reappointed.

 

The company currently has 11 board members, including Mr Kwek Leng Beng and Mr Sherman Kwek.

 

Speaking to The Straits Times after the results were announced, Mr Yeo said he still has concerns. &ldquo Yes, there is still a fundamental problem.&rdquo

 

Mr Kwek Leng Beng told ST he was &ldquo very happy&rdquo with the outcome.

 

&ldquo Look at it from a long-term perspective. Rest assured, I am very confident. Now we can look at the bigger picture,&rdquo he said.

 

ST had reported that senior establishment figures in Singapore intervened and mediated a truce that put a halt to the acrimonious boardroom fight which had raised eyebrows within the region and in the UK, where CDL also has investments.

 

On March 12, Mr Kwek Leng Beng withdrew his lawsuit, which was intended to stop his son and majority directors of CDL from implementing a number of board resolutions and restrain the two new independent directors from exercising their powers. 

 

Shareholders, who have seen CDL&rsquo s share price sink to historic lows during the feud, clamoured to know the company&rsquo s growth plans, and expressed hope that the company buys back its shares to help boost confidence. 

 

One shareholder said: &ldquo It is time for the board to re-embark on its share buyback programme.&rdquo

 

&ldquo Judging from the interaction here, I have my doubts as to how the board can move forward, given the diversity of views,&rdquo said another shareholder. 

 

Mr Sherman Kwek said the key priority in 2025 will be to accelerate CDL&rsquo s capital recycling initiatives so that it can cut its interest expense burden which has ballooned to almost $600 million, and use the proceeds from divestment of non-core assets to deploy into new acquisitions.  

 

He also said CDL will re-explore the real estate investment trust listing of its UK commercial assets on the SGX when conditions are right. CDL shelved the listing plan in late 2022.

 

City Developments Limited (CDL) CEO Sherman Kwek says plans for a REIT IPO of its UK commercial assets, which were shelved in late-2022, are back on the table.

 

Speaking at CDL' s 62nd annual general meeting on April 23, Kwek says the move would have added some $3 million in assets under management to the group' s fund management business had it gone ahead.

 

The developer applied to list a REIT on the Singapore Exchange ' s Mainboard in 2021, reportedly with two commercial buildings.

 

Bloomberg reported then that the IPO could raise some GBP500 million in a 3Q2021 debut, with a portfolio size of about GBP1.8 billion.

 

However, CDL did not go ahead with the listing, citing a challenging market and an " unprecedented interest rates hike" in 2022, according to its financial statements for FY2022 ended Dec 31, 2022.

 

CDL had acquired Aldgate House from a joint venture of Hermes Investment Management and the Canada Pension Plan Investment Board for GBP183 million in September 2018. The following month, CDL acquired 125 Old Broad Street from Blackstone for GBP385 million.

 

CDL acquired a third UK commercial asset, St Katharine Docks in central London, for GBP395 million in March 2023.

 

Kwek notes that CDL now has three properties in the UK. " When conditions are right, it is something we would like to explore again," says Kwek to a packed ballroom at M Hotel Singapore City Centre, which was also livestreamed to an overflow hall at the same hotel and to virtual attendees.

 

As at end-2024, CDL' s UK commercial portfolio reported a committed occupancy of 79.5%, pulled down by several tenants vacating their premises at 125 Old Broad Street, Aldgate House and St Katharine Docks.

 

" However, with over 153,000 sq ft of renewals/lettings achieved in 2024, occupancies are expected to stabilise and start trending up again," says CDL in its FY2024 annual report.

 

Kwek notes that some developers in Singapore have done a " really good job" of creating fund management platforms, but CDL has had " a slower start" .

 

Kwek envisions selling assets into funds where CDL will " have a small stake" , thereby giving the group " good recurring income" .

 

According to CDL' s latest annual report, the group is focused on pursuing its fund management strategy through organic and inorganic growth.

 

CDL says it owns a " sizeable" UK commercial and purpose-built student accommodation (PBSA) portfolio, and Japan private rented sector (PRS) portfolios across Tokyo, Osaka and Yokohama. These generate " stable" recurring income, adds the group.

 

" Amid a challenging market environment marked by volatility and geopolitical risks, the group remains committed to recycling these balance sheet assets for organic growth and scaling up its fund management platform, both via public and private platforms," says CDL in its annual report.