New World Development, owned by the billionaire Cheng family, is said to be considering replacing third-generation scion Adrian Cheng Chi-kong as chief executive after writedowns that led to the property developer's first annual loss in two decades.
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Cheng, 44, is poised to be replaced by chief operating officer Ma Siu-cheung, according to reports.
Such a move would be rare in the industry, where the biggest players are all controlled by families that carefully plan their succession.
Adrian Cheng's younger brother, Brian Cheng Chi-ming, said "everything will be cleared" after the company's results briefing at 4.30pm today.
Speaking at a results briefing yesterday for another family company, Brian Cheng added that their father, Henry Cheng Kar-shun, handles businesses case by case and fairly, instead of taking them personally.
The younger brother also said their relationship with their father remains harmonious.
Long assumed to be a favorite of the late patriarch Cheng Yu-Tung, Adrian Cheng had until recently been seen as the heir apparent of the family's conglomerate, which spans industries from property to jewelry and logistics.
Adrian Cheng joined the family's flagship developer in 2007 as an executive director and soon helped lead it before cementing his position as CEO in 2020.
A Harvard graduate with a stint at Goldman Sachs as an investment banker, Cheng has transformed the traditional property company into a brand with artsy apartment blocks and ambitious projects while accumulating heavy debt.
New World's debt level - the highest among its rivals in the past few years - has become a concern for investors amid high borrowing costs and a weak property market.
Its net debt to equity was 82.7 percent at the end of last year, compared with 41.4 percent at peer Henderson Land Development and 21.2 percent at Sun Hung Kai Properties.
Ma joined New World in 2018 and worked as an executive director and the chief executive of NWS Holdings until January 2024.
Before that, Ma was undersecretary for development from 2014 before being appointed as secretary for development in 2017.
Adrian Cheng has overseen large-scale commercial projects at New World. He created the K11 brand that incorporates art elements into malls and offices.
However, some of the projects began operating during inopportune periods. The flagship shopping mall K11 Musea, now a top retail destination for locals and tourists, opened in 2019 during the unrest before the pandemic shut borders.
Another mega project, a HK$20 billion shopping-and-entertainment complex at the airport, started opening in phases last year.
Its office space and shopping mall - set to be the largest in Hong Kong - may prove hard to fill as the city's office and retail sectors experience a prolonged downturn.
In 2021, the company found defects in the structure of two residential towers in Sha Tin and had to demolish the buildings while compensating buyers, further straining New World's finances.
Adrian's potential departure is reminiscent of an earlier piece of history at the company. Back in 1989, when his father Henry Cheng was new to the top job, he undertook an aggressive expansion of New World that left the company mired in debt.
Cheng Yu-Tung had to step in to carry out a series of asset sales to generate much needed capital.
Adrian Cheng's reputation spans beyond his position at New World. Arguably the most high-profile tycoon in Hong Kong, he is active on social media with more than 130,000 followers on Instagram.
His profile often shows him socializing with celebrities including Pharrell Williams and K-pop band Blackpink.
He has also taken up more public service roles recently. He leads the government's Mega Arts and Cultural Events Fund - which aims to attract large-scale events to the financial hub - as well as the Hong Kong Academy for Wealth Legacy that helps develop and promote the city as a global hub for the ultra-wealthy.
The family's succession plan was thrown under the spotlight last year after Henry Cheng said he was still looking for a successor for the family's conglomerate, shattering the previous assumption in the business world that Adrian Cheng would pick up the baton.
