A gondola lift system connects different parts of Ocean Park and is enormously popular

In September 2008 Dr. Allan Zeman stunned Hong Kong by renouncing his Canadian citizenship and taking a Hong Kong passport because, he said, he had lived in the city for 38 years and considered it his home.

And “home” is also the headquarters for his entrepreneurial empire. When you give your business card to Allan Zeman, he gives you three in return, one of them with 10 of his companies listed on it. This simple gesture gives an idea of the extent of Dr Zeman’s business interests, although he is perhaps best known as Chairman of Lan Kwai Fong Holdings, the company through which he has driven the development of the Lan Kwai Fong district of Central Hong Kong into a vibrant bar and restaurant scene. Not for nothing is he known as the King, or Father, of Lan Kwai Fong.

Dr Zeman is also chairman of Ocean Park, the sprawling theme park on the south side of Hong Kong Island that under his leadership has gone from strength to strength, confounding the pessimists who predicted the park would never survive competition from Disneyland on Lantau island.

And he is a director of Wynn Resorts, the Las Vegas-based developer and operator of high-end hotels and casinos, including the 20-storey hotel and casino in Macau which is proving more resilient than some of its rivals in the face of the economic downturn.

That downturn has not seriously affected business at the Hong Kong government-owned Ocean Park, which has recently announced record revenue and broken its attendance record for the fifth consecutive year with more than five million visitors.

Zeman said the attendance figures were “still OK”, with some reduction in the FIT (fully individual travellers) numbers but with the tour group sector still similar to last year. “In general we are pretty good.”

Ocean Park is also pressing ahead with a five-year, HK$5.5 billion expansion plan that includes three hotels – a project that has drawn an outcry from residents of the neighbouring upscale Shouson Hill district, who have concerns, among other things, about what the hotels will do with their splendid view of the South China Sea.

Zeman, who says “everybody likes to complain”, says the concerns are unfounded. Two of the hotels are in fact far out of sight from Shouson Hill, and the third, which he has ordered to be reduced from 16 storeys to just seven, will be built in the current car park and be shielded from view by a screen of trees. “At the moment residents are looking at an ugly parking lot. No one will see the hotel as there will be trees in the way, a beautiful green patch of trees.”

As he says, every theme park in the world has hotels. The two at Hong Kong Disneyland are proving popular. Hotels increase the length of stay by visitors, help with the business model and generate more cash. “Listen, it’s going to be a tougher year, obviously, with the recession. So I’m trying to get extra sources of income.”

Developers will build the hotels, which have still to get formal government approval, and split the profits with Ocean Park. “It sounded like a very viable thing for Ocean Park, because if Ocean Park loses money, the public is going to have to pay.”

Expanding LKF footprint
As for his own property empire in Lan Kwai Fong, Zeman said he was looking at possibly re-developing his two adjacent office buildings, California Tower and the California Entertainment Building, to free up more space. Typically, he says, economic downturns like the Asian financial crisis, which struck after Hong Kong was handed back to China, affect his bar business by only about 5 to 8 percent – “people tend to drink cheaper, but more.” Restaurant business gets affected about 10 to 15 percent, “but the profits come from bars generally”.

The SARS epidemic in 2003 was much scarier, he said, because people didn’t want to meet each other. “It really turned man against man. People weren’t even touching the lift buttons. They were using their elbows.”

The famed Lang Kwai Fong brand is about to debut in mainland China in the form of stylish fast-food noodle restaurants under the name of LKF Express. The first outlets are due to open in Shenzhen and Guangzhou in the next six months. “Once we do that, iron out the kinks, we will take (the product) throughout China.

“We are looking at noodles, which are very understandable in China and we will present the food in a way that is very meaningful – easy dining with style. I think we can grow it into a very strong business in China.”

Zeman is also in the process of signing a deal to open a shopping centre which is under construction in Chengdu, Sichuan province. The centre will have a Lan Kwai Fong feel about it, with bars and restaurants as well as shops. The deal came about after Chengdu officials came to Hong Kong seeking a buyer for the shopping centre. “Everybody wants Lan Kwai Fong in China,” he said.

He also said Chengdu was a very good retail market. “Although they do not earn a lot of money, they spend a lot. They really enjoy life.” Zeman is looking at a similar development in Guangzhou.

Zeman has what he describes as a very successful residential property development in Thailand. It’s a challenging venture because of the current political ferment in Thailand. But Zeman is sanguine. As he says, Thailand tends to experience such turmoil every few years, and still flourish. “Like the tsunami, if things stabilise, which I think they will, business will come back pretty quickly. Thailand is a place, Phuket especially, that people want to love.”

He is not so optimistic about the short-term prospects for Hong Kong and the Mainland. He believes these economies will get a lot worse before improving. As the meltdown started in the United States before spreading around the world, the recovery will have to begin in the US. “Hong Kong and China were a laggard when the recession first hit because it takes a season or two to travel this far. And we will be a laggard in the recovery – it will take a season or two.” In the first and probably the second quarters of 2009, jobs will continue to be lost. The Hong Kong property market will come down to levels that are ”understandable, affordable, then the cycle will start all over again, possibly at the end of 2009 or early 2010.”

Zeman said his own companies, which are not publicly listed, were fortunately positioned to ride out the storm. “When things were really crazy, really high, I was really nervous. I didn’t understand the property prices at those levels so we really didn’t take on a lot of debt at that time.”

He attributed the global meltdown to the rampant deregulation under the Bush administration, giving free rein to market forces. “Unfortunately, as we found out, that works in an up market” and not when financial markets spiral downwards. “You had a ship without a captain.”

Now a captain has been found in the shape of Barack Obama, and Zeman paid tribute to him as dynamic, young, eager for change, and who had surrounded himself with an A-list team of cabinet members and advisers. He predicted that under Obama a further stimulus package of US$500 billion would be announced that would put money back into people’s pockets and purses. “It will be a little bit of fire re-kindled.”

Let’s pull together
Hong Kong Business interviewed Zeman, who is often rumoured to have political ambitions in Hong Kong, on the same day that former top civil servant and legislator Anson Chan unleashed another blistering attack on the Hong Kong government for its series of missteps, calling it a dysfunctional government that lacked leadership.

Zeman agreed there had been missteps and flip-flops, starting with the controversial nomination of highly paid political appointees in the civil service. But he added that knowing the government personally – he refers to Chief Executive Donald Tsang and others by their first names – their heart is in the right place, they are not corrupt and they are not out to deceive the Hong Kong people. “But they have a PR problem. They absolutely do not know how to present their case to the public, they don’t know how to present themselves to the public, and when they do they get misconstrued, things get misreported.”

But he disagreed with Mrs Chan over her public assaults. “Attacking the government doesn’t really help the government. This is the time to pull together.”