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May 21, 2023

Chayadi Karim Is Building Invictus Developments To Diversify

This story appears in the June 2023 issue of Forbes Asia. Subscribe to Forbes

This story appears in the June 2023 issue of Forbes Asia. Subscribe to Forbes Asia

The House of Tan Yeok Nee is one of Singapore's most iconic buildings, a low-slung traditional Chinese-style mansion built in 1885 and adorned with thick wooden beams and elaborate carvings, centered around an open courtyard with a koi pond. It's also a national monument with a premier location, a few minutes’ walk from The Istana, the president's official residence, in central Singapore.

While the building has had many owners in its long history, it is now held by Indonesian palm oil tycoon Bachtiar Karim, who shares an estimated $4 billion fortune with his brothers, through his family's Singapore real estate company, Invictus Developments.

The purchase of the house is part of the family's strategy to diversify out of palm oil, the main source of their wealth, and add a new money-spinner to a group of carefully curated properties across the Asia-Pacific. Sitting in a room that overlooks the koi pond, Bachtiar's 31-year-old son, Chayadi Karim, outlines his vision for Invictus: To build a portfolio of high performing and bespoke accommodation assets across the gateway cities in Singapore, Australia and Japan, with a focus on the hospitality sector.

Chayadi has already done much to realize that goal. Founded in 2018, Invictus has spent about $236 million since late 2019, and its holdings include a heritage hotel in Sydney and a serviced apartments building in Brisbane, with a new hotel opening soon in Singapore. Aside from the House of Tan Yeok Nee, Invictus has other properties in Singapore, where the firm is based, including the KINN Capsule Hotel, shophouses and industrial units. The family holds Invictus separately from Musim Mas Holdings, the major palm oil company run by Bachtiar and his two younger brothers Burhan and Bahari. Chayadi says Invictus now owns about $500 million in assets, with the goal to double that figure to $1 billion within five years.

And to make money from them. "I enjoy looking at heritage properties and, of course, owning them," says Chayadi. "But from an investment standpoint, it all boils down to the returns [on] the asset." In October last year, Invictus purchased another iconic building, the Harbour Rocks Hotel in Sydney, from Australian developer Robert Magid for A$40 million ($26 million). The hotel, which dates from 1887, is a few minutes’ walk from Sydney Harbour Bridge.

In October, Invictus purchased Harbour Rocks Hotel for A$40 million ($26 million). The hotel, which dates from 1887, is a few minutes’ walk from the Sydney Harbour Bridge.

Invictus funds its acquisitions with an undisclosed mix of family money and bank loans, according to Chayadi, who oversees day-to-day operations and makes key investment decision as the firm's principal. Chayadi says Invictus is currently looking to buy co-living properties in Singapore and elsewhere, and to enter the hospitality market in Japan and the U.K. "We are already placing bids for properties in Australia and Japan," Chayadi says later by email.

Chayadi plans to turn the House of Tan Yeok Nee into a mixed retail and office space with a high-profile anchor tenant once its current lease to Amity Global Institute, an educational institution, runs out at an undisclosed date. "We are particularly looking for timeless upmarket cafe concepts," he says. "Whether it is a brand already with a local presence looking for a flagship, or a new brand seeking to plant a flag in Singapore, we welcome these concepts." The property would also house Invictus, along with the entertainment and lifestyle businesses owned by Chayadi's older sister Cindy Karim, 32, and the Bachtiar family office, Harrison Asset Management.

"I enjoy looking at heritage properties and, of course, owning them," says Chayadi. Posing at the entrance of House of Tan Yeok Nee, he plans to turn it into a mixed retail and office space.

He early on displayed an interest in pursuing a different path from the family's palm oil empire. After graduating in business management from Singapore Management University in 2015, Chayadi briefly worked at a travel startup before entering the property business.

As toddlers in the 1990s, the siblings helped their grandfather, late Anwar Karim, pack soap at his soap factory in Medan, Indonesia, that eventually evolved into Musim Mas Holdings. In the early 2000s, Bachtiar and wife Dewi Sukwanto opened Mikie Holiday Resort, comprising a hotel, theater and theme park in Berastagi city, about a two-and-a-half hours’ drive from Medan.

"It was just a matter of time [before] my sister and I would eventually become a part of this entrepreneurship journey," Chayadi says. The family has experience running a hotel and knows "how to assess a successful hotel investment. So, we thought it is just a natural progression to enter the asset class [of property] first."

Invictus’ maiden purchase may prove to one of its savviest. In October 2019, it bought Darby Park Executive Suites for S$160 million ($117 million) from Singaporean billionaire Asok Kumar Hiranandani's Royal Group. The price was 72% higher than the S$93 million Royal Group paid to buy it from Sime Darby in 2018.

Despite paying a premium, the site's strategic location appealed to Chayadi. Situated at 12 Orange Grove Road, it is opposite the Shangri-La Singapore hotel and within a few minutes’ walk to the Orchard Road shopping district. "A site of that size and of that location is something that's hard to come by," he says. "We could take a cautiously optimistic approach toward the valuation and the prospect of this site."

Invictus is building a 143-room boutique hotel under The Standard brand (artist's impression left), the first for the chain in Singapore. Its Australian portfolio includes Quest Woolloongabba (right) serviced apartments in Brisbane.

With Covid-19 still unheard of, hotels were doing well in Singapore in late 2019, notes Chayadi, adding that the pandemic shielded Invictus from operating losses in the following years. "We were still in the design stage, so we weren't affected," he says. Invictus tore down the property and is redeveloping it to debut a 143-room boutique hotel under trendy The Standard brand, the first for the chain in Singapore, which is slated to open by early 2024.

Invictus Developments’ Australian portfolio includes Quest Woolloongabba serviced apartments in Brisbane, which it acquired this March for A$43.8 million from Pellicano Group. The 132-key property is situated near the Brisbane Cricket Ground, one of the venues for the 2032 Brisbane Olympics.

Bachtiar, 65, says he is glad to have encouraged his two children to explore interests beyond the palm oil business. "For me, the important thing is to lower the sense of entitlement and raise the sense of responsibility," the chairman and CEO of Musim Mas Holdings says by email. "I do this by giving them the space to pursue their dreams and aspirations, while guiding them toward responsible decision making in their choice of businesses."

Cindy Karim