Morgan Stanley PE Asia co-leads $100m Series C in Chinese apartment rental firm QingKe

QingKe
The corporate logo of financial firm Morgan Stanley is pictured on the company's world headquarters in the Manhattan borough of New York City, January 20, 2015. REUTERS/Mike Segar

A fund managed by Morgan Stanley Private Equity Asia has co-led the more than $100-million Series C funding round in Chinese long-term rental apartment services firm QingKe, according to a statement.

The Morgan Stanley fund joined consumer sector-focused private equity firm Crescent Point in leading the investment round, which also saw participation of investors in previous funding rounds, including SAIF Partners, Fortune Capital, and Newsion Venture Capital.

QingKe, founded in Shanghai in 2012, is the first investment by a fund managed by Morgan Stanley Private Equity Asia in China’s long-term rental apartment market, said Ryan Law, Managing Director at Morgan Stanley Private Equity Asia.

QingKe provides decentralised long-term rental apartment in China. Managing more than 70,000 rental units, Qingke leverages a wide array of Internet and IoT technologies “to achieve management and operation efficiency and effectiveness”.

“We are optimistic about this trillion-yuan market segment … and we believe that QingKe will remain a high-growth industry leader domestically and expand its footprint overseas,” Law said.

Morgan Stanley PE Asia specialises in privately negotiated minority investments in companies with substantial business operations in the Asia-Pacific region.

Lin Lin, managing partner at Crescent Point, said the long-term rental apartment market is very promising and that QingKe’s business model and core competitiveness “are well established”.

Crescent Point, a private equity investment firm, is focused on consumer services, travel, the Internet and other consumption upgrade related sectors in the Asia-Pacific.

QingKe delivered a strong performance with occupancy rate at 95 per cent. Targeting young individuals, the company now has presence in Shanghai, Beijing, Hangzhou, Nanjing, Wuhan, Suzhou, and Jiaxing.

“From day one, QingKe has been continuously improving our efficiency, operations, and services by leveraging information and Internet technologies, in an effort to provide convenient residential services at best price to young people living in big cities,” Jin Guangjie, founder of QingKe, said.

China’s long-term apartment rental market is very promising. According to China’s Orient Securities, the market reached Rmb1 trillion ($158 billion) in 2015 and is expected to grow. A Jones Lang LaSalle executive estimates that online penetration in this industry remains at single digits.

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