Tujia.com, the online apartment sharing platform, often referred to as China’s answer to Airbnb Inc, has raised $300 million in its latest funding round, that values the firm at more than $1 billion. The consortium of investors were led by Singapore developer Capitaland‘s wholly owned serviced residence business unit, Ascott, who have jointly put in $50 million into the Chinese home-rental site.
Others who joined the round include All-Stars Investment Ltd., an investment fund run by former Morgan Stanley analyst Richard Ji as well as Tujia.com’s exiting investors including, Ctrip.com International Ltd.
All-Stars Investment’s portfolio in China also includes Xiaomi and Didi (kuaidi).
Richard Ji, the founding partner of All-Stars Investment, said: “House sharing is one of the most popular ‘sharing economy’ models in the United States and Europe. China has the world’s largest tourist population, the world’s highest overseas tourism consumption, and the largest number of vacant houses in its domestic market, which form a fertile ground for the house sharing market. The house sharing economy features light assets and light services, with the growth rate and future scale likely far surpassing those for traditional hotels. As the leader of the industry, TUJIA offers high value proposition, diversified property choices, high customer retention, and powerful network effect.”
Tujia, that launched operations in December 2011, is China’s largest vacation rental website, and covers255 destinations in China and 133 destinations abroad, and has more than 310,000 properties online. It has also signed agreements with 170 government agencies, and entered into strategic cooperation with China’s top ten real estate development enterprises.
In addition to its investment in Tujia.com, Ascott will also form a joint venture with online apartment sharing platform with an initial capital of S$54.15 million ($40 million).
Led by Ascott, this JV will operate and franchise serviced apartments in China. It will also provide Ascott with a pipeline of apartments units to expand its portfolio in China where it targets to achieve 20,000 units by 2020. Ascott will also make available its three serviced residences – Ascott, Citadines and Somerset – on Tujia’s website for booking.
As part of its joint venture with Tujia, Ascott will operate serviced apartments located within the key growth cities of China using a new brand. This will include newly sourced properties and Tujia’s serviced apartments in China that are deemed suitable for conversion. Ascott is the largest international serviced residence owner-operator in China with over 14,000 apartment units in 77 properties across 24 cities.
In a separate development, CapitaLand said it had formed a new Technology Council consisting of high-calibre digital visionaries to boost its digital efforts to drive its real estate business. The members of this forum include venture capitalists Foo Jixun, managing partner of GGV Capital and David Su, Managing Partner of Matrix Partners China, as well as Gabriel Lim, CEO of the Media Development Authority of Singapore, the agency key to Singapore’s Smart Nation vision in mapping innovative infocomm media solutions. “Together, the council provides strategic critique of CapitaLand’s operations and insights to the digital universe,” the company said in a regulatory filing.
Lim Ming Yan, President & Group CEO of CapitaLand Limited, said: “CapitaLand’s technology drive is part of the Group’s efforts to sharpen our customer-centric focus to develop real estate of the future – integrated and interconnected smart communities through smart buildings as well as seamless online and offline customer experiences. We are privileged to have stellar tech visionaries join us in the CapitaLand Technology Council. With the wealth of experience and fresh perspectives of the council members, CapitaLand will gain much insight on using digital technology to decode the art of human needs and wants, so that we can create smart buildings for smart customers.”
“The council will also identify tech trends, challenges and opportunities to sharpen CapitaLand’s smart focus. CapitaLand’s investment in Tujia through Ascott, gives us the opportunity to expand into a new vertical which will augment Ascott’s core strength.” Lim added.