Warburg takes apartment rental exposure into HK

Terms of the deal allow for the private equity firm to increase its commitment to as much as $413.5 million. Ownership stakes have not been disclosed. The capital will facilitate an expansion to more than 10,000 bedrooms in the next five years as well as the launch of new rental options targeting various demographics.

Weave provides shared living spaces to young adults that feature communal living rooms, movie rooms, kitchens, gyms, games areas, and laundry facilities, as well as regular housekeeping and full-time security. The plan is to build close-knit communities where aspirational millennials inspire each other to achieve their personal and professional goals.

According to a statement, Weave’s first property, which includes a community of 160 residents in Hong Kong, achieved 95% occupancy, with some 1,000 applications, or more than six times the number of bedrooms available, having been submitted within three months. The company noted that Hong Kong ranks among the least affordable cities globally with a median house price as high as 20 times the median household income.

“There is a fundamental shift in the way young people want to live, interact and experience a more fulfilling lifestyle,” Sachin Doshi, founder of Weave, said. “With serious affordability constraints and limited supply of quality rental apartments across many gateway cities in the region, collaborative living is an innovative, hassle-free way of urban living with all the perks and none of the pain points of traditional accommodation models – all at a value-for-money price.”

The deal represents Warburg Pincus’ first rental accommodation platform investment outside of mainland China. It follows participation in a RMB4 billion ($574.5 million) round for apartment rentals company Ziroom in January and the establishment of a RMB4.3 billion platform alongside Singapore GIC Private in May that will invest in apartments in China’s top-tier cities. Similar investments by the firm also include serviced apartment chain Mofang Gongyu.

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• Topics
• Greater China
• Real estate
• Early-stage
• Hong Kong (China)
• Warburg Pincus Asia