FB Pixel no scriptShimao Property subsidiary gets USD 244 million from Tencent and Sequoia Capital | KrASIA

Shimao Property subsidiary gets USD 244 million from Tencent and Sequoia Capital

Written by Wency Chen Published on     2 mins read

Shimao Service, an arm of Shimao Property, has over 500 management projects in more than 60 cities across China.

Internet giant Tencent (HKEX: 0700) and venture capital firm Sequoia Capital China have injected USD 114 million and USD 130 million, respectively, into Shimao Service, the management service subsidiary of property developer Shimao Property Holdings Limited (HKEX: 0813), according to a filing made on Thursday with the Hong Kong stock exchange (HKEX).

According to Shimao’s filing, the strategic investment from Tencent will be used to upgrade the firm’s services digitalization. Sequoia will support the company to become more efficient through technological applications, including cloud computing, big data, and the Internet of Things (IoT).

Shimao Property, listed on the main board of HKEX since 2016, had 349 projects of residential, hotel, office, and commercial properties in 120 Chinese cities, owning 76.8 million square meter lands as of 2019.  

Shimao Service, the offshoot of Shimao Property, claimed over 500 management projects in more than 60 cities across the country by the end of 2019. Last year, from its property management service, Shimao raked in RMB 2.7 billion (USD 380 million) in revenue, up 68.1% year-on-year (YoY), accounting for 27.6% of its RMB 9.8 billion (USD 1.38 billion) in total revenue. 

In April, Shimao announced its Hong Kong Initial Public Offering (IPO) plan for its management service unit.

The recent investment is not Tencent’s first bet in the real estate industry. In March 2019, the company led the Series D round of Beike Zhaofang, an online listing platform launched by Chinese real estate brokerage Lianjia,  investing USD 800 million, KrASIA reported. Tencent later included Beike’s housing services into WeChat’s Wallet portal, giving the latter direct access to the app’s 1.2 billion active users.

Beike also secured over USD 2.4 billion in another Series D+ financing round led by Softbank, which became the largest backer after its USD 1.5 billion investment in November 2019, with Tencent and Sequoia both participating, KrASIA wrote,

China’s real estate market has experienced an upsurge in sales in recent years. Per stats from the National Bureau of Statistics, sales in 2019 grew to RMB 15.97 trillion (USD 2.25 trillion), up 6.5% YoY. Developer investment has reached RMB 13.21 trillion with a 9.9% YoY growth.


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