Real estate platform Beike has secured over USD 2.4 billion in its Series D+ financing round, which was closed in November 2019, the company confirmed with local media Tencent News on Wednesday. Having poured in USD 1 billion, SoftBank became the largest backer in this round.
Other participants of include Tencent, Hillhouse Capital, and Sequoia Capital.
The fresh funding will be used for tech R&D, product innovation, and talent recruitment, said the firm. Beike will have a valuation of USD 14 billion after this round.
Beike was founded in April 2018, after real estate brokerage Lianjia, already dominant in large cities such as Beijing, refocused and rebranded its online business to connect property agents and property-seekers across the country. Prior to this round, Beike had closed USD 1.2 billion Series D financing in July 2019, in which Tencent injected USD 800 million, according to a 36Kr report.
As of December 2019, Beike had expanded to 106 Chinese cities, counting more than 235 real estate brands, 38,000 brick-and-mortar brokerages, and 360,000 brokers on its platform.
The company was reportedly aiming for an initial public offering in Hong Kong this year, targeting a value of USD 20 billion to 30 billion.
China’s real estate market has seen an upsurge in sales in recent years. Data from the National Bureau of Statistics shows that sales of residential properties have grown to RMB 13.94 trillion (USD 2.01 trillion), up 10.3% year-on-year, double the sales figure of RMB 6.24 trillion in 2014.
With an eye on the online Chinese real estate market, SoftBank also invested another USD 1 billion via its Vision Fund into Chinese apartment rental platform Ziroom, also an offshoot of Lianjia. The Vision Fund directly injected USD 500 million and bought an additional USD 500 million shares from Ziroom founders, The Wall Street Journal reported.
These two investments came at a time when Softbank’s Vision Fund has been criticized for a series of recent investment missteps. It has previously injected USD 2 billion to US office-sharing company WeWork in January 2019, which failed its IPO in September and had to be bailed out with a USD 9.5 billion rescue package. Another portfolio company, Indian hospitality giant Oyo will reportedly have a massive layoff of over 5,000 employees globally.
SoftBank posted an operating loss of USD 2.1 billion from its USD 100 billion Vision Fund for the three months ended December 2019.