Why is JD.com spending US$400 million to buy this hotel in Beijing? – SCMP

What happened: China’s e-commerce giant JD.com has acquired 100% ownership of the Jade Palace Hotel in Beijing for $400 million. The Nasdaq-listed company is planning to transform the building into a space for technology innovation and commercial businesses. The hotel, which started operation in 1998, posted a net loss of RMB 47 million ($6.93 million) for the nine months from January to September 2018.

Why it’s important: JD’s purchase of the iconic building comes as a surprise given that it already has very large headquarters in the southeastern suburbs of the capital. The hotel’s convenient location at the center of Beijing’s Haidian District, where it enjoys proximity to top universities and the high-tech area of Zhongguancun, could be a big factor in the deal. JD’s move to strengthen its foothold in downtown Beijing bucks the trend among Chinese tech firms who are escaping tech hubs and shifting their R&D centers and headquarters to second-tier cities where they can access more affordable space, avail of lower salaries and tap preferential policies offered by local governments.

Start your free trial now.

Get instant access to all our premium content, archives, newsletters, and online community.

Monthly Membership

Yearly Membership

What you get

Full access to all premium content and our full archives

Members'-only newsletters

Preferential access and discounts to all TechNode events

Direct access to the TechNode newsroom

Start your free trial now.

Get instant access to all our premium content, archives, newsletters, and online community.

Monthly Membership

Yearly Membership

Emma Lee

Emma Lee is Shanghai-based tech writer, covering startups and tech happenings in China and Asia in general. We are looking for stories related to tech and China. Reach her at lixin@technode.com.