Beijing-based online housing platform Beike announced Monday it has received $800 million in Series D funding from Tencent, as Chinese internet giants elbow their way into the country’s burgeoning real estate market.
According to a Beike spokesperson, the new round of funding is led by Tencent and currently under way. The final amount has yet to be decided. Tencent was also one of the main backers of the Chinese real estate broker Lianjia, which launched Beike in April.
Rumors of Tencent’s investment began circulating on Chinese media earlier this month, when some Chinese citizens discovered that Beike was available on WeChat platform. This was confirmed by the housing platform on Friday when it announced users could access its service on WeChat wallet in six Chinese cities—namely, Beijing, Shanghai, Shenzhen, Chengdu, Tianjin and Suzhou.
With the massive volume of traffic coming from WeChat’s 1 billion active users, gaining a spot in WeChat as a third-party service has been the stuff of dreams for many Tencent-backed startups.
Apart from Beike, so far only nine Tencent-backed Chinese companies have been granted the privilege, including ride-hailing unicorn Didi, e-commerce giant JD.com, and Pinduoduo.
Beike is the first and only housing service provider in the WeChat wallet feature. A countrywide rollout is expected to take place in the coming days.
As of March, nearly 170,000 real estate agents from nearly 20,000 offline stores been approved for providing sale, rental, and decoration services in nearly 100 Chinese cities on Beike’s platform.
Chinese tech giants are increasingly taking an interest in housing startups in China, looking to get a piece in the country’s real estate market, the value of which is estimated in the hundreds of billions of dollars. Local real estate developers made investments totaling RMB 1.2 trillion (around $180 billion) with an 11.6% annual increase in the first two months of 2019, said National Statistics Bureau.
Shared housing startup Danke recently closed a $500 million round of financing led by Alibaba’s financial arm Ant Financial, alongside New York-based investment firm Tiger Global Management.
Tencent and Baidu, however, financially backed Lianjia in its Series B in April 2016. One year later, both participated in another round of investment led by Chinese real estate giant Vanke, which totaled RMB 3 billion.
China is witnessing a booming house rental market, as the number of rooms available for rental increased 36% year-on-year in 2018. According to research figures jointly released by online housing rental platforms 58.com and Anjuke, over 246 million Chinese nationals had flooded into Beijing, Shanghai, Guangzhou, as well as the surrounding major cities by the end of 2017.