Chinese co-living firm Harbour launches US$1.58 billion fund to build more rental housing
Gaw-backed Shanghai-based brand set to focus on securing wholesale land plots at low prices
Harbour, a Shanghai-based co-living space operator backed by Gaw Capital Partners and Trustbridge Partners, has launched a 10 billion yuan (US$1.58 billion) buyout fund with a financial leasing company to acquire land plots for rental flat development, on top of another US$1 billion fund with Gaw to acquire existing properties for flat conversions.
Its new foray into such heavy-asset territory sets Harbour apart from most of China’s private equity (PE)-backed flat operators, as it has predominantly opted for an asset-light model, where firms have relatively few capital assets compared to its operations, either leasing entire buildings and subleasing them to tenants, or signing management contracts with landlords.
The new fund is set to focus on securing wholesale land plots at low prices.
“Now we have an asset-light as well as asset-heavy model: the former is following Daito Trust Construction, and the latter is China’s answer to EQR,” said Huang Haibin, Harbour’s CEO, who founded the operation in 2015 after being president of real estate PE under Fosun International.
Daito Trust Construction is Japan’s largest flat-management firm run on an asset-light model, while EQR is a US real estate investment fund (a Reit) that invests in the flat sector.