ChengHome Apartment, a hotel and serviced apartment brand created by Chinese hotel management company Huazhu Hotels Group and Boston-born investment firm IDG Capital, announced on Monday the completion of a series A funding round at nearly US$300 million.
The new round was led by China-focused private equity firm Boyu Capital, with the participation of other investors including Huazhu Hotels Group, serviced residence owner-operator The Ascott Limited, CCB International, an investment services company owned by China Construction Bank (CCB), and YF Capital, a private equity fund backed by Alibaba’s founder Jack Ma, according to a prepared statement.
ChengHome Apartment, founded in 2015, offers hotels, serviced apartments, guesthouses and residential services. The start-up allows customers to rent apartments for a flexible duration ranging from one day to one month and more. The flexible rental offering model has helped it realize an average occupancy rate of over 95%, according to the statement.
The firm manages eight brands, including "Yuansu," a serviced apartment brand targeting corporate employees, long-term rental apartment brand "ChengHome Apartment," and international hotel chain "Citadines." The company currently manages over 20,000 rooms, most of which are in first-tier cities like Beijing, Shanghai and Shenzhen — a cautious strategy taken by the start-up to develop in China’s booming yet hot-headed apartment rental market.
"There is nothing special about the combination of long-term and short-term apartment rental services. The challenging part is the construction of an IT system and the system operation behind the scene," said Jin Hui, chairman and CEO of ChengHome Apartment. "Data and technology will become the two essential elements driving the future development of ChengHome Apartment."
Proceeds will be used for further property development in major Chinese cities, brand promotion, and the improvement of the company’s technological platform. The company also plans to rapidly expand assets by purchasing real estate, according to the statement.