On Friday May 29th – Hong Kong-based Gaw Capital, a large private equity fund, has announced the final closure of their PropTech-oriented growth fund, the latest in a surge PropTech investments. The Fund – Gaw Growth Equity Fund I – has a capital commitment of US $430 million.
Launched in 2020, the new investment vehicle will target Asian companies that offer innovative solutions to the traditional real estate industry. We are happy to see how the fund’s mission to foster ESG and PropTech development aligns closely with Denzity’s own goal – promoting operational efficiency and international investment throughout the property lifecycle. Along with the fund, Gaw Capital’s has an impressive portfolio and history of modernizing investments.
One such investment was Beike, a leading housing transaction and service platform in China. After Gaw Capital’s series D financing, Beike would go on to raise over US $2 billion dollars at IPO. Ziroom, a leading co-living asset manager, and Singapore-based SensorFlow, which helps properties optimize their energy use, are among other investments.
Despite the fund’s specialization and high growth, this cadre of committed investors does not play small. Large institutional investors such as sovereign wealth funds and endowments have committed, representative of the growing confidence in the PropTech sector. Gaw’s announcement is the most recent in a timeline of increasing investor eagerness.
In 2016, Wall Street’s Fifth Wall Ventures, the largest venture capital firm focused on real estate, closed its first $212 million-dollar PropTech fund. Large developers such as Chinachem Group are also committing to sustainable, smart home development. ChinaChem has since teamed up with China Merchants Capital and Qingdao City Construction Investment to establish the CC Smart City Tech Fund I, with a US $100 million capital commitment.
Investors and stakeholders recognize that while the energy is hot, execution and application remain low. However, the adoption of property technology is here to stay. While top-down initiatives such as mega-funds contribute to the acceleration of PropTech, the root of the change is bottom-up: startup founders pitching, undergoing seed funding, or pivoting careers to tech-centric fields.
For Denzity, the news from the Gaw capital could not have come at a better time. Having recently announced our own product, the momentum and heightened investor interest well for our service. Two years ago, founder and CEO Darren Wong forecasted the monumental change and has since devoted his career to accelerating the modernization and digitisation of the property life cycle. “This is more fuel for the fire,” Darren said in regard to Gaw’s new PropTech fund, “PropTech investment may still be controversial, but there are so many untapped opportunities for ventures to tackle”
Darren has been highly active in Hong Kong’s PropTech landscape: judging hackathons, interviewing startup founders, promoting PropTech for Youth – an initiative to encourage student interest in PropTech – and attending Startmeup HK. Whitepapers from PropTech Institue (PropTech Landscape in Hong Kong 2021), a non-profit organization supporting PropTech development, or JLL, a large commercial real estate firm in Hong Kong, are a few of the publications that imagine the future of real estate.
The moneyed interest from Gaw Capital reinforces that Property Technology is deserving of serious attention, and will reward business leaders by providing the pathway to align with ESG and UN sanctioned development goals.
What is your take on this investment by Gaw Capital? Let us know below.