Warburg Pincus-Backed Weave Co-Living Expands into Singapore via S$150M JV

A Hong Kong-headquartered co-living firm that owns and operates over $300 million of assets in its home city is expanding its operations internationally with a S$150 million ($108.1 million) equity investment in Singapore.

“The strategy is to go and acquire serviced apartments and hospitality assets,” Sachin Doshi, CEO of Weave Co-Living told Mingtiandi in an exclusive interview. “We’re going to reposition them into co-living and rental accommodations. These assets will be repositioned, redesigned and rebranded into Weave properties.”

Doshi said that through the joint venture, Weave expects to purchase two assets in Singapore by the end of 2020 as the current downturn in the hospitality market creates acquisition opportunities. The former executive with Dutch pension fund APG told Mingtiandi that establishing this presence in Southeast Asia’s wealthiest city is part of Weave’s plan to expand into Australia, Korea, India and other key Asia Pacific markets during the next 12 months.

Working with a Local Team

Warburg Pincus-backed Weave is grabbing its Singapore foothold through an asset-level joint venture with Singapore-based 32RE, a recently established subsidiary of Catalist-listed builder SLB Development. Per the terms of the joint venture, Weave will contribute S$120 million and 32RE S$30 million in the 80/20 deal.

The joint venture is Weave’s first investment outside of its home city, Doshi said, and the company will not seek third-party capital on its side of the Singapore deal and will finance the initiative from its own balance sheet. 32RE was established in the fourth quarter last year by former Surbana Jurong and BlackRock executive Jeremy Choy.

The co-living firm has gone solo for its Hong Kong operations, but teamed up with 32RE in Singapore to gain local expertise in deal-sourcing as well as to secure experience in negotiating regulatory processes and managing renovations in the island nation. Doshi expects the joint venture to invest in around S$500 million of assets.

“I think this will give us the capacity to go and buy about half a billion of the Singapore dollar worth of assets, “Doshi said. “And really be the first truly co-living and rental housing there in Singapore that owns the assets and really controls all aspects of the offering.”

Three-Year-Old Firm Goes Regional

Doshi founded Weave in 2017 after having struggled as a young professional in Hong Kong with managing his rented apartment despite paying five-star rates for a home near Central. The mismatch between pricing and residential quality standards in Hong Kong and other major Asian markets, planted the seed for what would become Weave.

Doshi secured a $181 million investment from Warburg Pincus in November 2018 and told Mingtiandi last November that Weave had already invested $300 million in its four major properties in Hong Kong.

The company has established over 600 co-living units in the city, including the 160-unit Weave on Boundary in Kowloon and Weave on Anchor, a 200-unit property close to Hong Kong’s High Speed Railway Station that’s set to open in August.

Doshi said that unlike co-living operators who pursue an asset-light business model, Weave is a fully integrated owner and operator — an approach that he sees as an advantage in delivering attractive properties and appealing services as the company goes regional.

“If we see that a market is deep enough for us to do something organically or acquire a platform, these are a possibility for us,” Doshi said. “We try to go in with the best possible solution and we want to control the product and outcomes. It’s a structure that we like.”