Hong Kong-based Gaw Capital Partners on Friday announced the final closing of its proptech-oriented Gaw Growth Equity Fund I, bringing total equity raised for the fund (including co-investments) to $430 million.
Launched in late 2020, the investment vehicle backs high-growth, Asia-focused companies in proptech and operational businesses related to real estate. Minus the co-investment deals, the fund closed with $332 million in capital commitments and is about one-third committed, Gaw said in a release.
Limited partners in the venture include sovereign wealth funds, endowments and other institutional investors that have invested in previous Gaw vehicles, as well as new partners.
“We are delighted to be closing Gaw Growth Equity Fund I successfully in such a short time,” said Christina Gaw, managing principal and co-chair of alternative investments for the family-headed private equity firm. “The institutional investors’ commitments to our Gaw Growth Equity Fund I reflects their readiness to allocate more of their capital towards proptech and ESG related investments, given the attractive market opportunity and rapid growth of the sector.”
Gaw has made technology a growing component of its investment strategy, notably with the firm’s Series D financing for Beike, China’s biggest property listings website, before that company’s August 2020 IPO.
Gaw’s other proptech plays include co-leading a Series A+ financing round totalling $8.3 million for SensorFlow, a Singaporean startup that lets hotels automate heating, ventilation and air-conditioning systems and optimise housekeeping routes; and leading a Series A2 fundraising round totalling $5 million for Switch Automation, a global software developer that helps property owners and facility managers cut operating costs and improve energy efficiency.
Gaw has also ploughed capital into Beijing-based Ziroom, the largest apartment rental management platform in China and the country’s first rental housing unicorn, as well as Tencent Trusted Doctors, which provides a mix of online doctor-to-patient services and offline facilities.
Humbert Pang, managing principal and co-chair of alternative investments, highlighted the potential synergies between these tech businesses and Gaw’s existing property holdings.
“Our vast real estate portfolio will complement proptech companies in adopting the new technologies to implement more ESG initiatives for energy savings, improving operational efficiencies and providing a testing ground for innovation,” Pang said. “Moreover, we have already started to adopt multiple technologies in the space under our management.”
Drawn to Innovation
Aside from the firm’s opportunistic real estate funds, Gaw and its partners in recent years have pursued China-based property strategies with a tech twist.
Last September, Gaw announced that it had closed on $1.3 billion in equity for its first data centre fund, just 10 months after launching the China-focused platform in November 2019. Backed by the Abu Dhabi Investment Authority and other global institutional investors, the fund had been unveiled at the same time as a joint venture with Beijing-based data centre operator Centrin to acquire, develop and operate hyperscale facilities on the mainland.
In October, Gaw revealed that, through a fund under its management, it had reached an agreement with Manbang Group to form a smart logistics JV platform to develop smart logistics properties and facilities across China.
One of the top unicorn companies in China’s logistics industry, Manbang provides freight services to match truck drivers with shippers online through its mobile app, which has transformed and optimised the highly segmented Chinese market, the companies said.
Since its founding in 2005, Gaw Capital Partners has raised six commingled funds targeting Greater China and APAC. Gaw has raised $16.9 billion in equity since 2005 and had $27 billion in assets under management as of 2020’s third quarter.