(Yicai Global) Feb. 12 -- An affiliate of Chinese e-commerce platform JD.Com has acquired a large unprofitable hotel next to its first office space in Beijing to turn it into research and business facilities.
Jingdong Shangke Information Technology paid USD398 million to buy all the equity of Jade Palace Hotel. Liu Qiangdong, also known as Richard Liu, the founder and chief executive of JD.Com, is the legal representative of the buyer, business information platform Tianyancha shows.
Founded in 1998, JD.Com set its first office in Zhongguancun Street in Beijing's northwestern Haidian district, originally known for its consumer electronics shops. The area has grown to be coined as 'China's Silicon Valley' with Baidu and Sina settling in the evolving tech hub.
The acquisition is based on long-term positioning and development, JD.Com told Yicai Global, adding that the hotel will be transformed into offices for technology research and development, as well as business purposes.
Jade Palace Hotel, which has an office space of over 9,000 square meters and more than 300 rooms, achieved revenues of CNY18 million (USD2.7 million) as of last September. Losses were CNY47.1 million and its liabilities exceeded assets.
Editor: Emmi Laine