(Yicai) July 7 -- JD.Com has become the latest internet giant to place a bet on Hong Kong's student housing market, agreeing to pay HKD750 million (USD95.6 million) for a property holding company that is converting a former hotel into dormitories.

JD.Com has finalized a deal to buy Charter Joy from Far East Consortium International, the Hong Kong-based developer announced yesterday. Charter Joy owns a hotel in Yau Ma Tei, Kowloon, which is being remodelled into student accommodation, with the project expected to be completed in the second half of this year.

Far East said the disposal is expected to generate a gain of about HKD423 million (USD53.9 million), which will be used to repay bank loans and as general working capital. Under the deal, Far East will continue to manage the property and pay a guaranteed income to JD.Com for three years.

Over the past two years, demand for student accommodation has intensified in Hong Kong as universities enroll increasing numbers of non-local full-time students. There was a shortfall of about 76,300 beds in the city for the 2025-2026 academic year, which is expected to rise to 147,000 by 2029-2030, according to a report by real estate services provider Jones Lang LaSalle.

Building new student accommodation in Hong Kong is difficult because of land constraints, lengthy approvals, and high development costs. So property developers in the special administrative region and from the Chinese mainland are redeveloping hotels into student dorms.

Deals involving these conversions accounted for 52 percent of Hong Kong hotel transactions last year, up from 45 percent in 2024, per Jones Lang LaSalle’s report. At the same time, the number of quality hotels available for conversion in the city is fast decreasing.

Since last year, JD.Com has made several investments in Hong Kong. In December, the Beijing-based company announced that it would acquire an office building in the city center for HKD3.5 billion (USD446.3 million). Earlier, it acquired Hong Kong grocery shop chain Kai Bo Food Supermarket, gaining control of more than 90 outlets.

Editors: Dou Shicong, Futura Costaglione