(Yicai) July 7 -- Chinese e-commerce giant JD.Com is the latest company to enter the Hong Kong property investment market’s new key segment of converting hotels into student accommodation, addressing the city’s persistent shortage of student dormitories.

JD.Com will invest HKD750 million (USD95.6 million) to buy Charter Joy from Far East Consortium International, the Hong Kong-based property developer announced yesterday. Charter Joy owns a hotel located in Yau Ma Tei, Kowloon, which is being converted into student dormitories, with the project expected to be completed in the second half of this year.

Far East will likely generate about HKD423 million (USD53.9 million) in profit from the transaction, which will be used to repay bank loans and as general working capital, the company noted. After the transaction is completed, Far East will no longer own the property but will continue to manage it and pay guaranteed income to JD.Com for three years.

Over the past two years, the number of non-local university students in Hong Kong has been steadily rising, leading to a shortage of student accommodation. There was a shortfall of about 76,300 beds in the city for the 2025/2026 academic year, with the gap expected to increase to 147,000 beds by the 2029/2030 academic year, according to a report by global real estate services provider Jones Lang LaSalle.

To seize opportunities from this shortage, many property developers from the special administrative region and the Chinese mainland have begun converting existing hotels into student dormitories.

The proportion of transactions involving the conversion of hotels into student dormitories in Hong Kong’s hotel market increased to 52 percent last year from 45 percent the previous year, per the report by Jones Lang LaSalle. However, the number of quality hotels available for conversion in the city is rapidly decreasing.

Since last year, JD.Com has made several investments in Hong Kong. In December, the firm announced 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