Brazil: São Paulo-based proptech startup Loft is seeking to close a US$68 million [360 million Brazilian reales] round as part of a real estate investment fund to buy up more properties in the city and Rio de Janeiro.
The company told local daily newspaper Estadão that it had raised 300 million reales [approximately US$58.1 million] of its target so far, thanks to backing from internal investment and external investors, including XP Investimentos and Itaú BBA. It expects to reach its target in the coming months.
Founded back in 2018, Loft operates by buying, renovating and selling real estate within a four-month timeframe and it is aiming to further simplify the process by allowing Latin Americans to have a home of their own.
In recent weeks, the startup has made moves towards the short-term rental space by acquiring fellow Sao Paulo-based startup Uotel, which operates small studio apartments in residential buildings, providing short-term stays with hotel-like facilities and amenities, including daily cleaning, breakfast, a gym and a swimming pool.
Prior to the acquisition, Uotel operated more than 150 rented apartments, which will now form part of Loft’s growing property portfolio in the Brazilian market. It was Loft’s third purchase since 2018, following that of market research company SPRY in February and property renovation firm Decorati in 2019.
Back in December, Loft reached unicorn status [a tech company achieving a value of over $1 billion] after receiving US$175 million in a Series C investment round led by Vulcan Capital and Andreessen Horowitz.
The digital real estate platform has diversified into the short-term rental space in anticipation for shifts in property seekers’ attitudes towards travel and homeownership in Brazil, following the coronavirus outbreak.
From now on, it says that young professionals will be keen to move away from busy city centres towards suburbs where it is less expensive but still retains the suburban environment, have their own office space conducive to remote working and sign short-term leases on apartments due to the uncertainty of real estate at the moment.
Co-founders and co-CEOs, Mate Pencz and Florian Hagenbuch have said they aim to “simplify the purchase and sale of apartments by bringing improved organization, data and efficiency to the residential real estate market”.
In an interview with Crunchbase, they added that the startup combines real transaction data with a proprietary machine learning model “to price every apartment in its markets at the unit level” with the goal of increasing liquidity and transparency for buyers and sellers. It also offers apartment renovations as part of its end-to-end home buying and selling process.
Looking ahead, Loft’s co-CEOs have ambitious growth plans for the business to expand across both Brazil and Latin America, including Mexico, and this latest investment will help to accelerate these plans despite the Covid-19 outbreak.