DoubleDragon seeks $125M in overseas venture capital financing for Hotel101

On Dec 14, 2022

Listed property developer DoubleDragon Corp. is seeking $125 million from venture capital investors to bankroll the international expansion of Hotel101 ahead of a planned overseas initial public offering (IPO).

Led by tycoons Edgar “Injap” Sia II and Tony Tan Caktiong, DoubleDragon’s board of directors approved the process for Series A and Series B overseas equity capital issuances for Hotel101 Global Pte. starting as early as January 2023, a stock exchange filing on Wednesday showed.

The Singapore-based subsidiary will hold all overseas investments of Hotel101, which is also building a nationwide presence after opening its first project in Manila in 2016.

Hotel101 Global will be used as the overseas corporate IPO vehicle for the group’s international expansion, DoubleDragon added.

Sia previously told the Inquirer the company planned to take the hotel business public via an IPO in Singapore by 2025. The company’s valuation could reach $1 billion, however, these were estimates that could still change.

In its filing, DoubleDragon said the Series A equity tranche will involve investor calls with venture capital institutions.

“Series A offshore institutional investors will have the opportunity to be one of the first batch of venture capital investors that can take early equity positions in Hotel101 Global,” DoubleDragon said.

Ultimately, the firm is targeting to become one of the “top 10 largest hotel brands in the world.”

By 2023, it plans to reach 7,331 hotel rooms globally that were either operating or in its project pipeline. This would grow to 200,000 rooms by 2035, the developer said.

Project will be developed though direct investments, joint ventures and brand and concept licensing arrangements.

“Hotel101 rooms globally are generally uniform in size and caters to the mid-end market, enabling a highly efficient booking process allowing guests to know exactly what to expect in a Hotel 101 wherever it may be located,” DoubleDragon said.

Moreover, its condotel concept patent had earlier been filed while the Hotel 101 trademark and country-specific domains have been secured in various countries.

“Hotel 101 adopts dynamic pricing on its room rates similar to airline tickets where its room price moves up and down depending on the real time supply and demand on the chosen date of booking,” DoubleDragon said.

“The asset light Hotel 101 concept allows DoubleDragon to generate revenue and income twice, first from the pre-selling of the Happy Rooms, then second after the project is constructed it generates long term recurring revenue from hotel operations,” it added.

Its first international location is Hotel101 in Niseko, Hokkaido in Japan, which is expected to generate a total $137.3 million after selling of units begins in the first quarter of 2023.

Hotel101 Niseko will have 518 rooms, which will be be sold to investors and end-users through pre-selling activities.

“In the Philippines, DoubleDragon Corporation is one of the very few companies that has a brand and concept that is exportable globally, and a business model that has a high chance to transcend as a successful mainstream global business,” the developer said in the filing.