Pacaso, a property co-ownership sales and management platform launched only about a year ago, said on Tuesday it raised US$125 million in a funding round led by SoftBank Group Corp's Vision Fund 2 which valued the company at US$1.5 billion.
Pacaso buys luxury homes, renovates and furnishes them, and then finds up to eight owners to buy a share of the property. The property is then managed through Pacaso’s SmartStay app between the owners who may not know each other.
"Owning a second home is an aspiration many, many families share. But it tends to be out of reach for most people because second homes are very expensive and they're also highly underutilized," said Austin Allison CEO and co-founder of Pacaso.
The company makes money on reselling the property and a fee for using the management app, said Allison.
The fast growing startup, already operating in 25 destinations in the United States, has also quickly hit some pushback.
In May, a local newspaper https://www.sonomanews.com/article/business/sonoma-neighbors-vow-to-stop-controversial-new-homebuying-model in Sonoma Valley, California’s wine region, reported neighbors of a co-owned Pacaso home posting signs “Pacaso time shares not welcome here” and there are at least two petitions on change.org.
Allison said Pacaso “is actually part of the solution” and not causing housing shortages as it helps people looking for second homes pool funds together to buy luxury homes rather than compete for regular residential homes.
Allison said Pacaso manages nearly US$200 million worth of real estate on its platform. The company will also expand into Spain by the end of the year as it starts its global expansion, he said.
(Reporting by Jane Lanhee Lee; Editing by Lincoln Feast.)