Ascott jointly acquires $192 million freehold serviced residence in Sydney

By Charlene Chin

/ EdgeProp Singapore |

September 26, 2019 9:07 PM SGT

Join our Telegram channel and follow our Facebook for the latest update.

SINGAPORE (EDGEPROP) - CapitaLand’s wholly-owned lodging business unit, The Ascott Limited has acquired a $192 million freehold serviced residence in the North Sydney CBD through its 50:50 private equity fund with Qatar Investment Authority – the Ascott Serviced Residence Global Fund (ASRGF).

To be named Citadines Walker North Sydney, the serviced residence is part of a 48-storey integrated development that also has office and retail components. It will be the tallest tower in North Sydney when it is completed in 2021.

Citadines Walker North Sydney (Pictures: The Ascott Limited)

“This latest acquisition in Australia is in line with our strategy of growing our fund management portfolio through private equity funds, joint ventures and listed hospitality trusts – all of which provide a core asset base for our asset management business,” says Kevin Goh, Ascott’s CEO.

The announcement was made at the grand opening of La Clef Champs-Élysées Paris in France today. La Clef Champs-Élysées Paris is also one of the assets invested by ASRGF, and comes under The Crest Collection, which comprises some of Ascott’s most prestigious and unique luxury serviced residences.

Other assets invested by ASRGF include Citadines Islington London which will open this November, as well as lyf Funan Singapore which started operations early this month.

La Clef Champs-Élysées Paris

“The recent proposed combination of our two hospitality trusts, Ascott Residence Trust and Ascendas Hospitality Trust, will cement Ascott Residence Trust’s position as the largest hospitality trust in Asia Pacific,” Goh says. “With Ascott’s sponsored stake in the trust, we will continue to benefit from the properties’ steady yield and participate in their future growth.”

Franchise and management contracts sealed

In addition, Ascott also announced today that it has signed 13 other properties under franchise and management contracts. The properties are located across China, France, Indonesia, Kenya and Vietnam. Including its latest acquisition in Australia, the 14 new properties offer more than 2,200 units.

Among the 14 newly secured properties are four franchise agreements signed with Aegide Domitys, France’s leading provider of serviced accommodation for independent seniors. Citadines Connect City Centre Roanne is the first property in Europe under Ascott’s Citadines Connect brand of business hotels. Two properties, Hôtel Château Belmont Tours and La Clef Golfe-Juan will be part of The Crest Collection and the fourth property is Citadines Toulouse. These four properties in France market Ascott’s foray into three new cities – Golfe-Juan, Tours and Roanne, and will open from 2020 to 2023.

Ascott and Aegide Domitys signed franchise agreements for Citadines Confluent Nantes and Citadines Eurometropole Strasbourg in 2017. The former has recently opened while the latter will open in 2020.

Meanwhile, of the nine new management contracts, Citadines IFC Shenyang and Citadines Huijin Nanxiang Shanghai are secured under Ascott’s strategic alliance with Nasdaq-listed Huazhu Hotels Group and its subsidiary CJIA Apartments Group. To date, eight properties in China have been signed under this partnership.

Citadines Connect City Centre Roanne

Elsewhere, Ascott has secured its first Yello-branded hotel in Vietnam with the signing of a management contract for Yello Phu Nhuan Ho Chi Minh City. Yello is one of six brands by TAUZIA Hotels Management, which Ascott has a majority stake in. Ascott has also sealed two management contracts in Bandung and Belitung in Indonesia under TAUZIA’s FOX and Vertu brands respectively.

Onward to 160,000 units

Year to date, Ascott has secured a total of over 10,600 units – double the number of units signed organically for the same period last year. Its portfolio has hit a total of more than 112,000 units – consisting of more than 66,000 operating units and close to 46,000 units under development -- in over 700 properties. The group has a total asset value of $10 billion and remains on track to meet its global target of 160,000 units by 2023.

lyf Funan Singapore

Goh says Ascott will continue to achieve scale with its international network of well-known hospitality brands. It is targeting to open another 19 properties, which would add more than 2,800 units this year.

The international lodging owner-operator also plans to continue to boost its fee income by growing its assets under management and lodging management business.

“Our strong management expertise, direct sales distribution channels, loyalty programme and digital transformation efforts will drive operational efficiencies at our properties, to support Ascott’s expansion through investments, management contracts, franchises, leases and strategic alliances,” he says.

Since the launch of Ascott’s loyalty programme – Ascott Star Rewards – in April, the number of direct bookings and room nights booked on its websites as well as online revenue by its members have quadrupled.

Read also: