[UPDATE] The Assembly Place set to cross 1,500 rooms
/ EdgeProp Singapore |
SINGAPORE (EDGEPROP) - Co-living operator The Assembly Place (TAP) recently unveiled its latest property. Located at Duke’s Road, off Bukit Timah Road, the property is a four-storey block comprising eight walk-up apartments.
The property is owned by Singapore-based, real estate investor and developer Pacific Eagle Real Estate, which purchased the freehold development en bloc for $53.9 million in December 2021. TAP was appointed by Pacific Eagle Real Estate last year to manage the walk-up apartments. There are also four shops located on the ground floor of the building which are not managed by TAP. (See potential condos with en bloc calculator)
The Assembly Place at Duke’s Road is the co-living operator’s latest property, with a total of 42 rooms (Picture: Samuel Isaac Chua/The Edge Singapore)
After taking over the property in October 2022, TAP spent 3½ months renovating and fitting out the space. This included redoing all the kitchens and bathrooms, replacing the windows for all units, and other rectification works.
There are 42 rooms at the Duke’s Road property, which TAP has started launching in phases. Of the nearly 30 rooms that have been released since early February, nearly half have been leased. “Close to 20 rooms have been taken up,” says Eugene Lim, founder and CEO of TAP. The remaining rooms will be launched in the next couple of weeks. “We should be able to hit 90% occupancy by the end of February,” Lim predicts. Rooms at the property have monthly rental rates starting from around $2,000 for a common bedroom.
The living and dining area of one of the units at the Duke’s Road property (Picture: Samuel Isaac Chua/The Edge Singapore)
The property is the latest in a series of openings by TAP in the last few months. In mid-January, it launched a co-living hotel at 3 Veerasamy Road in Little India. The 24-room boutique hotel occupies a row of four adjoining conserved shophouses, which are owned by integrated business group Santa United International Holdings. Unlike its co-living residences which require a minimum stay of three months under URA regulations, the co-living hotel has a minimum stay of one night.
Since opening, the hotel has seen an average occupancy of around 82%, Lim shares. It is TAP’s second hotel, following The Assembly Place, A Co-Living Hotel @ Mayo — a 23- room property at the corner of Mayo Street and Jalan Besar — which opened last September. TAP also ventured into the hostel space last year with the opening of its first co-living hostel at 25A Perak Road in November. The 31- room, 180-bed property is now 100% leased.
The lobby at The Assembly Place, A Co-Living Hotel @ Veerasamy (Picture: The Assembly Place)
Venturing into serviced apartments
Following its move into boutique hotels and hostels, TAP will soon have another accommodation type under its belt — serviced apartments. The operator recently signed a five-year lease agreement with Metropolitan YMCA (MYMCA) to take over the latter’s serviced apartments at 58 Stevens Road which was operating under the name Metropolitan YMCA Residences. MYMCA had previously attempted to put the building, which sits on a 21,480 sq ft residential site, on the market in July 2021, but did not find a buyer.
The building has 27 units that house 46 rooms made up of studio apartments and one-, two- and three-bedders. TAP will carry out minor rectification works and rebrand the property as The Assembly Place @ Stevens. Scheduled to open mid-March, it will be TAP’s first co-living serviced apartment, which, per URA regulations, can be rented out for a minimum period of seven days.
Besides the MYMCA property, TAP is planning to open three more serviced apartments. One is at 3 Tank Road in the River Valley area, which will have 15 rooms. The second is at 18 Penhas Road, off Lavender Street, with 12 rooms, while the third is a four-bedroom shophouse at 272 East Cost Road. All the properties are targeted to open by June. Lim sees the serviced apartments as a meaningful addition to TAP’s portfolio. “It strengthens our position as an accommodation provider, adding to our existing offerings across residential, hotels, and hostels,” he says.
The Assembly Place has signed a five-year lease agreement with Metropolitan YMCA (MYMCA) to take over the latter’s serviced apartments at 58 Stevens Road (Picture: The Assembly Place)
Building a pipeline
Beyond expanding its shorter-stay offerings, TAP continues to grow its conventional co-living portfolio. It has expanded its roster of rooms by acquiring properties of various sizes, from strata-titled condominium units to whole buildings. According to Lim, the operator has a 50:50 split between units that are acquired through a straight lease with the property owner and those that are signed through a management contract.
Recent signings include an 80-room residential development located off Geylang Road, which will be handed over to TAP in April. Lim expects to see a healthy take-up for the property once it launches, based on the strong performance of Mill at 32, its nearby property on Lorong 32 Geylang, with achieved an average occupancy of 98% last year. With 152 rooms, Mill at 32 is also TAP’s largest property.
Elsewhere, TAP has also signed a deal to operate a new residential building along Mattar Road. Spanning five storeys, the 40-room development is slated to receive its temporary occupation permit within the next two months. In total, TAP has some 400 rooms in its pipeline which will be launched over the next few months. “By June this year, we should have 1,500 rooms across 110 locations,” Lim says.
One of The Assembly Place’s upcoming properties is a five-storey co-living residence at Mattar Road which will offer 40 rooms (Picture: The Assembly Place)
3,000 rooms by end-2023
The company remains committed to its target of hitting 3,000 rooms by the end of the year — a goal Lim is optimistic about achieving, given TAP’s current growth momentum. “I think hitting 1,000 rooms last September made a lot of difference,” he remarks. “Once we hit that threshold, we achieved critical mass, which allowed us to grow a lot faster.” One reason for this is increased visibility in the market, with more landlords, asset owners, and agents reaching out to the company with prospective properties. “More people have started approaching us, instead of us hunting properties down,” Lim relates.
Scaling up has also enabled TAP to turn around properties faster. It now has a team of 32 people, which includes an in-house design and project team that oversees all the renovations and refurbishments carried out at its properties prior to launch. This has significantly cut down the time between getting the keys to the property and leasing it out to tenants. “In the past, it could take up to six weeks for us to turn around a unit, whereas now, it can be as short as two weeks,” says Lim.
Eyeing student accommodation
As TAP continues to grow, Lim has his sights on a new segment of the market: student accommodation. “That’s the next thing we want to go into,” he says, adding that the company is currently in the midst of negotiations for a property “with close to 500 beds” for its maiden project.
Lim sees student housing as an underserved segment in Singapore. As such, he aims to fill the gap with a “premium co-living hostel” which will cater to students, especially those from overseas. “Right now, 60% of TAP’s co-living tenants are aged 30 and below, and of this group, 61% are students. It’s a big group,” he shares.
Most of these are international students, with the largest cohort coming from China, followed by French and Indian students. “We have a lot of MBA students studying at places like Insead and Essec Business School,” he adds. Foreigners, including permanent residents, account for 83% of TAP’s demographics.
Lim expects the international student population in Singapore to see a boost now that safe-distancing measures have been eased and most countries have dropped border restrictions, including China. Last month, China’s Ministry of Education issued a directive stating that students taking online classes at foreign universities must return to their overseas campus, as online study would no longer be recognised. This reverses a previous policy implemented during the pandemic that allowed students enrolled at foreign universities to study remotely. This development bodes well for TAP’s plan to enter the student accommodation segment. If it manages to secure the 500-room property, that will provide another surge in growth for the company.
Amidst all this expansion, Lim is cognisant that it is not just about increasing its room count but also making sure the rooms get rented out. “Something I drill into my team is that occupancy is important, especially as we grow bigger,” he says. TAP saw an average occupancy of 95% last year across its co-living properties, with Lim targeting to push this up to 98% this year.
With this in mind, he is focused on hitting that 3,000-room threshold. “We have the right team in place, so it’s just a matter of how fast we can get there,” he says.
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