CapitaLand’s lodging unit The Ascott has signed 26 properties, with 23 under management contracts and three on franchise agreements, the company said in a filing to SGX Monday.
The properties, which will open in phases from 2019-2023, have more than 6,000 units across 22 cities and 11 countries, the filing said. The countries include Vietnam, Thailand, China, Kazakhstan, Indonesia, Malaysia, Japan, Kenya, Australia, the Philippines and South Korea, the filing said.
“We are fast-expanding Ascott’s global network of properties as we continue to pursue an asset-light business model to boost our recurring fee income,” Kevin Goh, Ascott’s CEO, said in the statement.
“While we achieve strong momentum in expanding our global lodging business through strategic alliances, management contracts, franchise and leases, we are also accelerating the number of new property openings,” Goh added.
So far this year, Ascott has signed contracts for more than 40 properties with more than 8,000 units, up 40 percent by units on-year, the filing said. In addition, the lodging company has opened 16 properties with more than 2,000 units, marking a 70 percent on-year increase by units, the company said.
Ascott is targeting to open more than 40 properties with around 8,500 units this year, the statement said.
Goh said Ascott estimated every 10,000 serviced residence units signed, the company earns around S$25 million in fee income annually. He added Ascott was targeting 160,000 units by 2023.
For the first quarter, Ascott posted S$59.7 million in fee income, Goh said.
The CEO also noted that the recently announced merger of Ascott Residence Trust, which The Ascott sponsors, and Ascendas Hospitality Trust would have more financial flexibility for acquisitions.
“Ascott as a sponsor can focus on growing and injecting our lodging assets into a single hospitality trust, and recycle capital into new development opportunities,” Goh said. “At the same time, Ascott will continue to benefit and participate in the future growth of these quality assets through our sponsored stake in the trust.”
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