14 Jan
2005

Ascott Enters Guangzhou And Acquires A New Serviced Residence Development

The Ascott Group, a leading international serviced residence company, has signed a conditional sale and purchase agreement to acquire a serviced residence development in Guangzhou.

This is part of its strategy to extend its leadership of China’s serviced residence industry to the Pearl River delta area in South China.

Ascott will invest RMB 168 million (about S$33 million) in the development which comprises a 192-unit serviced apartment block and clubhouse. The project in the new Tianhe commercial and business district, has prime location at Tianhe East Road, which is often called Guangzhou’s "Wall Street".

Nearby are the new Guangzhou East Train Station, a transit point for travellers to and from Hongkong, Tianhe Sports Centre and office towers with banks, financial institutions and multinational companies. It is also close to two Metro stations and shopping centres.

The development will be completed in 2007, and will be marketed under the group’s flagship luxury-tier brand, The Ascott serviced residence. The property will increase the group’s presence to 2,200 serviced apartments in China, where it is already the country’s largest serviced residence chain.

Ascott is a leading international serviced residence company in Europe and Asia Pacific, with 13,800 serviced residence units in 40 cities in 17 countries. It is the serviced residence arm of CapitaLand Limited, one of Asia’s largest listed property companies.

Ascott’s chairman, Mr Lim Chin Beng, said: "The group’s entry into Guangzhou, the gateway to the thriving Pearl River delta region, is timely and strategic. With the property, Ascott’s market leadership in China will be anchored by its dominant presence in the three major cities of Guangzhou, Shanghai and Beijing. The Ascott Guangzhou will be the company’s third The Ascott brand property, and eleventh residence in China."

Mr Liew Mun Leong, Ascott’s deputy chairman, and president and CEO of its parent company, CapitaLand Limited, said: "Guangzhou has become one of China’s fastest growing cities. Its GDP is the third largest among cities in China and over 115 US ‘Fortune 500’ companies have invested in Guangzhou. Ascott will be in an excellent position to serve the growing expatriate community in the city.

"It is also strategically appropriate to market the group’s flagship The Ascott brand as many international firms, whose staff are used to luxury-tier serviced apartments, are setting up operations or expanding there."

Mr Cameron Ong, Ascott’s chief executive officer, said: "Guangzhou’s new international airport and improved transport infrastructure will enhance its growing role as the financial, manufacturing and logistics hub of Southern China. The expanded air capacity will mean higher tourist and business executive arrivals, and will increase the city’s logistical capability and competitiveness with Hongkong in the long run."

He added that although there has been an increase in the supply of apartments in the city, there is limited supply of purpose built, professionally managed serviced residences that cater to the corporate executives from multinational companies.

"We are entering Guangzhou to meet the accommodation needs of many of our international clients who have set up operations in the Pearl River delta region. They see the area comprising Guangzhou, Hongkong and Shenzhen, as having one of the next best investment climates after the Yangtze delta area of Shanghai and Suzhou," said Mr Ong.

He added that with the new property, Ascott is on track to achieving its target of operating 4,000 serviced residence units in China by 2008. The company is also looking at entering more secondary cities in China where demand for internationally managed serviced residences is expected to increase as their economies grow.

Financial Impact
The acquisition is not expected to have a material impact on Ascott’s net tangible assets per share and earnings per share for the current financial year.

Upcoming Residences
In September last year, Ascott announced the 260-unit Citadines Jinqiao in Shanghai, the first serviced residence in Asia to carry the mid-tier Citadines brand. Citadines is the marque of a leading pan-European serviced residence chain which the group acquired in 2004.

The managed property will open in the third quarter this year, and serve as a prototype for Citadines in Asia. It will be targeted at the rapidly growing segment of travelling executives from Chinese and Asian companies.

In September 2004, Ascott also entered Suzhou by securing the management of the 167-unit Somerset Chongrui. The property in Suzhou Industrial Park is the city’s first international serviced residence and will open next year.

In March last year, Ascott achieved number one position in the prestigious China’s Top 100 Serviced Residences ranking for the management, marketing and quality of its eight residences in Shanghai, Beijing, Tianjin and Dalian. The ranking is based on evaluations from real estate experts and Internet votes.



About Ascott’s Other Serviced Residences in China

In Shanghai
The Ascott Pudong -- 248 units, Pudong district

In the heart of Shanghai’s premier business district, the luxury-tier The Ascott Pudong boasts spectacular views of the Huangpu River. It offers one to four-bedroom designer suites and elegant penthouses with facilities such as a business centre, indoor heated pool, gym, indoor tennis court and residents' lounge.

Somerset Grand Shanghai -- 334 units, Luwan district
Located along Huai Hai Zhong Road, the upper-tier serviced residence is in the heart of Shanghai's main business, shopping and dining belt. Facilities include an indoor heated swimming pool and an international kindergarten. Units range from one to three-bedroom suites.

Somerset Xu Hui - 167 units, Xuhui district
Situated in the Xuhui residential estate, the upper-tier serviced residence is close to shopping and entertainment facilities in the Huai Hai Zhong Road and Xujiahui prime business districts. Facilities include a gym, indoor heated pool, lounge and tennis court. It offers spacious one to three-bedroom suites.

Citadines Jinqiao – 260 units, Opening 3Q 2005

Part of a mixed development, the mid-tier serviced residence is near Shanghai’s famous Nanjing Road shopping belt, and 10-minutes’ walk to two metro stations. It is also close to People’s Square, the Shanghai Municipal Government Building and Shanghai Museum. It will offer studio to two-bedroom suites.

In Beijing
The Ascott Beijing -- 272 units, Chaoyang district
The luxury-tier residence in the heart of the city's CBD is close to the China World Trade Centre. It boasts designer fittings and extensive facilities including an indoor glass-roofed pool, fully equipped fitness centre, and business centre. Units range from elegant one-bedroom suites to four-bedroom penthouses.

Somerset Grand Fortune Garden -- 221 units, Chaoyang district
Located in the business area of Chaoyang district, the upper-tier residence is near international schools, embassies and entertainment centres. Facilities include a gym, indoor heated pool and residents' lounge. Units range from one to four-bedroom suites, with private balconies and scenic city views.

Luxury Serviced Residence - 100 units, Chaoyang district
In Beijing's prime Chaoyang residential district, the mid-tier residence is near Scitech Plaza and Friendship Store shopping malls, Silk Market, Tiananmen Square, Forbidden City and Jianguomen subway station. Facilities include a gym, sauna and business centre. Units range from one to four-bedroom apartments.

In Dalian
Somerset Harbour Court - 106 units, Zhongshan district
Part of the prime Dalian Asia Pacific Finance Centre in the city's CBD, the upper-tier residence is a stroll from Dalian harbour's passenger station and a five-minute drive from the railway station. Facilities include a gym, business centre and lounge. Units comprise one and two-bedroom suites.

In Suzhou

Somerset Chongrui – 167 units, Opening 2006
In the heart of Suzhou Industrial Park’s Singapore style residential neighbourhood centre, it is conveniently close to shops and restaurants, and the Suzhou Singapore International School. The residence will offer studio and one-bedroom suites with recreational facilities.

In Tianjin
Somerset Olympic Tower - 169 units, Heping district
In the heart of Tianjin's prime upmarket shopping area and residential district, the upper-tier residence is close to international schools and the Tianjin railway station. Facilities include an indoor heated pool, gym, and rooftop garden. Units range from one-bedroom suites to four-bedroom penthouses.

About The Ascott Group
The Ascott Group is a leading international serviced residence company with 13,800 serviced residence units in the key cities of Europe and Asia Pacific.

Ascott's global presence spans 40 cities in 17 countries. These include London, Paris, Brussels, Berlin and Barcelona in Europe; Singapore, Bangkok, Hanoi, Kuala Lumpur, Tokyo, Seoul, Shanghai and Beijing in Asia; Sydney and Auckland in Australia and New Zealand; and Dubai in the Gulf region.

Through its marketing alliance with Equity Corporate Housing, the group also offers upper-tier serviced apartments throughout the US. Headquartered in Singapore, The Ascott Group pioneered the Asia Pacific's first branded luxury serviced residence in 1984. Today, it boasts a 21-year industry track record and serviced residence brands that enjoy recognition worldwide.

The group's flagship The Ascott luxury serviced residence brand projects an elegant lifestyle appealing to top executives. Its Somerset upper-tier brand offers stylish, contemporary living for senior to upper management executives. The mid-tier Citadines brand provides corporate executives with comfortable city residences.

Recent awards the group has clinched include the 2004 Business Traveller Best Serviced Residence Brand and Best Serviced Residence property in Asia Pacific awards. The group took the Number One position in the 2004 China's Top 100 Serviced Residences ranking for its eight properties in China. Ascott also won the 2004 Vietnam Economic Times' Best Service in Serviced Apartments awards in Hanoi and Ho Chi Minh City, and Best Annual Report and Best Operating & Financial Review awards at the 2004 Singapore Annual Report Awards.

Listed on the mainboard of the Singapore Exchange, Ascott is the serviced residence arm of CapitaLand Limited, one of Asia's largest listed property companies. Headquartered in Singapore, CapitaLand's core businesses in property, hospitality, property services and real estate financial services are focused in gateway cities in Asia, Australia and Europe. The company's hospitality businesses in hotels and serviced residences span more than 60 cities around the world.

For reservations on Ascott properties, call Central Reservations on (65) 6272-7272 or visit www.the-ascott.com