Ascott Strengthens Foothold in China With S$151 Million Acquisition Of Two Properties
Singapore, 1 August 2006 – The Ascott Group (Ascott) has signed heads of agreements to acquire two properties in China for S$151.4 million (RMB 768.7 million) including development costs. The acquisition of these properties is in line with Ascott’s target to triple its portfolio in China to 10,000 units by 2010.
The two properties in Beijing and Tianjin, with a total of 422 units bring Ascott’s portfolio in China to over 3,400 units in 18 properties. These properties will be operated and managed by Ascott; they form the pipeline of assets for potential injection into Ascott Residence Trust.
Mr Cameron Ong, Ascott’s Managing Director and CEO said, “Since Ascott’s entry into China about 10 years ago, we have made an accumulated investment of over S$630 million (RMB 3.2 billion). The additional investment in these two new properties brings our total investment in China close to S$782 million (RMB 4 billion). This further demonstrates the importance of China as a key growth market for Ascott. The China government’s recent real estate regulations bode well for long term players like Ascott as they will minimise speculative investments and weed out the weaker players in the long run.”
“Ascott will be able to see immediate returns and a stable flow of income from the property in Beijing as it is already a fully-furnished operating serviced residence. This acquisition also enhances our presence in the Chinese capital to cater to the expected increase in demand for accommodation leading up to the 2008 Olympics and beyond. The Tianjin acquisition is strategic given its prime location in one of China’s key development zones with high growth potential. Youyi Road, where our property is located, is slated to be Tianjin’s financial hub. Moving forward, besides acquisitions of suitable greenfield projects, Ascott will also be looking at opportunities to acquire existing buildings for conversion into serviced residences, to achieve efficient ‘time-to-market’,” added Mr Ong.
Beijing and Tianjin offer significant growth opportunities for serviced residences given the limited supply of high quality and professionally-managed serviced residences. Demand from expatriates and business travellers for top quality serviced residences is also expected to grow in tandem with the influx of foreign investment and growing number of multinational corporations in these areas.
Somerset ZhongGuanCun, Beijing
Ascott is acquiring a fully-furnished 17 storey, 154-unit serviced residence, known as Laccueil Residence for a purchase price of S$59.5 million (RMB 302 million). The deal was made with Beijing Yuanzhong Real Estate Development Co Ltd. Ascott intends to invest an additional S$6.6 million (RMB 33.7 million) for minor refurbishments.
The property at 15, Hai Dian Middle Street in Haidian District of Beijing is in the heart of ZhongGuanCun, a high-technology development zone. The zone houses over 1,400 foreign invested enterprises including 43 Fortune 500 companies, and about 3,000 to 5,000 expatriates.
Somerset ZhongGuanCun, Beijing is targeted to open in the first half of 2007 with one, two and three-bedroom units.
Somerset Youyi, Tianjin
Ascott is acquiring a partially completed 35-storey building called Junyi Building, in its bare shell status for a purchase price of S$57.5 million (RMB 292 million). The deal was made with Tianjin Construction Group Real Estate Development Co Ltd. Ascott intends to invest another S$27.8 million (RMB 141 million) to retrofit the property into a high-end serviced residence.
Located at 35, Youyi Road, Hexi District in Tianjin, the 268-unit building is close to Tianjin International Exhibition Centre. It will cater to expatriates working in two of Tianjin’s key industrial development zones; Tianjin Economic Technological Development zone and Xiqing Economic Development zone. Currently, about 17,000 expatriates are working in Tianjin on a long-term basis.
Somerset Youyi, Tianjin is targeted to open in the first half of 2008 with studio, one-bedroom and two-bedroom units.
The Ascott Group is the largest international serviced residence operator in China with presence in seven Chinese cities including Beijing, Dalian, Guangzhou, Shanghai, Suzhou, Tianjin and Xi’an, as well as the territory of Hong Kong.
About The Ascott Group
The Ascott Group is the largest international serviced residence owner-operator outside the United States with more than 16,000 serviced residence units in key cities of Asia Pacific, Europe and the Middle East.
The Group operates three brands – The Ascott, Somerset and Citadines in 43 cities in 17 countries. These include London, Paris, Brussels, Berlin and Barcelona in Europe; Singapore, Bangkok, Pattaya, Hanoi, Kuala Lumpur, Tokyo, Seoul, Shanghai, Beijing, Xi’an and Hong Kong in Asia; Sydney, Melbourne and Auckland in Australia / New Zealand as well as Dubai in the Middle East.
The Ascott Group is headquartered in Singapore. It pioneered Asia Pacific's first branded luxury serviced residence in 1984. It also established the world’s first pan-Asian serviced residence real estate investment trust, Ascott Residence Trust in 2006. Today, the Group boasts a 22-year industry track record and serviced residence brands that enjoy recognition worldwide.
The Ascott Group’s achievements have been recognised internationally; it has clinched numerous prestigious awards including the ‘Most Outstanding International Brand’ award from Apartment Living magazine in Thailand, ‘2006 Korea Top Brand’ award by Seoul Economy newspaper, Korea Herald’s ‘Readers’ Best Brand Awards 2006’, ‘2006 Best Company & CEO’ award from the Herald Business in Korea, the ‘Best Serviced Residence Brand’ award by Lifestyle + Travel magazine in Thailand, the ‘Innovative Capital Venture’ award at the 2006 China Hotel Investment Summit, 2006 ‘China’s Top 100 Serviced Apartments’ award, Korea Times’ ‘Best International Serviced Residence Brand’ award, the ‘Highly Commended Deluxe Accommodation’ award at the 2005 Tasmanian Tourism Awards, ‘Best Accommodation’ at the 2005 World Travel Awards, TTG Asia Media’s 2005 ‘Best Serviced Residence Operator’ award, and the Business Traveller Asia Pacific’s 2005 ‘Best Serviced Residence Brand’ and ‘Best Serviced Residence’ awards. For a full list of awards, please visit : https://www.the-ascott.com//aboutus/awards_and_accolades.html?year=2007
Listed on the mainboard of the Singapore Exchange, The Ascott Group is the serviced residence arm of CapitaLand Limited, one of Asia’s largest listed property companies. Headquartered in Singapore, the multinational company's core businesses in property, hospitality and real estate financial services are focused in gateway cities in Asia Pacific, Europe and the Middle East. Its property and hospitality portfolio spans more than 70 cities in 18 countries.
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