Ascott Residence Trust kept at ‘hold’ by CIMB with $1.16 target price

SINGAPORE (June 29): CIMB has maintained its “hold” call for Ascott Residence Trust (ART), with a target price of $1.16, according to a report dated Tuesday.

ART provides unique exposure to the corporate long-stay segment through its serviced residences (SRs), currently comprising 90 properties with 11,667 units in 38 cities spread across 14 countries. Describing SRs as a resilient accommodation model, the research house believes that demand for SRs will continue to rise with increased awareness of their value propositions.

Unitholders of ART are also able to enjoy income stability as the average stay of ART’s SRs is around four months as compared to the more volatile nature of hotel stays. Moreover, ART’s master leases and management contracts with minimum income also support income stability, contributing about 46% to ART’s gross profits in FY15.

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