The Ascott Limited, the wholly-owned lodging business unit of CapitaLand Limited, has signed over 8,300 units across over 30 properties in the first seven months of 2021.
The figure represents an over 40% growth y-o-y compared to the same period in 2020.
It also represents a compound annual growth rate (CAGR) of 20% since 2017.
The new units include Ascott’s new contract to manage the largest serviced residence development in Vietnam with over 1,900 units.
Ascott will also be signing on another Citadines property in Hanoi in July.
In addition, the lodging business has secured two management contracts for the first time in Lao Cai, a Citadines-branded serviced apartment and the first Preference-branded hotel in Vietnam.
See also: CapitaLand's Ascott acquires properties in Paris and Hanoi for $210 mil through global fund
Up to July, Ascott has achieved a record of over 2,800 new units in Vietnam.
In the first seven months of 2021, Ascott has also added 2,900 new units in China across 12 properties in the cities of Hefei, Ningbo, Shanghai, Shenyang, Shenzhen, Wuhan and Xi’an.
Ascott adds that it will be making its entry into Senegal, and has signed new properties in Australia, Cambodia, France, Indonesia, Malaysia and Morocco. The properties are slated to open between 2022 and 2027.
The lodging business expects to see increased fee income contribution once units in the pipeline turn operational, with $20 million to $25 million of fees set to be earned for every 10,000 stabilised serviced residence units.
Ascott has, to date, over 128,000 units around the world. It is on track to achieving its goal of having 160,000 units by 2023.
“This year, we continued to achieve strong growth by stepping up our expansion with more management contracts and strategic partnerships. We have opened over 3,000 units in 13 properties in China, Indonesia, Japan, Philippines, Singapore and Vietnam,” says Kevin Goh, CapitaLand’s CEO for lodging.
“We expect to open about 50% more units than last year… The newly secured properties will increase Ascott’s recurring fee income as they open and stabilise, adding on to the over S$195 million in fee income contributed by our operational units in 2020. We have also increased our Fee Related Earnings (FRE) and expanded our Funds Under Management (FUM) to S$8 billion to date through a private fund as well as our sponsored Ascott Residence Trust,” he adds.
Units in Ascott Residence Trust closed 3 cents lower or 2.9% down at $1.01 on July 19, while shares in CapitaLand closed 7 cents higher or 1.8% up at $3.88.
Photo: Ascott
