The wholly-owned lodging business unit of CapitaLand, The Ascott Ltd. (Ascott), on June 21 entered into two agreements to acquire two properties in Paris, France and Hanoi, Vietnam for approximately $155 million.
|CapitaLand's Somerset Metropolitan West Hanoi is the 364-unit project located in Hanoi’s new Central Business District and is expected to open in 2024 |
The acquisition of the two properties through the Ascott Serviced Residence Global Fund (ASRGF), Ascott’s private equity fund with Qatar Investment Authority, will boost Ascott’s total fund assets under management (FUM) to about S$8 billion ($5.94 billion). Both properties will be acquired on a turnkey basis and are expected to open in 2024.
Named livelyfhere Gambetta Paris, the 139-unit coliving property is located in a vibrant district in the 20th arrondissement, near galleries, cinemas, trendy cafés and restaurants, street art and music venues. With this addition, Ascott has a total of 16 lyf properties with more than 3,100 units across 13 cities and nine countries in the Asia-Pacific and Europe.
The acquisition in Hanoi is the 364-unit Somerset Metropolitan West Hanoi. It is located in Hanoi’s new Central Business District, close to several government agencies as well as local and international corporations. Somerset Metropolitan West Hanoi is a 10-minute drive to the Vietnam National Convention Centre, the largest convention centre in Vietnam and 30 minutes from Noi Bai International Airport.
According to Kevin Goh, CapitaLand’s CEO for Lodging, Ascott Serviced Residence Global Fund and its sponsored hospitality trust, Ascott Residence Trust are key investment platforms to grow its FUM in a capital-efficient manner.
“Our interests are aligned with both our private and public investors, as we put our own capital to work alongside theirs, bringing the strengths of our global reach and operating expertise to deliver the required investment returns. We are therefore seeing strong growth momentum from fee-related earnings (FRE) generated through the management of our private fund and the listed hospitality trust as well as recurring fees earned from asset management and property management,” said Goh.
He added that the acquisition of these two prime properties in France and Vietnam is in line with Ascott’s ambition to expand its global lodging business.
With a presence in over 190 cities across over 30 countries, the scale of our operations worldwide gives Ascott favourable access to proprietary deal flows.
“We are looking to work with like-minded capital partners to set up new funds to expand in resilient asset classes, such as coliving and student accommodation, to accelerate our FUM and FRE growth. Concurrently, we continue to secure more third-party management contracts and franchises to increase Ascott’s property fee income,” he added.
With the acquisition of livelyfhere Gambetta Paris and Somerset Metropolitan West Hanoi, there will be eight properties with close to 1,700 units held under ASRGF. The fund has five operational properties: Ascott Sudirman Jakarta, Citadines Islington London, La Clef Champs-Élysées Paris, lyf Funan Singapore, and Quest NewQuay Docklands Melbourne. Citadines Walker North Sydney is slated to open in 2022.
In Vietnam, Somerset Metropolitan West Hanoi will increase Ascott’s portfolio to over 7,600 units across 31 properties in 10 cities. In addition to the gateway cities of Ho Chi Minh City and Hanoi, Ascott also has properties in cities such as Binh Duong, Cam Ranh, Danang, Haiphong, Halong, Hoi An, Nha Trang, and Vung Tau.