CapitaLand’s wholly owned lodging business unit, The Ascott Limited (Ascott) has added a record of over 14,200 units across 71 properties globally for 2020. Despite COVID-19, this exceeds the number of units secured in 2019, marking a fourth consecutive year of record growth for Ascott. In China, Ascott has also achieved an 80% year-on-year growth in units compared to 2019. The new properties secured will boost Ascott’s annual fee income by over S$27 million as they progressively open and stabilize.
Since October 2020, Ascott added more than 4,900 units across 23 properties. This includes over 3,800 units across 17 properties in China. Ascott will make its first foray into the city of Yangzhou while expanding in other cities such as Beijing, Chengdu, Chongqing, Guangzhou, Hangzhou, Shanghai, Shenzhen and Wuhan. Among the newly secured properties are two rental housing properties in Shanghai and Hangzhou, marking Ascott’s increased presence in China’s high growth rental housing sector. As China continues to urbanise, an estimated 252 million tenants will make up a RMB3 trillion rental market by 2025.
Outside of China, Ascott has sealed contracts for over 1,000 new units across 6 properties. They are in markets such as Doha, Qatar; Manila, Philippines; Singapore; Sydney, Australia; as well as Binh Duong and Danang in Vietnam where Ascott will introduce its first lyf coliving property and first Citadines Connect business hotel in the country.
Mr Kevin Goh, CapitaLand’s Chief Executive Officer for Lodging and Ascott’s Chief Executive Officer, said: “COVID-19 has validated the resilience of Ascott’s business model as property owners continue to sign new management and franchise contracts with us, allowing us to achieve our fourth consecutive year of record growth in 2020. Through these new contracts, we continue to build our future recurring fee income stream. In 2021, over 80 properties with about 17,000 units are slated to open across the world. This includes over 70 properties with more than 15,000 units in Asia Pacific which is expected to lead the global economic recovery. We will continue to look for opportunities to expand our presence through management contracts, franchises, strategic alliances, and stand ready to seize good investment opportunities.”
Mr Goh added: “While we were not spared the short-term operational impact of COVID-19, we believe that the fundamental demand for lodging remains intact and will bounce back quickly once the global pandemic is brought under control. In the meantime, we continue to seek new opportunities amid the crisis. We have capitalised on Ascott’s well-designed and spacious serviced apartments to tap on domestic demand while pursuing new businesses. Ascott’s new businesses such as the ‘Work in Residence’ and ‘Space-as-a-Service’ initiatives have generated more than S$91 million in 2020. With the global roll out of vaccines and testing protocols to facilitate the gradual resumption of international travel, Ascott will emerge stronger and deliver greater value for our partners and guests.”
Mr Tan Tze Shang, Ascott’s Managing Director for China and Head of Business Development for China, said: “Ascott’s business in China continues to lead our global expansion. We have achieved record growth in new units and about half of the properties opened globally are in China. In key cities, our properties such as Ascott Heng Shan Shanghai, Ascott Aden Shenzhen, Ascott IFC Guangzhou, and Raffles City Residence Beijing, have strong average occupancy rate of over 90%. In 2021, we are slated to open three lyf coliving properties in Hangzhou, Shanghai and Xi’an to cater to the fast-expanding demographic of millennial and millennial-minded customers. The first of our three rental housing properties in China is also slated to open in Hangzhou in 3Q 2021. These new lodging options will enable Ascott to expand our customer reach and product offerings to business partners in China.”
Mr Tan added: “Ascott’s expansion into the rental housing segment taps on the growing demand from young, mobile workers as well as returning students from abroad who are looking to rent quality fully furnished homes in the tier one and tier two cities on a long-term basis in China. We have also infused new technologies into the more traditional rental housing sector by enabling our guests to pay rent and utilities, submit requests and book facilities digitally to increase guest satisfaction and improve operational efficiency.”
