CapitaLand’s hotel unit Ascott buys first Silicon Valley property for $59.9m

The Domain Hotel

Singapore-based CapitaLand’s serviced residence unit The Ascott Ltd  is investing $59.9 million (S$81.5 million) to acquire and refurbish its first property in Silicon Valley, the fourth acquisition in US for Ascott within five months.

The latest acquisition, The Domain Hotel, is situated along Sunnyvale’s primary thoroughfare, El Camino Real, that leads to San Francisco City and San Jose. The property is surrounded by numerous renowned corporations and startups including Apple’s new $5 billion headquarter campus, which will accommodate more than 12,000 employees, Google, Amazon, Adobe, Intel, Netflix, Nvidia, PayPal and Tesla Motors.

The latest acquisition is aimed at capturing the fast-growing demand from global technology companies and multinational corporations, Ascott said in a statement issued on Thursday.

The 136-unit hotel will continue to operate as it undergoes refurbishment in phases before being rebranded to Citadines Cupertino Sunnyvale in the fourth quarter of 2018, it said.

This will be Ascott’s second Citadines-branded property in the US, following its acquisition of Hotel Central Fifth Avenue New York in May this year. The latter is also set to be renovated and rebranded to Citadines Fifth Avenue New York in 2018.

Ascott has more than tripled last year’s portfolio to over 2,900 units. It is aiming to surpass its target of 80,000 units globally by 2020 and continues to seek opportunities in the U.S. in cities such as New York, Boston, Los Angeles, San Francisco and Washington DC.

“We are acquiring Ascott’s first property in Silicon Valley which will allow us to invest in one of the most desirable property markets in the U.S. Silicon Valley has a high growth economy and is home to some of the world’s biggest and leading technology companies and multinational corporations, generating significant demand for accommodation,” said Ascott CEO Lee Chee Koon.

He added that the recent majority-stake acquisition of Synergy Global Housing in the US will also enable Ascott to capitalise on its strong customer base of Fortune 500 companies and major Silicon Valley technology firms. Together with its five properties in the US, the serviced residence company claims to be in a good position to capture a ready pool of corporate clients.

CapitaLand, which is mainly known as a real estate firm, has in recent times evolved as an active investor. In August this year, the firm set up its first private equity fund in Vietnam closing at $300 million with a lifespan of eight years. The fund will invest in Grade A commercial real estate in Vietnam.

CapitaLand has also set up a private equity fund management business and consolidate its private equity real estate funds into one unit, CapitaLand Investment Management. It has roped in former HSBC real estate finance head James Lim to head it. CapitaLand is currently targeting to launch six new funds with total assets under management (AUM) of up to S$10 billion by 2020.

Also Read:

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CapitaLand launches first $300m Vietnam private equity fund

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.