CapitaLand’s wholly owned serviced residence business unit, The Ascott Limited (Ascott), is investing S$170.3 million ($125.1 million), with Qatar Investment Authority (QIA) in the serviced residence component of the Funan integrated development.
Of the S$170.3 million, the fund is acquiring the land for the serviced residence component from CapitaLand Mall Trust (CMT) for S$90.5 million and developing the Singapore flagship of Ascott’s millennial-focused lyf brand on the site for an estimated S$80 million.
To be named lyf Funan Singapore, the prime property will be designed by millennials for millennials in the heart of Singapore’s Civic & Cultural District.
The nine-storey co-living property spans about 121,000 square feet in gross floor area. Slated to open in 2020, it will provide 279 units with the flexibility to offer up to 412 rooms.
lyf Funan Singapore is an integral part of Funan which also comprises a mall and two office towers offering cutting-edge retail innovations and co- working spaces, for customers to enjoy a complete live-work-play experience within the integrated development.
The acquisition also cements Ascott’s position as the largest and fastest growing serviced residence operator in Singapore with close to 2,000 units in 12 properties.
lyf Funan Singapore is Ascott’s fifth acquisition under its serviced residence global fund with committed equity of $600 million (S$809 million), which was set up through a 50:50 joint venture with QIA in July 2015. Ascott’s largest private equity fund has committed total investment amount of S$533 million to date to lyf Funan Singapore,
Lee Chee Koon, Ascott’s Chief Executive Officer, said: “Ascott is expanding at our fastest pace ever in Singapore and is now the country’s biggest serviced residence operator with close to 2,000 units in 12 properties. Singapore has seen historical highs in tourist arrival and spending last year, and was ranked the top Asian city for expatriates, with the best infrastructure in the world.”
“Given its strong economic fundamentals and position as one of the top global fintech hubs4, Singapore is a key market for us to reach out to the millennial-minded consumers with our lyf brand, as we continue to expand with our established Ascott, Citadines, Somerset, Quest and The Crest Collection brands,” he adds.
According to Lee, Ascott has invested approximately S$480 million on acquisitions and made strategic acquisitions such as Quest Apartment Hotels in Australasia, Synergy Global Housing in the U.S. and Tujia in China.
The firm has added over 20,000 units to its portfolio, almost double the number of units secured for the whole of 2016; it targets to have 20,000 units in its portfolio in 2020.
Ascott expects growing demand from local and foreign business executives, in addition to emerging market segments such as startup founders and entrepreneurs, to drive business growth.