CapitaLand Ascott Trust completes divestment of four properties in regional France for EUR44.4 million
CapitaLand
Ascott
Trust
(CLAS)
has
completed
the
divestment
of
four
mature
serviced
residences
in
regional
France
to
an
unrelated
third
party
for
a
total
of
EUR44.4
million
(S$64.7
million1).
The
four
properties
are
Citadines
Croisette
Cannes,
Citadines
Prado
Chanot
Marseille,
Citadines
Castellane
Marseille
and
Citadines
City
Centre
Lille.
The
four
properties
were
divested
at
63%
above
book
value2
and
net
proceeds
of
the
divestment
is
approximately
EUR34.1
million
(S$49.7
million).
The
exit
yield3is
about
4%
and
CLAS
received
a
net
gain
of
approximately
EUR1.2
million
(S$1.8
million).
Post-divestment,
CLAS
has
12
properties
in
France.
The
properties
are
predominantly
located
in
Paris,
including
La
Clef
Tour
Eiffel
Paris
and
Citadines
Les
Halles
Paris
that
are
undergoing
asset
enhancement
initiative
(AEI)
to
uplift
their
value
and
profitability.
AEI
works
include
refurbishment
of
guest
rooms
and
general
public
areas
and
both
properties
will
remain
open,
receiving
rent
throughout
the
AEI.
Serena
Teo,
Chief
Executive
Officer
of
CapitaLand
Ascott
Trust
Management
Limited
and
CapitaLand
Ascott
Business
Trust
Management
Pte.
Ltd.
(the
Managers
of
CLAS),
said:
“We
have
divested
the
four
mature
properties
as
part
of
our
active
portfolio
reconstitution
strategy
to
deliver
sustainable
returns
to
our
Stapled
Securityholders.
As
these
properties
have
reached
the
optimal
stage
of
their
life
cycles,
the
divestment
enables
CLAS
to
redeploy
the
proceeds
to
higher-yielding
assets.
Proceeds
from
the
divestment
will
be
used
for
our
AEI
in
Europe.
It
will
also
be
used
to
partially
finance
CLAS’
recent
proposed
acquisition
of
three
prime
lodging
assets
in
the
capital
cities
of
London,
Dublin
and
Jakarta.”
“Over
the
past
three
years,
we
have
successfully
divested
properties
at
a
premium
to
book
value
and
invested
the
proceeds
in
higher-yielding
assets,
increasing
our
total
distribution.
With
the
recent
proposed
acquisition,
we
expect
to
further
increase
our
total
distribution
by
S$13.5
million
and
our
Distribution
per
Stapled
Security
(DPS)
by
1.8%
on
a
FY
2022
pro
The
EBITDA
yield
of
the
proposed
acquisition
is
6.2%5
on
a
FY
2022
pro
forma
basis,
more
than
2%
higher
than
the
exit
yield
from
the
divestment
of
the
four
properties
in
regional
France.
Post-renovation
for
The
Cavendish
London
and
Temple
Bar
Hotel
as
well
as
Milestone
Payments
for
the
acquisition,
we
expect
to
achieve
an
increased
yield
of
6.8%,”
added
Ms
Teo.
In
August
2023,
CLAS
signed
a
Memorandum
of
Understanding
(MOU)
with
its
sponsor,
The
Ascott
Limited
(Ascott),
for
a
proposed
accretive
acquisition
of
three
lodging
assets
–
a
hotel
in
London,
The
Cavendish
London;
a
hotel
in
Dublin,
Temple
Bar
Hotel;
and
a
serviced
residence
in
Jakarta,
Ascott
Kuningan
Jakarta
–
at
an
agreed
property
value
of
S$530.8
million.
The
proposed
acquisition
is
part
of
CLAS’
ongoing
efforts
to
enhance
its
portfolio
through
yield
accretive
investments
and
AEIs.
In
FY
2022,
CLAS
invested
S$420
million
in
15
accretive
acquisitions6,
which
contributed
to
the
increase
in
CLAS’
DPS
in
1H
2023.
The
new
properties
are
largely
longer-stay
properties
with
average
occupancy
rates
of
over
95%,
further
enhancing
CLAS’
stable
income
streams.
In
1H
2023,
CLAS’
DPS
increased
by
19%
year
on-year
to
2.78
cents.
