CapitaLand Ascott Trust Expands Japan Portfolio with JPY21 Billion Hotel Acquisition

CapitaLand Ascott Trust (CLAS) has strengthened its footprint in Japan with the acquisition of two freehold hotels—ibis Styles Tokyo Ginza and Chisun Budget Kanazawa Ekimae—for JPY21 billion (S$178.5 million). The deal, secured at an 8.3% discount to independent valuation, is expected to enhance returns and further position CLAS for growth in Japan’s thriving hospitality sector.

Boosting Returns with Strategic Investments

On a FY 2024 pro forma basis, the acquisition is projected to increase Distribution per Stapled Security (DPS) by 1.6%, with a blended net operating income (NOI) yield of 4.3%. To hedge against currency fluctuations, CLAS financed the acquisition with JPY-denominated debt and proceeds from recent divestments in Japan.

Japan remains CLAS’ strongest-performing market, with revenue per available unit rising 37% year-on-year in 4Q 2024 to JPY23,987. Post-acquisition, CLAS’ Japan portfolio now includes two serviced residences, four hotels, 23 rental housing properties, and a student accommodation property.

Prime Locations to Capture Travel Demand

The newly acquired hotels are strategically located in high-traffic areas:

ibis Styles Tokyo Ginza (224 units) sits in the heart of Ginza, Tokyo’s premier shopping and entertainment district. Surrounded by luxury malls, flagship stores, and top-tier dining, the hotel is within an eight-minute walk to major subway stations, ensuring seamless connectivity.

Chisun Budget Kanazawa Ekimae (392 units) is located in Kanazawa, a historical city often compared to Kyoto for its rich cultural heritage. Near landmarks like Kanazawa Castle and Kenrokuen Garden, the property is five minutes from Kanazawa Station, providing access to Japan’s high-speed rail network and international connections to Seoul, Shanghai, and Taiwan.

Scaling Up with High-Yield Assets

With this latest acquisition, CLAS has invested approximately S$530 million in the past 12 months, securing assets at higher yields than its divestments. Notable 2024 acquisitions include:

• Teriha Ocean Stage (rental housing in Fukuoka) – January 2024
• Standard at Columbia (remaining 10% stake in a U.S. student accommodation) – June 2024
• lyf Funan Singapore – December 2024

In total, over S$500 million in divestments have been completed, unlocking approximately S$74 million in net gains.