SINGAPORE (THE BUSINESS TIMES) – CapitaLand Investment (CLI) on Monday (July 4) announced that its wholly owned lodging business unit, The Ascott, is acquiring serviced apartment provider Oakwood Worldwide from Mapletree Investments.
While the purchase consideration was not disclosed, CLI estimates that the transaction will add some 81 properties and about 15,000 units to Ascott’s global portfolio.
About 8,500 of Oakwood’s operational units are expected to immediately contribute to Ascott’s recurring fee income streams upon the acquisition’s slated completion in the third quarter of this year.
Another 30 properties and 6,500 units are in the pipeline for Oakwood, bringing CLI’s global portfolio post-acquisition to more than 150,000 units in about 900 properties across over 200 cities in 39 countries.
With the acquisition of Oakwood, new markets added to Ascott’s portfolio will include Cheongju in South Korea, Zhangjiakou and Qingdao in China, Dhaka in Bangladesh, and Washington in the United States.
CLI said the broadened geographical diversification will provide further fee income stability for Ascott, placing CLI in a stronger position to take advantage of global travel recovery post-Covid-19.
Oakwood Premier Tokyo and Oakwood Premier Coex Centre Seoul count among Oakwood’s flagship properties. New properties from the apartment provider, such as Oakwood Premier Melbourne and Oakwood Hotel Oike Kyoto, will also add to the group’s destination highlights, said CLI.
“Ascott’s acquisition of Oakwood brings about an immediate boost to our units under management and franchise contracts,” said CLI’s chief executive for lodging, Mr Kevin Goh.
“We intend to build on the strong reputation and heritage of the Oakwood brand, especially in markets across South-east Asia, North Asia and North America. Oakwood will continue to grow alongside Ascott’s current portfolio of global brands as we continue to build growth momentum for our lodging business.”
Shares of CLI were trading up four cents, or 1.1 per cent, at $3.83 at 9.14am on Monday after the announcement.