(25/09/23) CapitaLand Ascott Trust (CLAS) has completed
the divestment of four serviced residences in regional
France to an undisclosed third party for a total of EUR44.4
million (SG$64.7 million based on an exchange rate of EUR1 to
SG$1.4568).
The four properties are Citadines Croisette Cannes, Citadines Prado Chanot Marseille, Citadines Castellane Marseille and Citadines City Centre Lille
(pictured below).
The
four properties were divested at 63% above book value (based on an
independent valuation dated 31 December 2022) and net
proceeds of the divestment is approximately EUR34.1 million
(SG$49.7 million).
The exit yield is about 4% and CLAS
received a net gain of approximately EUR1.2 million (SG$1.8
million).
Post-divestment, CLAS has 12 properties in France, predominantly located in Paris, including
La Clef Tour Eiffel Paris and Citadines Les Halles Paris that are
undergoing an 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.
Citadines City Centre Lille
“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,” said Serena
Teo, CEO of CapitaLand Ascott Trust Management
Limited and CapitaLand Ascott Business Trust Management. “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 SG$13.5
million and our Distribution per Stapled Security (DPS) by 1.8% on
a FY 2022 proforma basis upon completion of the acquisition. 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%.”
In August 2023, CLAS signed a memorandum of
understanding with its sponsor, 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 SG$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 SG$420 million in
15 accretive acquisitions, 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.
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