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CapitaLand Ascott Trust divests three hotels in Japan for JPY10.7 billion

CapitaLand Ascott Trust (CLAS) is divesting three hotels in Osaka, Japan to an unrelated third party for a total of JPY10.7 billion

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Image by CapitaLand Ascott

(S$99.8 million).  The three properties are Hotel WBF Honmachi, Hotel WBF Kitasemba East and Hotel WBF Kitasemba West.

The three properties will be divested at about 15% above book value.  Net proceeds of the divestment are expected to be about JPY3.9 billion (S$36.4 million) and CLAS will recognise a net gain of JPY1.1 billion (S$10.1 million).  The divestment of the three properties is expected to be completed in 1Q 2024.

Ms Serena Teo, Chief Executive Officer of CapitaLand Ascott Trust Management Limited and CapitaLand Ascott Business Trust Management Pte. Ltd. (the Managers of CLAS), said: “The divestment of the three properties is part of our active portfolio reconstitution strategy.  The properties are situated outside the prime districts in Osaka and the divestment enables CLAS to unlock the value of the properties, redeploying capital to assets and/or asset enhancement initiatives that can generate stronger yields, uplifting the overall value of our portfolio.  Japan remains an attractive market for CLAS.  Its strong tourism sector receives robust demand from both international and domestic sources.  Population growth in the gateway cities also continues to rise with more locals moving into the urban cities.  The overall positive demand-supply dynamics bode well for our portfolio of hospitality and longer-stay assets in Japan.”

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“CLAS is set to complete a turnkey acquisition of a 258-unit rental housing property in Fukuoka, Japan in 1Q 2024.  Following the strong approval from our Stapled Securityholders, we have also completed the acquisition of three prime lodging assets in London, Dublin and Jakarta at an EBITDA yield of 6.2%.  The assets have begun contributing to CLAS’ income, enhancing our returns.  We remain focused on delivering long-term sustainable returns to our Stapled Securityholders,” added Ms Teo.

Tags: CapitaLand Ascott Trust, Japan, three hotels

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