CapitaLand Investment establishes CLARA II to invest in lodging properties - Singapore News

Source: The Independent
Author: Mary Alavanza

SINGAPORE: CapitaLand Investment establishes CLARA II to invest in lodging properties. The company has set its sights on expanding its presence in the lodging sector with the establishment of the CapitaLand Ascott Residence Asia Fund II (CLARA II), The Edge Singapore reports.

This move comes in response to a rising demand for lodging properties across key developed Asia Pacific (APAC) markets.

CLARA II, with a target equity size of S$800 million (US$600 million), is CLI's latest venture into serviced residences and coliving properties. It marks the second private fund of its kind for CLI, following the successful S$800 million (US$600 million) Ascott Serviced Residence Global Fund (ASRGF).

Tos strengthen its funds under management (FUM) while maintaining an asset-light approach, CLI will retain a 20% stake in CLARA II, with the remaining 80% allocated to third-party institutional investors.

Leveraging the operational expertise of CLI's lodging arm, The Ascott Limited, CLARA II aims to manage a portfolio of resilient and green-certified lodging assets.

CLARA II has already secured commitments from global institutional investors across Europe and Asia, kickstarting its investment journey with the acquisition of two seed assets.

These include a 50% stake in the 308-unit lyf Bugis Singapore and full ownership of the 200-unit lyf Shibuya Tokyo in Japan, both strategically located within bustling city centres.

Scheduled to open in mid-2024 and 4Q2024, respectively, these properties are poised to meet the stringent standards of green certification.

Kevin Goh, CEO of CLI Lodging and Ascott, expresses confidence in the venture, stating:

"Combining CLI's investment management capabilities and Ascott's expertise in operating lodging properties worldwide under our award-winning brands, we are well-positioned to support the growth of our private funds."

Goh continues, "Tapping on travellers' preference for trusted brands, CLARA II will leverage Ascott's global operational expertise, and sales and marketing network. This enables us to enhance the value of the assets and deliver sustainable returns to investors.

Investors will further benefit from the strong demand for lodging as international travel continues its upward trajectory. Besides Asia Pacific, we see the potential to establish more lodging private funds in other regions such as Europe."

Investor interest in serviced residences and coliving properties has surged, particularly in the wake of the Covid-19 pandemic.

Mak Hoe Kit, managing director of lodging private equity funds at CLI, highlights the resilience of these assets, noting their ability to generate stable income from long-stay guests while remaining flexible to accommodate short-stay guests, thus maximising revenue.

"With trends such as increased global mobility, coliving becoming mainstream and travellers spending more time overseas, the sector is strategically positioned to offer attractive returns.

CLARA II will target markets that have strong economic fundamentals and transparent regulations. We see good investment and value-add opportunities in these key developed Asia Pacific markets."/TISG