The Ascott's serviced residence global fund with 50:50 partner Qatar Investment Authority (QIA) has acquired two prime properties in Paris and Tokyo for US$104 million (S$148 million).
The Ascott is the wholly-owned subsidiary of mainboard-listed Singapore property heavyweight CapitaLand.
The fund will invest another US$33 million to convert the office building in Paris, previously the private residence of the famous Hennessy family, into a luxury serviced residence as well as embark on asset enhancement to reposition the serviced residence in Tokyo, bringing the total investment to US$137 million, CapitaLand and The Ascott said yesterday in a joint release.
The 70-unit Citadines Suites Champs-Elysees Paris is slated to open in 2018.
The serviced residence that has been operating as Somerset Shinagawa Tokyo since acquisition will undergo asset enhancement to reposition the property with additional apartments to be reconfigured.
This is expected to be completed by end 2016.
With these acquisitions, The Ascott now has more than 43,000 units across 277 properties, spanning 95 cities, cementing its position as the world's largest international serviced residence owner and operator, the companies said.
Set up in July this year, the US$600 million serviced residence global fund is The Ascott's largest private equity fund and a 50:50 joint venture with QIA.
The fund invests in serviced residences and rental housing properties with an initial focus on the Asia-Pacific and Europe.
"As we gear up to achieve The Ascott's expansion target of 80,000 units worldwide by 2020, the fund provides the financial boost to support our acquisitions and growth," said Mr Lee Chee Koon, The Ascott's chief executive officer.
"With the first right to manage properties acquired by the fund, we will be able to increase The Ascott's fee-based income."