SINGAPORE - ARA Asset Management Limited announced on Monday (Dec 3) the acquisition of a portfolio of 38 select-service hotels, branded as Hyatt Place and Hyatt House, across 21 states in the US.
ARA said the completed acquisition, which is part of its global expansion plans over the past year, signifies a key milestone for the group as it makes its maiden entry into the United States. It did not disclose the cost of the acquisition.
John Lim, group CEO of ARA, said: "We will look at injecting this quality portfolio into our growing Reits (real estate investment trust) and private fund platforms in the near future as part of our multi-platform, multi-product global fund management strategy."
ARA, which was bought out and delisted last year, is one of the largest Reit managers in Asia. The group directly manages Fortune Reit, dual-listed in Singapore and Hong Kong; Suntec Reit and Cache Logistics Trust, listed in Singapore; and Hui Xian Reit and Prosperity Reit, listed in Hong Kong. It also indirectly manages Reits in Japan and Australia through its associate companies.
The acquisition extends the group's global footprint to 99 cities in 21 countries.
ARA said it will open an office in Dallas, Texas, that will serve as its base of operations in the US, led by Jin Y Lee, an industry veteran with more than 25 years of experience in the hospitality sector. The office will provide key functions, such as investment and asset management, business development and related services.
Mr Lim added that "we are confident of the US hospitality sector, particularly in select service hotels, where entry yields remain attractive".
ARA said the US select-service sector - which offers efficient, economical hotel rooms to business travellers - has outperformed the full-service sector over the past two decades due to its simpler operating model and steady demand. It added that the sector is supported by a robust US economy which is anticipated to grow close to 3 per cent in 2018, and a positive long-term business outlook.