SINGAPORE - CapitaLand's wholly owned serviced residence arm, The Ascott Ltd, is investing S$81.5 million to acquire and refurbish The Domain Hotel in Silicon Valley, California, to capture the fast-growing demand from global technology companies and multinational corporations.
The freehold property is Ascott's fourth acquisition in the US within five months. Ascott has more than tripled last year's portfolio to over 2,900 units in the country.
The 136-unit hotel will continue to operate as it undergoes refurbishment in phases before being rebranded to Citadines Cupertino Sunnyvale in the fourth quarter of next year.
This will be Ascott's second Citadines-branded property in the US, following its acquisition of Hotel Central Fifth Avenue New York in May. The latter will be renovated and rebranded to Citadines Fifth Avenue New York in 2018.
Ascott CEO Lee Chee Koon said: "We are acquiring Ascott's first property in Silicon Valley which will allow us to invest in one of the most desirable property markets in the US. Silicon Valley has a high growth economy and is home to some of the world's biggest and leading technology companies and multinational corporations, generating significant demand for accommodation.
"Our recent majority-stake acquisition of Synergy Global Housing in the US will also enable Ascott to capitalise on its strong customer base of Fortune 500 companies and major Silicon Valley technology firms."
Mr Lee said the Citadines is Ascott's fastest-growing brand with close to 20,000 units in Asia Pacific, Europe and the Middle East.
"By stepping up our Citadines presence in the US, we will increase its reach to American travellers, our third largest source market, and cross sell to our properties outside the US."
He added that the company will continue to seek opportunities in the US in cities such as New York, Boston, Los Angeles, San Francisco and Washington DC.
The Domain Hotel is situated along Sunnyvale's primary thoroughfare, El Camino Real, that leads to San Francisco City and San Jose. Companies and startups in that location include Apple's new US$5 billion headquarter campus, which will accommodate more than 12,000 employees, Google, Amazon, Adobe, Intel, Netflix, Nvidia, PayPal and Telsa Motors.