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Singapore, 22 October 2024 – CapitaLand Ascott Trust (CLAS) has entered into an agreement to divest Somerset Olympic Tower Tianjin in China to an unrelated third party.  The 185-unit property will be divested at above book value^[1], unlocking gains for CLAS’ Stapled Securityholders.  The transaction, subject to customary conditions precedent, is expected to be completed in 2Q 2025.  Somerset Olympic Tower Tianjin, which opened in 1998, is located in Heping District.

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: “We continually reconstitute CLAS’ portfolio by divesting mature properties such as Somerset Olympic Tower Tianjin and redeploying the proceeds towards more optimal uses.  In 1H 2024, CLAS’ properties in China contributed 1.4% to our total gross profit.  The divestment of Somerset Olympic Tower Tianjin will have minimal impact on our gross profit.  Post divestment, we will have four properties^[2] in China.  With CLAS’ strong financial position, we stand ready to capture opportunities to deliver accretive growth for our Stapled Securityholders.”

Strengthening CLAS’ portfolio through its portfolio reconstitution strategy
Prior to Somerset Olympic Tower Tianjin, CLAS has divested a total of close to S$400 million in assets year to date.  The properties were divested at a premium to book value, unlocking about S$54 million^[3] in gains.  CLAS also announced on 1 October 2024 that it will deploy proceeds from the divestment of Citadines Mount Sophia Singapore into the proposed acquisition of lyf Funan Singapore at an entry earnings before interest, taxes, depreciation and amortisation (EBITDA) yield of 4.7%^[4], delivering accretion to Stapled Securityholders.  Citadines Mount Sophia Singapore was divested in March 2024 at an exit yield of 3.2%. 

Other acquisitions include a rental housing property in Fukuoka, Japan and the remaining 10% stake in Standard at Columbia, a student accommodation property in the United States of America in 1H 2024.

CLAS has also recently completed the asset enhancement initiative (AEI) for Citadines Holborn-Covent Garden London.  Year to date, CLAS has completed AEIs for five of its properties^[5].  CLAS has three^[6] properties in its AEI pipeline to be completed between 4Q 2024 and 2026.  These initiatives, when completed, are expected to enhance the quality of CLAS’ portfolio and uplift its distribution income.

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^{Notes
[1]  More details to be provided upon completion.
[2]  The four properties are Citadines Xinghai Suzhou, Citadines Zhuankou Wuhan, Somerset Grand Central Dalian and Somerset Heping Shenyang.
[3]   Includes the transfer of S$19.3 million from the asset revaluation reserve to revenue reserve for the divestments in Australia.
[4]  The EBITDA yield is computed based on the FY 2023 EBITDA and agreed property value of lyf Funan Singapore.
[5]  The Robertson House by The Crest Collection in Singapore, Citadines Les Halles Paris, Citadines Kurfürstendamm Berlin, La Clef Tour Eiffel Paris and Citadines Holborn-Covent Garden London.
[6]  Temple Bar Hotel Dublin, The Cavendish London and Sydney Central Hotel.}