Singapore: CapitaLand Investment (CLI) is seeking to raise $600 million for a new Asia Pacific fund targetting serviced residence and coliving opportunities which it is seeding with a pair of assets from its Ascott lodging division.
CapitaLand Ascott Residence Asia Fund II (CLARA II), which targets key cities across Asia Pacific, has already achieved a first closing on an unspecified amount of capital, through backing from both European and Asian institutional investors, CapitaLand said.
The new vehicle will be seeded with two coliving properties to be acquired from Ascott, including a half stake in Singapore’s Hotel G, which the lodging operation and investment firm acquired from Hong Kong’s Gaw Capital in a 50:50 joint venture with CapitaLand Wellness Fund, a south-east Asia-focused private vehicle which Capitaland set up in October.
“CLARA II will target markets that have strong economic fundamentals and transparent regulations,” said Mak Hoe Kit, managing director for lodging private equity funds at CLI. “We see good investment and value-add opportunities in these key developed Asia Pacific markets.”
CLI said it will retain a 20 per cent stake as sponsor of the new fund while third-party investors will hold the remaining 80 per cent.
The new vehicle is being established as a follow-on fund to the Ascott Serviced Residence Global Fund (ASRGF) set up by Ascott Ltd as a 50:50 joint venture with the Qatar Investment Authority in 2015.
The new fund will start off with 308 rooms from the Hotel G and Lyf Shibuya Tokyo, with the fund acquiring a 100 per cent stake in that 200-unit Japanese property from Ascott for an unspecified amount.
The Tokyo property is one of eight new Lyf locations Ascott announced last month, and is scheduled to open during Q4 of this year.
Ascott will manage the assets. Kevin Goh, chief executive officer for Ascott and CLI Lodging, said: “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. With trends such as increased global mobility, co-living becoming mainstream and travellers spending more time overseas, the sector is strategically positioned to offer attractive returns.”
Goh said CLI is also looking at establishing lodging private funds in Europe and other regions.
