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ASCOTT Residence Trust (ART) has announced its acquisition of a hotel in Tokyo's Shinjuku area for 8 billion yen (about S$95.2 million).
The acquisition will be accretive at an earnings before interest, tax, depreciation and amortisation (Ebitda) yield of 4.3 per cent and is expected to increase Ascott Reit's FY 2013 distribution per unit by 0.6 per cent from 8.40 Singapore cents to 8.45 Singapore cents on a pro forma basis.
The 206-unit hotel is the sixth property that ART has acquired this year. Its five earlier acquisitions are a rental housing property in Fukuoka, Japan, and four serviced residences in Kuala Lumpur, and in China's cities of Dalian, Wuhan and Xi'an.
ART is buying the Shinjuku hotel - now operating as Best Western Shinjuku Astina - from Kabushiki Kaisha Oumi, a Japanese property company.
The hotel opened in March 2008 and was valued at 8.4 billion yen (around S$100 million) as at Sept 10 this year. The acquisition will boost the trust's presence in a recovering hospitality market.
The property will be converted and rebranded into a Citadines serviced residence to be managed by The Ascott Limited in 2015.