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Ascott increases presence in Australia
CAPITALAND'S The Ascott has inked several agreements with Quest Serviced Apartments in Australia to increase its exposure Down Under.
Under one of the agreements, Ascott's real estate investment trust, Ascott Residence Trust (Ascott Reit) will acquire three operating serviced residences in Greater Sydney from Quest for A$83.0 million (about S$93.0 million).
These are Ascott Reit's maiden acquisitions in New South Wales.
The Reit will receive fixed rent by taking over the leases for the serviced residences - Quest Sydney Olympic Park, Quest Campbelltown and Quest Mascot. They will continue to be operated under franchises using the Quest brand.
Quest is the largest serviced apartment provider, with 112 properties in Australia.
Ascott will also bulk up on its exposure to the Australia market, with plans to invest up to A$500 million (S$560 million) to acquire new properties that Quest will secure for its franchise in Australia over the next five years. Ascott will have a right of first refusal to acquire the properties sourced by Quest. Quest will then provide a lease for the properties, which will be operated under franchises using its brand.
In addition, Ascott has signed an agreement to acquire a 20 per cent stake in Quest for A$28.8 million (S$32.3 million). Under this agreement, Ascott has the option to raise its stake in Quest to 30 per cent.