CAPITALAND Investment’s (CLI) lodging arm The Ascott plans to achieve fee revenue of more than S$500 million over the next five years, about double of its FY2022 revenue of S$258 million.

Fee revenue growth will be driven by new property openings as well as new signings at an expected annual net room growth rate of 8 per cent to 10 per cent in the next five years, said the company on Thursday (Apr 20).

Ascott said it signed over 4,000 units in Q1 this year, which drove the company to exceed its earlier target of securing 160,000 units by 2023.

It also aims to open more than 13,500 units over 70 properties this year.

“Over 80 per cent of our total units are under management and franchise contracts, up from 43 per cent 10 years ago. These management and franchise contracts typically have sticky recurring fee revenue and long tenures,” said Kevin Goh, chief executive officer for Ascott and CLI Lodging.

“To achieve our new growth target, we will secure more management and franchise contracts for prime properties that generate higher quality fees; and leverage our strong brand equity and direct distribution channels to deliver greater value to property owners and customers.”

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Goh said Ascott also has plans to upgrade several of its strategically located properties into brand flagship assets.

Properties in the pipeline for asset enhancement initiatives include The Cavendish London and Citadines Saint-Germain-des-Prés Paris, which will be re-branded under Ascott’s premium serviced residences segment, The Crest Collection.

Shares of CLI : 9CI 0% were down by S$0.02 or 0.5 per cent at S$3.78 as at 9.51 am on Thursday, after the announcement.