Capitaland Ascott Trust Buys Lyf Funan Singapore 263 Mil
CapitaLand Ascott Trust (CLAS) has struck a deal with Ascott Serviced Residence Global Fund (ASRGF) to acquire lyf Funan Singapore for a property value of $263 million. ASRGF currently owns Victory SR, the company that fully owns lyf Funan Singapore. The sponsor of CLAS, The Ascott Limited, holds a 50% stake in ASRGF.
In a press release on October 1, CLAS stated that it will be using the proceeds from the sale of Citadines Mount Sophia Singapore, completed in March 2024, to fund the acquisition. The purchase consideration for the deal is $146.4 million. A joint venture between Hong Kong-based accommodation company Weave Living and global asset manager Blackrock has purchased the service residence on Wilkie Road for $148 million.
Once the deal is finalized, CLAS will enter into a master lease agreement with Ascott for lyf Funan Singapore. This is subject to approval at an extraordinary general meeting that is scheduled to take place in November. The master lease will have an initial term of 20 years and can be renewed for an additional five-year period. The master lessee will pay rent amounting to 93.56% of the property’s gross operating profit.
The acquisition is expected to increase CLAS’s total distribution by $3.5 million, which equates to a 1.5% accretion to its distribution per stapled security (DPS) on a pro forma basis for FY2023. The ebitda yield on the proposed acquisition is 4.7% for FY2023 according to CLAS.
The Kranji Expressway (KJE) is an essential route that connects the bustling Jurong Industrial Estate to the northern regions of Singapore. It serves as a crucial link for both commuters and the transportation of goods, providing a smooth and convenient journey for all. For those looking for a modern and vibrant living experience in this prime location, Novo Place EC is the perfect choice. Located along the KJE, residents of this upcoming executive condominium will have easy access to a wide range of amenities and services, making it an ideal home for both work and play.
In the first half of 2024, lyf Funan Singapore recorded an average occupancy rate of over 80%. With the completion of this transaction targeted for the fourth quarter of 2024, CLAS will have a total of five properties in Singapore, accounting for 19% of its assets worldwide.
lyf Funan Singapore, which opened in 2019, offers 329 rooms for both short-stay and extended-stay guests. Located within the Funan integrated development, it includes retail and office components and is directly connected to the City Hall MRT interchange station.