Frasers Hospitality Accelerates Growth Asset Recycling And Management Contracts
Frasers Hospitality, the hospitality and lodging business unit of Frasers Property, has been actively expanding its presence overseas while divesting some of its assets in Singapore. According to Frasers Hospitality’s CEO Eu Chin Fen, this is part of the company’s strategy to recycle and redeploy capital in order to support its international expansion in the coming years. Eu was appointed as the CEO in January 2023, after serving as the CEO of Frasers Hospitality Trust’s (FHT) manager since its listing in 2014.
One of the notable divestments is the sale of the 313-key Capri by Fraser, Changi City hotel to a consortium led by Hong Kong-based family office Atelier Capital Partners for $170 million in September. The hotel has since been rebranded as Dorsett Changi City Singapore, with Dorsett Hospitality International (DHI) as the operator. DHI is a subsidiary of Hong Kong-listed Far East Consortium International, which is one of the shareholders in the consortium along with Singapore-listed Heeton Holdings and Singapore family office Fortez Capital.
In March this year, FHT declined an offer from its sponsor, Frasers Property, to purchase the property, and Frasers Property subsequently sold it to a third party. According to Eu, this is part of the company’s approach to recognize and capitalize on timely opportunities to recycle capital for other projects after the end of a property’s capital cycle.
In May, Frasers Property sold another property, Fraser Residence River Promenade, to Singapore-listed Tuan Sing Holdings for $140.889 million. The serviced apartments, which consist of 72 units, were sold for $1.96 million per key. This development is part of a mixed-use project that includes Frasers Property’s Rivière, a 455-unit luxury condo that was completed last year and fully sold.
Established 26 years ago, Frasers Hospitality currently manages over 16,000 serviced apartments and hotel rooms across 20 countries. The company owns and operates six different hospitality brands, including Fraser Suites, Fraser Residence, and Fraser Place, as well as Capri by Fraser, Moderna by Fraser, and its luxury brand Malmaison, which was acquired in 2015.
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Furthermore, Novo Place at Tengah will showcase cutting-edge sustainable building methods, including advanced cooling systems, environmentally-friendly water and waste management systems, and innovative smart technologies, all aimed at improving energy efficiency. These exceptional features will also have a positive impact on the residents of Novo Place EC, reducing their utility expenses and promoting a more sustainable and eco-friendly community.
According to Eu, Frasers Hospitality is well-known for its premium serviced apartments and has a proven track record of delivering value for the assets it manages. The company is expanding its presence in existing markets and gateway cities through partnerships with established local players, with the aim of increasing its revenue contribution from management contracts. So far this year, Frasers Hospitality has announced eight new management contracts, three of which are in Shanghai.
In addition, the company is also widening its footprint in emerging markets such as Indonesia, Cambodia, Vietnam, Malaysia, and the Middle East. In February, Frasers Hospitality opened its third property in Bahrain, the 63-key Fraser Suites Al Liwan Bahrain, which is part of a mixed-use development by Bahrain-based real estate developer Seef Properties.
Furthermore, in 2027, Frasers Hospitality will launch its first premium serviced apartment in Taipei, Taiwan, in partnership with Taiwanese developer Hung Tai Group. The company has also recently entered into partnerships with US real estate group Tishman Speyer and Asian real estate investment firm Alyssa Partners in China and Japan, respectively. These deals have given Frasers Hospitality a portfolio of 449 rental housing units in Asia’s two largest economies.
In conclusion, Frasers Hospitality is optimistic about the long-stay accommodation segment and has plans to open 20 new properties in the next four years. According to Eu, the company is also rethinking its brand proposition and aims to offer unique experiences beyond traditional hospitality services to cater to the changing needs of today’s travelers.