CapitaLand’s wholly owned serviced residence business unit, The Ascott Limited, is acquiring its first serviced residence in Docklands, Melbourne through a 50:50 joint venture between Ascott and Qatar Investment Authority (QIA).
The A$71 million ($54.1 million) deal is part of its A$500 million strategic partnership with Quest Apartment Hotels, one of the largest serviced apartment operators in Australia.
Quest will lease the 221-unit serviced residence, which will be named Quest NewQuay Docklands, and operate it under Quest’s franchise when the property opens in 2019. Quest NewQuay Docklands will be Quest’s largest property in its network.
Ascott’s serviced residence global fund was set up through a joint venture with QIA in July 2015 with each contributing $300 million of equity funds to the joint venture.
The fund invests in serviced residences and rental housing properties with an initial focus on Asia Pacific and Europe. Ascott’s four acquisitions made in partnership with QIA have a total investment amount of $270 million and would be funded partly by debt.
Lee Chee Koon, Ascott’s CEO, said: “Forging strategic alliances globally with partners such as Quest and QIA, as well as industry leaders from land owners to property developers, construction firms, online platforms and tech companies; enables Ascott to deepen our presence and build scale in key cities.”
Through the Ascott-Quest alliance formed in late-2014, Ascott will invest up to A$500 million in new properties that Quest will secure for its franchise in Australia until 2019.
Paul Constantinou, chairman of Quest Apartment Hotels, said: “Demand for accommodation in Australia from both international and domestic corporate customers remains strong but the supply of new accommodation has been lacking.
"Ascott’s investment will not only enable us to accelerate Quest’s growth to cater to the demand in Australia, our tie-up with Ascott also provides a solid platform for us to take the Quest brand overseas.”
In Australia, Ascott currently manages five serviced residences with more than 670 apartment units in Melbourne, Perth and Hobart under the Citadines and Somerset brands. Quest has more than 150 properties with over 8,000 existing units in Australia, New Zealand and Fiji, and a further 1,500 units under construction.For all the latest travel news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.