The Ascott Limited, the lodging business unit of CapitaLand Investment, has set an ambitious target to double its fee revenue to over $500 million from its FY2022 base of $258 million in the next five years. This is its highest recorded earnings yet, bolstered by 36% year-on-year growth in FY 2022, a result of record-breaking property openings and signings.
The company has achieved its goal of securing 160,000 units by 2023. In 1QFY 2023, it signed up to 4,000 additional ones.
Ascott will continue to expand its portfolio offerings, ranging from serviced residence, hotel, co-living as well as senior living brand and positioning, while aiming for an annual net room growth rate of 8%-10% within the next five years. These plans, coupled with the company’s asset-light strategy, will lead to strengthening fee growth and drive the company to the fore.
According to Kevin Goh, CEO of CLI Lodging and Ascott, the company was able to double its units every five years, bringing the total to 160,000 by this year. Over 80% of the units are now under management and franchise contracts, up from 43% in 2008.
“With these management and franchise contracts, we want to achieve our new growth target and secure more prime properties that generate higher quality fees. Leveraging our brand equity and direct distribution channels will help us to deliver greater value to our property owners and customers.” Goh adds.
Oakwood Hotel & Apartments Taman Mini Jakarta, Indonesia (Photo: Ascott Ltd)
To reach its target, the company will focus on driving stronger fee growth in the next five years, with Citadines Connect City Centre hotel opening on Orchard Road, and two properties acquired in China and the Netherlands for $190 mil through its serviced residence global fund, Ascott also launching its third co-living property in Singapore.
It is clear that Ascott is in the right direction in fulfilling its goals, and will continue to strengthen its financial and customer portfolios in the coming years.