Ascott REIT acquires Sydney limited-service business hotel for $59 mil

SINGAPORE (Mar 27): Ascott Residence Trust (Ascott REIT) is acquiring Felix Hotel, a prime freehold limited-service business hotel near Sydney Airport for A$60.6 million ($58.8 million).

Completed and opened in February 2018, the 150-room property will be rebranded as Citadines Connect Sydney Airport upon completion of the acquisition in May.

This will be Ascott REIT’s first business hotel in Australia and its first property to be managed by its sponsor, The Ascott Limited (Ascott) under the new Citadines Connect brand.

The acquisition will add to Ascott REIT’s portfolio in Australia to over 900 units across six properties. Ascott REIT currently owns three properties in Sydney – Quest Mascot, Quest Campbelltown and Quest Sydney Olympic Park, in addition to Citadines St Georges Terrace Perth and Citadines on Bourke Melbourne.

The accretive acquisition, with an EBITDA yield of over 6%, will be funded by bank loans, divestment proceeds or a combination of both.

Beh Siew Kim, Ascott REIT’s Chief Executive Officer, says: “The target business hotel is adjacent to another property owned by Ascott Reit – the 91-unit Quest Mascot which has been enjoying over 85% occupancy.”

As at 1.12pm, units in Ascott REIT are trading 1 cent lower at $1.17.

 

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