CapitaLand Ascott Trust Posts 6% H1 Profit Jump as Distribution Holds Steady

CapitaLand Ascott Trust on Tuesday posted a 6 percent year-on-year jump in first-half gross profit to S$182.5 million ($141.8 million) as the managers credited stronger operating performance, portfolio reconstitution and asset enhancement initiatives at Asia Pacific’s biggest lodging REIT.

CLAS’s revenue for the six months to the end of June rose 3 percent year-on-year to S$398.5 million, the Singapore-listed trust’s managers said in a release. Total distribution held steady at S$96.5 million.

Stable income sources contributed 66 percent of CLAS’s gross profit during the half — including 16 percent from rental housing and student accommodation properties — while growth income sources accounted for the remaining 34 percent, according to the managers, which are owned by Temasek-controlled CapitaLand Investment.

“We continue to seek opportunities to reconstitute and enhance our portfolio,” said Lui Chong Chee, chairman of the managers. “By divesting properties at the optimal stage of their life cycle, we are able to reinvest the proceeds into higher-yielding acquisitions, AEIs or other value-accretive uses to deliver stable and sustainable returns to stapled securityholders.”

Portfolio Overhaul

CLAS reported a market capitalisation of S$3.4 billion and total assets of S$8.8 billion at the end of the first half. The 101-property trust holds much of its portfolio in serviced apartments under CapitaLand’s Ascott, Somerset, Quest, Citadines and Lyf brands.

The REIT reworked the portfolio in 2024 with the acquisitions of Teriha Ocean Stage, a rental housing property in Japan’s Fukuoka; Standard at Columbia, a South Carolina student housing asset; and Lyf Funan Singapore, a hotel in the city-state’s downtown; as well as disposals including Citadines Mount Sophia in the Bugis area and three Osaka hotels.

The moves have continued this year with the purchase of two Japan hotels, Ibis Styles Tokyo Ginza in the capital’s retail and entertainment hub and Chisun Budget Kanazawa Ekimae on Honshu island’s western coast.

“We continue to strengthen the quality and earnings resilience of CLAS’s portfolio, positioning us for future growth,” said Serena Teo, CEO of the trust’s managers.

Asset Enhancements Ahead

CLAS completed six asset enhancement initiatives in 2024 and plans to undertake three additional AEIs this year and next, on top of previously announced improvement schemes for The Cavendish London and the Sydney Central Hotel.

The three additional properties are Ibis Ambassador Seoul Insadong in South Korea, Citadines Republique Paris and Sotetsu Grand Fresa Osaka-Namba. The AEI for Ibis Ambassador Seoul Insadong began in early 2025 and was completed in the second quarter, the managers said.

Total capital expenditure for the four remaining AEIs is S$205 million, of which CLAS’s investment is S$145 million, with the rest funded by the master lessee or operator of the properties.

CLAS is also redeveloping its 192-unit Somerset serviced residence at Singapore’s Clarke Quay. Development work is scheduled for completion in 2026, with the property to commence operations in 2027.