Expansion into long-stay lodging segment is part of Frasers Hospitality’s transformation and growth strategy
SINGAPORE, May 23, 2023 /PRNewswire/ — Frasers Hospitality, a strategic business unit of Frasers Property, is pleased to announce the formation of two joint ventures with established real estate players, Tishman Speyer and Alyssa Partners, in China and Japan, respectively. As part of these joint ventures, Frasers Hospitality has entered into two sale and purchase agreements to acquire its inaugural premium rental apartment assets in Shenzhen, China and Osaka, Japan with a combined asset value of approximately S$170 million.
Tapping into North Asia’s burgeoning long-stay segment
The long-stay lodging segment in key locations across North Asia, particularly in Japan and China, has demonstrated resilience and tremendous growth potential over the past decade, driven by robust demand supported by a combination of demographic, economic and social factors driven by rapid urban migration. Housing affordability has also increasingly become a pressing issue in the aftermath of the COVID-19 pandemic which led to stronger demand for rental apartments. The premium rental apartment assets will complement Frasers Hospitality’s existing portfolio and deepen its presence in North Asia. With these timely acquisitions, Frasers Hospitality will be better placed to capture opportunities from the long-stay segment.
The 325-unit premium rental apartment in Shenzhen, China, is a leasehold asset jointly acquired with Tishman Speyer. Situated in the heart of the Luohu commercial and shopping district and within walking distance of the nearest train station, the property is well-positioned to benefit from Luohu’s strategic location as a key transportation hub between Shenzhen and Hong Kong as well as the district’s future growth potential with the launch of Luohu’s urban renewal plans in the next decade. The property, which will be managed and branded under Frasers Hospitality, forms part of a mixed-use development project that topped off last year and is slated to open in the fourth quarter of 2024, significantly reducing its time to market.
The 124-unit premium rental apartment in Osaka, Japan, is a freehold asset acquired through a joint venture with Alyssa Partners. It is situated in the Namba precinct, a major commercial district in Osaka, and is within walking distance of the nearest subway station. The property is currently operational and at close to full occupancy. Osaka has been undergoing revitalisation in the lead-up to World Expo 2025 and the city has recently approved the development of Japan’s first integrated resort. These developments bode well for the growth potential and continued attractiveness of Osaka and the property is set to continue benefitting from the rising demand in the long-stay segment.
Expanding the portfolio with quality long-stay lodging assets
The acquisitions are in line with Frasers Hospitality’s post-pandemic transformation and expansion strategy to evolve into an international lodging real estate player and strengthen its position and growth as an investor of choice in the long-stay lodging segment. It also serves as a catalyst for Frasers Hospitality to deepen its presence and widen its reach within the long-stay lodging segment in key gateway locations.
Commenting on the joint ventures and acquisitions, Ms Eu Chin Fen, Chief Executive Officer of Frasers Hospitality said, “Long-stay lodging assets have become increasingly resilient and attractive as an asset class. We look forward to mutually beneficial long-term partnerships with our established joint venture partners, who have chosen to join hands with Frasers Hospitality to leverage our seamless, integrated investment model and long-standing operational expertise to add value to their investments. These acquisitions attest to our local teams’ extensive business networks and strong deal expertise to source for attractive, scalable investment opportunities. We continue to seek compelling opportunities to further expand in the long-stay lodging segment with the aim of delivering quality and sustainable returns.”
Riding on travel rebound wave as China reopens
The pair of acquisitions adds to Frasers Hospitality’s expanding portfolio in North Asia with close to 3,400 units in 16 properties across China, Japan and South Korea. Following the recent signing of a management agreement in Chengdu, China, under the Modena brand, there will also be a total of 11 properties in multiple cities across North Asia slated to open over the next three years. The launch of these properties comes at an opportune time as Frasers Hospitality continues to ride on the travel recovery trajectory in the post-pandemic landscape.
Mr Mark Chan, Chief Operating Officer of Frasers Hospitality said, “North Asia is an important market to Frasers Hospitality and we are excited about the expansion momentum in this region. Growth in other regions is also gathering pace with new properties soon to open in Singapore and Cambodia, and we look forward to sharing more news of our developments as our strong pipeline benefits from normalisation in the travel and lodging industry.”
About Frasers Hospitality
Frasers Hospitality, a strategic business unit of Frasers Property, celebrates 25 years of offering memorable experiences to guests with its Gold-Standard serviced and hotel residences across Asia, Australia, Europe, the Middle East and Africa.
Growing from two properties in Singapore to more than 120 properties in over 70 cities, Frasers Hospitality is now one of the world’s largest and fastest-growing providers of serviced and hotel residences and investors in the long-stay lodging segment. Conceived with the lifestyle preferences of today’s discerning business and leisure travellers in mind, the global hospitality operator has three Gold-Standard serviced residence offerings – Fraser Suites, Fraser Residence and Fraser Place, a modern and eco-lifestyle brand, Modena by Fraser, and a design-led hotel residence brand, Capri by Fraser.
With a remarkable list of accolades and awards as recognition of its success, Frasers Hospitality remains committed to anticipating and exceeding the evolving needs of executive travellers with continuous innovation and intuitive service, creating a second home for guests where staff feel like family and residents feel like a community.
For more information on Frasers Hospitality, please visit www.frasershospitality.com.
About Frasers Property Limited
Frasers Property Limited (“Frasers Property” and together with its subsidiaries, the “Frasers Property Group” or the “Group“), is a multinational investor-developer-manager of real estate products and services across the property value chain. Listed on the Main Board of the Singapore Exchange Securities Trading Limited (“SGX-ST“) and headquartered in Singapore, the Group has total assets of approximately S$40.1 billion as at 31 March 2023.
Frasers Property’s multinational businesses operate across five asset classes, namely, residential, retail, commercial & business parks, industrial & logistics as well as hospitality. The Group has businesses in Southeast Asia, Australia, Europe and China, and its well-established hospitality business owns and/or operates serviced apartments and hotels in over 20 countries and more than 70 cities across Asia, Australia, Europe, the Middle East and Africa.
Frasers Property is also the sponsor of two real estate investment trusts (“REITs“) and one stapled trust listed on the SGX-ST. Frasers Centrepoint Trust and Frasers Logistics & Commercial Trust are focused on retail, and industrial & commercial properties, respectively. Frasers Hospitality Trust (comprising Frasers Hospitality Real Estate Investment Trust and Frasers Hospitality Business Trust) is a stapled trust focused on hospitality properties. In addition, the Group has two REITs listed on the Stock Exchange of Thailand. Frasers Property (Thailand) Public Company Limited is the sponsor of Frasers Property Thailand Industrial Freehold & Leasehold REIT, which is focused on industrial & logistics properties in Thailand, and Golden Ventures Leasehold Real Estate Investment Trust, which is focused on commercial properties.
As a purpose-led organisation, the Group is committed to inspiring experiences and creating places for good for its stakeholders. By acting progressively, producing and consuming responsibly, and focusing on its people, Frasers Property aspires to raise sustainability ideals across its value chain, and build a more resilient business. It is committed to be a net-zero carbon corporation by 2050. Building on its heritage as well as leveraging its knowledge and capabilities, the Group aims to create lasting shared value for its people, the businesses and communities it serves. Frasers Property believes in the diversity of its people and is invested in promoting a progressive, collaborative and respectful culture.