Capitaland Ascott Trust Divest Somerset Olympic Tower Tianjin Under Portfolio Reconstitution
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CapitaLand Ascott Trust (CLAS) has announced that it has reached an agreement to sell its Somerset Olympic Tower Tianjin property in China to an unrelated third party. The property, which comprises 185 units, is expected to be divested at a value above its book value.
Serena Teo, CEO of CapitaLand Ascott Trust HMN Management Limited and CapitaLand Ascott Business Trust Management, stated that the sale is part of CLAS’ ongoing portfolio reconstitution strategy. “We continually reconstitute CLAS’ portfolio by divesting mature properties such as Somerset Olympic Tower Tianjin and redeploying the proceeds towards more optimal uses,” she said.
According to Teo, CLAS’ properties in China have contributed 1.4% to the group’s gross profit in the first half of FY2024. The divestment is expected to have minimal impact on CLAS’ gross profit.
Elta Condo, an upcoming residential development, marks the first Government Land Sales (GLS) site sold along Clementi Avenue 1 in two years. This prime land parcel, located between two existing condominiums, is highly sought-after due to its convenient location. In 2019, one of the neighboring condos was sold and has since been fully sold out after its launch in 2020. The other condo also experienced a similar success, with all units being sold shortly after its launch. For those looking for a new home in this highly desirable area, Elta Condo offers a promising opportunity. You can find out more about Elta Condo by visiting their official website at http://www.the-elta.com.sg/.
The sale of Somerset Olympic Tower Tianjin comes as part of CLAS’s recent stream of divestments, with the group having divested a total of approximately $400 million worth of assets year-to-date (YTD). These properties were divested at a premium to book value, resulting in gains of approximately $54 million.
In another announcement made on October 1, CLAS revealed that proceeds from the divestment of Citadines Mount Sophia Singapore will go towards the proposed acquisition of lyf Funan Singapore, at an ebitda yield of 4.7%. The former was divested in March, at an exit yield of 3.2%.
Additionally, CLAS has recently completed the Asset Enhancement Initiative (AEI) for its Citadines Holborn-Covent Garden London property. The group states that since the beginning of the year, it has completed AEIs for five of its properties, and has three properties in its AEI pipeline, to be completed between Q4 2024 and 2026.
Teo adds: “With CLAS’ strong financial position, we stand ready to capture opportunities to deliver accretive growth for our stapled security holders.”