CapitaLand Ascott Trust (CLAS) has acquired two hotels in Japan for roughly SG$178.5 million, enhancing its asset portfolio in the region. The two properties, ibis Styles Tokyo Ginza and Chisun Budget Kanazawa Ekimae, are strategically located to cater to increasing travel demand.

According to a pro forma analysis for FY 2024, the acquisition is projected to contribute a Distribution per Stapled Security (DPS) increase of 1.6%, with a blended net operating income (NOI) yield of 4.3%. Funding was secured through JPY-denominated debt, coupled with proceeds from previous property sales in Japan.

Serena Teo emphasizes the significance of this acquisition: “Japan is a key market for us. After this acquisition, 18% of CLAS’s assets will be in Japan, addressing the sustained high demand for international travel in this region, with Tokyo and Kanazawa’s visitation rates having increased by 23% and 12% compared to pre-COVID figures, respectively.”

The revenue potential for both properties is expected to grow, aided by management contracts that facilitate income upside as part of CLAS’s portfolio strategy.