CapitaLand to be Australasia's largest serviced residence provider

It recently acquired an additional 60% stake in an Aussie SR.

CapitaLand is set to be the largest serviced residence (SR) provider in the Australasia region after its SR segment, The Ascott Ltd, acquired an additional 60% stake in Quest Apartment Hotels in Australia for A$180m ($191m).

With the transaction, CapitaLand's stake in the hotel will jump to 80%. Additionally, the acquisition will boost Ascott's portfolio by over 11,000 units to more than 67,000 units.

"We understand that, since Ascott’s acquisition of a 20% stake in 2014, Quest’s network revenue has grown at an annual average rate of 6%, which has resulted in healthy annual profits from recurring fee income," OCBC Investment Research Eli Lee said.

The analyst added, "We take a favorable view on the acquisition as Ascott continues to execute on its growth plan and expands its presence worldwide, and the group remains on track to exceed its target of having 80k units in its portfolio globally by 2020."