CapitaLand Ascott Trust sells Citadines Central Shinjuku Tokyo for $222.7m

The transaction is expected to be completed by Q4 2025.

CapitaLand Ascott Trust (CLAS) plans to divest Citadines Central Shinjuku Tokyo for $222.7m (JPY25b).

The transaction is expected to be completed by the fourth quarter of 2025.

The deal, which would yield an exit EBITDA of 3.2%, is expected to bring in a post-tax gain of $50.8m (JPY5.7b) and net proceeds of approximately $187.4m (JPY21b).

CLAS will need approval from its stapled securityholders at an extraordinary general meeting scheduled for September 2025.

Assuming the net proceeds are used to repay debt, CLAS estimates a 1% increase in distribution per stapled security (DPS) for FY2024 on a pro forma basis.

The company also expects its aggregate leverage to improve to 37.8%, whilst debt headroom is expected to rise to about $2b on a pro forma basis.

“Post-divestment, Japan is expected to contribute about 16% to CLAS’ gross profit,” said Serena Teo, CEO of CapitaLand Ascott Trust Management Limited and CapitaLand Ascott Business Trust Management Pte. Ltd. (the managers of CLAS).

In the first half of 2025, Japan was one of CLAS’s strongest performing markets, with both revenue and gross profit from its Japan properties increasing 12% year-on-year (YoY).

On a same-store basis, revenue and gross profit of CLAS’s Japan portfolio increased 7% and 9% YoY, respectively.

Post-divestment, CLAS will have 29 assets in the country, comprising one serviced residence, four hotels, 23 rental housing properties, and a student accommodation property.