Serviced ApartmentsBoth properties in these two cities were divested above valuation as part of an active portfolio reconstitution strategy.

Ascott sells serviced residences in Guangzhou, Paris

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Beh: Divestments spell opportunity for Ascott Residence Trust to rejuvenate its portfolio.
Beh: Divestments spell opportunity for Ascott Residence Trust to rejuvenate its portfolio.

Ascott Residence Trust (ART) is selling two properties, Ascott Guangzhou in China and Citadines Didot Montparnasse Paris in France, for a total of approximately S$191.4 million (US$138.8 million).

Upon completion of both transactions, ART is expected to realise total estimated net gains of about S$23.2 million.

Commenting on the transaction, CEO of the managers of ART, Beh Siew Kim, said: "Despite the Covid-19 situation, the opportunistic sale of Ascott Guangzhou and Citadines Didot Montparnasse Paris at an attractive price allows ART to rejuvenate its portfolio and unlock the strong underlying value of these properties.”

Acquired in 2012 for RMB431 million (US$62 million), Ascott Guangzhou will be divested at RMB780 million, which is 52% higher than the property's book value and 81% of its acquisition price. Estimated net gains upon completion of the transaction in Q1 2021 is about S$19.4 million.

For Citadines Didot Montparnasse Paris, one of 28 properties ART acquired from The Ascott in 2010, the divestment price of EUR23.6 million (US$27.6 million) is about 69% above the property’s book value and about 60.4% higher than the acquisition price. ART is expected to realise estimated net gains of about S$3.8 million upon completion of the transaction in end-2020.

Beh added: “During these uncertain times, we will continue to be prudent in managing our capital and cash flow, as well as ensure that ART remains resilient with its geographically diversified portfolio focused on the long-stay segment.”

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