CapitaLand Investment (CLI) has acquired a mixed-use asset in Japan at more than JPY30bn (€182m) with its co-investors in its second value-add private lodging fund, CapitaLand Ascott Residence Asia Fund II (CLARA II).
CLARA II has received fresh commitments from new and existing institutional investors to invest in the property in Tokyo, which is its third asset and second in Japan. CLI holds about 20% stake in the fund.
Kevin Goh, CEO of CLI Lodging, said: “The additional capital commitments reinforce CLI’s reputation as a trusted steward and the continued strong investor interest in serviced residences, which have proven to be a resilient asset class with the ability to deliver attractive yields.
“With CLARA II, we are focused on refurbishment and conversion to maximise the value of their assets. Amid the global uncertainties, market dislocations in the hospitality sector have also created more opportunities for value-add and repositioning.”
Mak Hoe Kit, managing director, Lodging Private Equity Funds, CLI, said: “Japan is one of Asia’s most developed and liquid real estate markets, supported by deep capital pools. Leveraging our local expertise, we secured this off-market opportunity at an attractive entry price.
“CLARA II’s earlier assets — lyf Shibuya Tokyo and lyf Bugis Singapore — have been successfully repositioned and launched. lyf Shibuya Tokyo achieved over 70% occupancy within three months of opening, demonstrating our ability to transform underutilised assets into high-performing lodging investments.”
Mak said building on the success of its first private lodging fund and the recent divestments of two assets “at premiums above target returns”, the CLI could see “a growing opportunity to bring our lodging fund strategy to Europe”.
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