Global real asset manager CapitaLand Investment Limited (CLI) announced that it has achieved final close for its value-add lodging private fund CapitaLand Ascott Residence Asia Fund II (CLARA II).
The company secured over US$650 million in total equity commitments and co-investments across the fund and associated vehicles.
This is above the fund’s US$600 million equity target and underscores continued investor confidence in the living and lodging sector as well as CLI’s investment and operational expertise in Asia Pacific.
According to CLI group chief operating officer Andrew Lim: “The successful close of CLARA II reflects investors’ confidence in CLI’s deep investment expertise and active asset management capabilities to execute a disciplined value-add strategy in the fast-growing lodging and living sector. We are seeing increasing investor allocations into the sector attracted by their long-term growth potential. This is underpinned by trends such as rising mobility, the surge in ‘bleisure’ travel and demand for flexible living arrangements. Building on CLI’s investment experience in the living and lodging sector, we are well-positioned to develop and execute more targeted fund strategies, capitalising on high-potential opportunities in the market.”
CLI managing director for lodging private equity funds Mak Hoe Kit added: “The strong support we have received from CLI’s international network of capital partners demonstrates investors’ trust in our capabilities and lodging fund strategy. Our competitive edge in seeing through the full life cycle of our assets is key to CLARA II’s value-add strategy. Through our first lodging private fund, we have demonstrated our proven track record of successful value-add and exits. The team remains disciplined in its project management and execution, adding significant value to the properties through reconfiguration and renovation, and swiftly bringing them to market. Returns on divestment for our previous assets such as lyf Ginza Tokyo and lyf Funan Singapore were above the fund’s target, generating alpha for our capital partners. We continue to tap on our deep investment and asset management expertise and network to identify and execute opportunities to deliver long-term returns for our stakeholders.”
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It is expected that CLARA II will add approximately US$1.6 billion to CLI’s total funds under management. Global investors in the fund include new and repeat capital partners, comprising a diverse pool of institutional investors, pension funds and financial institutions from Asia, Europe and North America.
Indeed, CLI has committed a 20 percent sponsor stake to ensure strong alignment.
CLARA II targets opportunities in the living and lodging sector across gateway cities in Asia Pacific, focusing on unlocking value by transforming underutilised assets into high-performing living and lodging properties.
It likewise leverages the expertise of best-in-class operators in the sector, including CLI’s lodging business unit The Ascott Limited, to enhance asset performance.
As of press time, the fund has already deployed approximately half of its committed equity across three assets.
At present, CLARA II’s portfolio comprises a serviced residence and a coliving property in Japan, as well as a coliving property in Singapore.
