CAPITALAND'S service residence arm, The Ascott Limited, is looking to doubling the number of operating apartments it has in Vietnam in the next three years for some US$100 million.
Ascott could also be spinning off a property in the country to Ascott Residence Trust (ART) in the near future.
Ascott managing director (South-east Asia & Australia) Alfred Ong shared these possible developments with the press on Sunday.
According to him, Ascott has about 900 operating apartments in Vietnam. As the country attracts more foreign companies, there will be strong demand for serviced apartments for workers.
Ascott hopes to have some 1,800 operating units under its belt in another three years, and the amount of capital required could come up to around US$100 million. Mr Ong said that the growth could come from property acquisitions or management contracts.
Ascott has five operating properties and another three opening in the next few years. All of them fall under the Somerset brand - targeted at expatriate families - and are in the cities of Ho Chi Minh, Hanoi, Danang and Hai Phong.
Mr Ong revealed plans to bring two other brands - Citadines and Ascott - to Vietnam. 'We are now looking for opportunities and sites in certain locations,' he said.
Citadines properties would be suitable for singles who are in the country for projects, Mr Ong said.
Meanwhile, travellers looking for premium services might be interested in the Ascott brand of properties.
He added that the Ascott firm is eyeing expansion to two other cities - the oil exploration area of Vung Tau and agricultural centre Can Tho.
Of the five operating Somerset properties in Vietnam today, four are already in ART's portfolio. Mr Ong said that Ascott will consider selling the remaining one - Somerset Hoa Binh in Hanoi - to ART when the 'time is right'.
The total investment in Somerset Hoa Binh was close to US$30 million, and Ascott owns a 90 per cent stake in the property.
Ascott soft-opened the property in late 2008 and Mr Ong said that a service residence's incubation period usually lasts one to one-and-a-half years.
Source: Business Times, 8 Jun 2010