Within the next five years, Ascott hopes to treble fee revenue to more than $500 million - Novo Place EC at Tengah Plantation Close By Qingjian & Santarli (Hot Launch 2023)

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CapitaLand’s (CLI) hotel business segment, The Ascott Limited, has set a goal to double its fee revenues to $500 million over the coming five years. The goal is based on Ascott’s FY2022 baseline that was $258m, which is the most profitable year to date. In FY2022, the company’s profits increased by 36% on a yearly basis due to highest-ever signings, as well as property openings.

The company also revealed that it had met its goal of acquiring 160,000 units in 2023. The company has signed more than 4,000 new units during the 1QFY2023.

In the statement, Ascott says it will continue to increase its offerings of products that include hotels, serviced residences co-living, senior living, and hotel brands, and is positioned in the mid- to high-end scale. Ascott’s growth in fee revenue is due to new property openings and new sign-ups, which is expected to result in an annual rate of growth in net rooms between 8% and 10% over the five years to come.

“With our asset-light approach, Ascott has doubled in units every five years, increasing from around 22,000 units at the time of 2008 up to more than 160,000 units in the present. We are seeing the financial benefits from growing our portfolio eightfold. We will now focus on accelerating fees over the course of five years. More than the 80% of our units are managed and franchise agreements, up from 43% 10 years ago. The franchise and management agreements typically come with recurring fees revenues and lengthy tenures,” says Kevin Goh the CEO of Ascott as well as CLI Lodging.

“To reach our new expansion plan, we’ll obtain more franchise and management agreements for top properties which will result in higher-quality fees. We will also make use of our brand’s strong equity and the direct distribution channel to offer more worth for property owners and clients,” he adds.