BT: Ascott to buy Wilkie Road serviced apts for $79m - 30 Aug 07

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August 30, 2007
Ascott to buy Wilkie Road serviced apts for $79m
Property to take on Citadines brand, will open in 2009
By CHEN HUI FEN

THE Ascott Group has agreed to buy a 99-year leasehold serviced
residence in town for $79.3 million, the company announced
yesterday.

The property, located at Wilkie Road, is part of lifestyle complex
Wilkie Edge, which is under construction. Wilkie Edge is a mixed
development consisting of offices, retail, and food and beverage
outlets.

The acquisition, to be funded from internal resources and external
borrowings, will bring Ascott's property portfolio in Singapore to
11, with a combined 1,042 units. It will be named Citadines
Singapore Mount Sophia and open in the first half of 2009.

'Citadines Singapore Mount Sophia is strategically located in the
heart of Singapore's upcoming arts, learning and entertainment hub
in the Bras Basah-Bugis area,' said Ascott president and CEO Jennie
Chua. 'It is in the city centre with excellent access to the central
business district and the shopping and entertainment attractions of
Orchard Road.'

The Ascott Group had earlier inked a memorandum of understanding to
manage Wilkie Edge's serviced residences for an initial 10-year term
with an option to extend it for another 10 years.

'Strong demand for extended-stay accommodation, the vibrant real
estate market, and the property's attractive location are reasons
for Ascott to acquire leasehold interests in the serviced residence
instead of only managing the property for fee income,' added Ms
Chua. 'This will enable us to maximise shareholder returns.'

The new property will have 154 units and be Ascott's first Citadines-
branded serviced residence in Singapore. It will cater to the young
and trendy, expatriates working in the creative services community
as well as foreign students and academics from the nearby Singapore
Management University, Nanyang Academy of Fine Arts and LaSalle
College of The Arts.

The acquisition agreement is inked between Ascott's indirect wholly
owned subsidiary Ascott Scotts Pte Ltd, CapitaLand Selegie Pte Ltd
and HSBC Institutional Trust Services, which is the trustee of
CapitaCommercial Trust (CCT).

Just last month, CCT had announced that it is buying Wilkie Edge for
$262 million. The pact comes with an option to lease the serviced
apartments for a $79.3 million consideration. When this option is
exercised, CCT's purchase price for Wilkie Edge will be reduced to
$182.7 million.