Pursuing Growth | 07
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While expansion has been in the limelight,
Ascott Reit has continued to deliver another
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Total revenue for the year reached S$357.2 million
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a year-on-year growth of 13% and 12% respectively.
The stronger performance was largely underpinned
by the yield accretive acquisitions during the year,
as well as stronger operating performance from
existing properties. The average occupancy of the
Group’s portfolio for FY 2014 has remained stable at
around 80%.
The Group’s distribution to Unitholders for FY 2014
grew by 9% year-on-year to reach a record high
of S$125.6 million. Distribution per Unit (DPU) for
FY 2014 was 8.20 cents, representing an attractive
yield of 6.5% based on the closing price of S$1.27
on 31 December 2014. Ascott Reit’s distribution
to Unitholders for the period from initial listing to
FY 2014 has achieved a respectable compound
annual growth rate of 22.6%.
As at 31 December 2014, Ascott Reit’s investment
properties were valued at S$3,811.4 million by
independent valuers, an increase of 16.8% from
the previous valuation as at 31 December 2013,
attributed by the acquisitions in 2014 and higher
valuation from properties in China, United Kingdom,
Belgium and Japan.
Ascott Reit continues to deliver stable income to its
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portfolio across Europe and the Pan-Asian regions,
coupled with its extended-stay business model.
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FY 2014 was contributed by master leases and
serviced residence management contracts that
provide a minimum guaranteed income.
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The Group continues to drive organic operational
growth by putting its existing portfolio through
robust asset enhancement programmes to optimise
returns for the Unitholders and to meet increasingly
sophisticated demands of modern travellers.
As at 31 December 2014, approximately 80% of
Ascott Reit’s serviced residence properties have
undergone, or are undergoing, Asset Enhancement
Initiatives (AEI), with the remaining 20% of the
portfolio projected to undergo AEI by 2016. A rolling
plan has been developed to oversee this aspect of
the management.
In 2014, approximately S$20.7 million was spent
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Europe. These AEI have yielded both positive
feedback and higher returns. Completion of the
AEI at Citadines Ramblas Barcelona and Citadines
Toison d’Or Brussels in 2014 have brought about an
uplift of close to 20% in Average Daily Rate (ADR).
Somerset Grand Central Dalian, Somerset Olympic
Tower Property Tianjin and Somerset Ho Chi Minh
City are currently undergoing refurbishment which is
on track to be completed in 2015 while the ongoing
AEI at Somerset Xu Hui Shanghai is expected to be
completed in 2016.
Our properties, together with our improvement
in service delivery, have made us the preferred
accommodation for business and leisure travellers
alike. Hailed as “The Oscars of the Travel Industry”,
at the World Travel Awards 2014, we clinched
the titles of “Leading Serviced Apartments” for
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Singapore, Citadines Sainte-Catherine Brussels,
and Citadines Arnulfpark Munich. In addition,
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property located in the heart of Singapore’s Central
Business District, has also clinched the prestigious
title as the “World’s Leading Serviced Apartment”.
The same property also won the “Best Serviced
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The Group’s disciplined approach towards capital
and risk management continues to strengthen its
strong balance sheet. As at 31 December 2014,
Ascott Reit’s gearing of 38.5% was well below the
Monetary Authority of Singapore’s (MAS) Property
Fund Appendix’s gearing limit of 60.0%. In 2014,
our interest cover ratio remained healthy at 4.3 times
and average borrowing cost was a low 3.0% per
annum with a substantial 80% of the total borrowings
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As part of the Group’s prudent and disciplined
approach towards capital management, the Group
seeks to diversify funding sources and secures
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2014, Ascott Reit tapped the debt capital market
by issuing a six-year JPY7.0 billion (approximately
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successfully issued a ten-year Euro-denominated
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S$129.6 million) at 2.75% per annum. Both these
