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Ascott Residence Trust
Annual Report 2015
Overview
Sustainability
Business
Review
Portfolio
Details
Corporate
Governance &
Transparency
Financials &
Additional
Information
2015 Review
According to EIU, Australia’s economy recorded a
GDP growth of 2.3% in 2015. The hospitality and
tourism sectors saw sustained and strong growth in
both international and domestic arrivals. According to
Tourism Research Australia, there were 7.4 million visitor
arrivals to Australia for the year ended December 2015,
an increase of 8.2% over 2014. In addition, international
visitors to Australia spent a record A$36.6 billion in the
year ending December 2015, an increase of 17.7% or
A$5.5 billion more than the previous year. On the back
of a stable economy coupled with strong demand in the
hospitality sector, Ascott Reit seized the opportunity to
scale up its presence in Australia through the successful
acquisition of Citadines on Bourke Melbourne in
July 2015.
Overall RevPAU decreased by 9% YoY from S$172
in 2014 to S$156 in 2015 mainly due to the newly
acquired Citadines on Bourke Melbourne which
has a lower ADR as compared to that of Citadines
St Georges Terrace Perth. Despite the slowdown in
demand from oil and mining industries which affected
the hospitality market in Perth, Citadines St Georges
Terrace Perth outperformed the market with a high
occupancy of 88% for FY 2015.
2016 Outlook
According to EIU, Australia’s GDP is expected to
grow 2.6% in 2016. The Organisation for Economic
Co-operation and Development (OECD) predicted
that the economy is on track to recover to 3% by
2017. Ongoing decline in resource-sector investment
will be offset by strengthening consumption, non-
resource sector investment and exports. Consumer
price inflation will increase gradually as the economic
upswing gathers momentum and the labour market
starts tightening.
In Perth, market conditions are expected to improve in
2016 as the economy diversifies away from the natural
resource industries into sectors that offer further
growth, namely agriculture, tourism and international
education. Despite the new supply of hotels over the
next two years, majority of the committed pipeline
belongs to the luxury segment while new supply in
the mid-scale category remains limited. In Sydney
and Melbourne, the outlook for the hospitality sector
remains positive, underpinned by strong corporate
and leisure demand from rising inbound visitors.
Significant new infrastructure will enhance the
attractiveness of the location, while limited new supply
will likely improve occupancy rates at our properties.
We expect the properties in Australia to enjoy stable
and healthy operational performance in 2016.
1
The property was acquired on 31 July 2015.
2
The property was acquired on 10 December 2014.
Gross Rental Income
(S$’000)
Agreed
Property Value
at Acquisition
(S$’million)
FY 2015 FY 2014
Citadines on Bourke Melbourne
1
9,105
–
167.6
Citadines St Georges Terrace Perth
5,177
5,483
36.1
Quest Campbelltown
2
1,655
104
21.3
Quest Mascot
2
2,144
134
26.9
Quest Sydney Olympic Park
2
3,337
202
44.8
Revenue Per Available Unit (S$)
FY 2015
FY 2014
Citadines on Bourke Melbourne
1
153
–
Citadines St Georges Terrace Perth
163
172
