32 CapitaLand Ascott Trust Operations Review Operational Updates In 2025, Japan’s inbound tourism market reached new heights, with international visitor arrivals surpassing 42 million, an increase of 15.8 % from 2024 and marking the highest annual total on record. The robust growth was supported by the continued appeal of Japan’s cultural attractions, competitive pricing due to a weak Yen, and strong demand from Europe, the USA and Australia. Based on preliminary data, travel expenditure by inbound visitors climbed to about JPY9.5 trillion, setting a third consecutive annual record for tourism receipts2. Against this backdrop, the Japan hotel sector sustained its positive momentum in 2025. On a same-store basis, excluding ibis Styles Tokyo Ginza and Chisun Budget Kanazawa Ekimae acquired in January 2025, and Citadines Central Shinjuku Tokyo, divested in October 2025, CLAS’ RevPAU increased by 14% YoY in JPY terms3, primarily driven by higher occupancy rates. In November 2025, the Chinese government issued an advisory discouraging outbound travel to Japan. Despite this, the impact on CLAS’ FY 2025 performance was limited, as CLAS’ properties in Tokyo and Kanazawa have a diversified guest profile, with Chinese travellers accounting for less than 10% of guests. Revenue from CLAS’ properties under master leases increased 11% YoY in JPY terms in FY 2025. The two hotels delivered strong operating performance, boosted by the Expo 2025 in Osaka, while the student accommodation property continued to deliver stable income under its fixed-rent master lease. The master lease for Sotetsu Grand Fresa Osaka-Namba was renewed in 2025 for a new 11-year term beginning January 2026, with rent terms largely unchanged. The property is undergoing AEI from 4Q 2025 to 4Q 2026. Revenue from CLAS’ rental housing properties declined YoY mainly due to the divestment of Infini Garden in October 2024, partially mitigated by the three properties acquired in August 2025. On a same-store basis, revenue was stable and the properties continued to register high average occupancies of over 95%. Looking ahead to 2026, Japan's inbound travel demand is anticipated to remain robust, though slightly below the 2025 peak as arrivals from China and Hong Kong could soften2. Approximately 41.4 million foreign visitors are forecasted, and hospitality demand is expected to remain healthy, supported by events like the World Baseball Classic, and new attractions such as the Pokémonthemed amusement park PokéPark Kanto in Tokyo. To address potential shortfalls from China, CLAS properties are targeting alternative source markets, while CLAS’ living sector properties are expected to continue providing diversification and resilience to the portfolio. 2 Source: Colliers (2026). 3 Actual RevPAU decreased 26% YoY, on the back of acquisitions and divestments in FY 2024 and FY 2025. Hotels/Serviced Residences Gross Rental Income (JPY’000) Revenue Per Available Unit (JPY) FY 2025 FY 2024 FY 2025 FY 2024 Properties under Master Lease Hotel WBF Honmachi1 - 24,468 - - Sotetsu Grand Fresa Osaka-Namba 1,366,154 1,196,026 - - Sotetsu Grand Fresa Tokyo-Bay Ariake 1,758,249 1,593,753 - - Properties under Management Contract Chisun Budget Kanazawa Ekimae2 564,685 - 4,313 - Citadines Central Shinjuku Tokyo3 1,164,822 1,517,905 19,311 19,041 Citadines Karasuma-Gojo Kyoto4 - 316,404 - 9,313 Citadines Shinjuku Tokyo 1,472,430 1,285,649 25,045 21,954 ibis Styles Tokyo Ginza2 1,199,945 - 16,021 - 1 The divestment of the property was completed on 14 March 2024; hence the gross rental income stated for FY 2024 is for 1 January 2024 to 13 March 2024. 2 The acquisition of the property was completed on 31 January 2025; hence the gross rental income and RevPAU stated for FY 2025 are for 1 February 2025 to 31 December 2025. 3 The divestment of the property was completed on 2 October 2025; hence the gross rental income and RevPAU stated for FY 2025 are for 1 January 2025 to 1 October 2025. 4 The divestment of the property was completed on 8 October 2024; hence the gross rental income and RevPAU stated for FY 2024 are for 1 January 2024 to 7 October 2024.
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