Ascott and Tujia form JV to launch budget-friendly serviced apartment brand
Ascott with partner with China’s largest accommodation booking platform Tujia to launch a budget-friendly tourism accommodation brand in the first quarter of 2016.
Serviced apartment brand Ascott with partner with China’s largest accommodation booking platform Tujia to launch a budget-friendly tourism accommodation brand in the first quarter of 2016.
Ascott's website offers its three high-end brands
Capitaland subsidiary Ascott has three high-end serviced apartment brands - Ascott, Citadines and Somerset - and is now planning to expand its customer base by launching a budget-friendly brand.
Ascott’s North Pacific general manager Xunjie Wu said rents for an apartment at Ascott, Citadines and Somerset start at RMB10,000 per month. But the general demand is massive for service apartments at RMB5,000 to RMB10,000 monthly rental.
“We are very excited about this business opportunity. I think we can probably fast track this project next year. Our initial thinking is to have a new brand to offer accommodation that target the general public,” he said.
In August this year, Ascott led a consortium to invest RMB67.69 million in Tujia, dubbed China’s Airbnb. Ascott has invested an additional RMB54.15 million to set up a joint venture with Tujia.
Ascott will leverage the joint venture to operate its new brand of serviced apartments in major Chinese cities. Such apartments will comprise newly acquired properties and Tujia-listed properties that are suitable for converting into serviced apartments under the new brand.
At present, Ascott’s serviced apartments in China can be booked via Tujia’s website. As China’s outbound traffic grows, Ascott will begin offering its overseas serviced apartments for booking on Tujia’s website next year.
Tujia lists over 310,000 apartments for booking. They are located in 388 tourism destinations in China, Singapore, Tokyo and Bangkok.
Capitaland’s chairman and CEO Lim Ming Yan said the group will continue to bolster development in China’s five clusters of cities – Beijing and Tiajin; Shanghai, Ningbo, Hangzhou and Suzhou; Guangdong and Shenzhen; Chengdu and Chongqing; and Wuhan.
Over the next three years, some of the group’s development projects in China will be completed, including Shanghai shopping mall LuOne and the Raffles City integrated property project in Changning, Shanghai.
Mr. Lim said that while the international media suggest China’s economy is slowing down, the fact is China’s GDP has been rising over the last 10 years, and the current growth rate, even at 6.5% to 7%, is still considerable.(Translation by David)