CAPITALAND'S serviced residence arm, The Ascott (Ascott), is setting up a joint venture with Nasdaq-listed Huazhu Hotels Group (China Lodging Group) and apartment rental firm CJIA Apartments Group to expand its Citadines brand in China.
With a market capitalisation of USD 10.4 billion, Huazhu has the third largest market share in China's midscale hotel segment with a total portfolio of over 380,000 hotel rooms. Its subsidiary CJIA collaborates with over 100 property management firms to offer 10,000 apartments.
The joint venture will have an initial registered capital of 100 million yuan (USD 21 million), with Ascott, Huazhu and CJIA holding 50%, 10% and 40% respectively in the partnership. In the initial years, the JV will expand Citadines' footprint in first-tier cities such as Shanghai, Beijing and Shenzhen. It has secured its first property in the Pudong district of Shanghai.
The joint venture is targeting 16,000 units under the Citadines banner by 2025, which would more than triple Ascott's existing Citadines portfolio in China.
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