After doubling the size of its portfolio under management in just five years, The Ascott Limited, the hotel subsidiary of Singaporean investor CapitaLand Investment, has adopted a new growth plan, with Europe and France set to play a central role. Ngor Houai Lee, chief operating officer EMEA, South Asia and China, explains in an interview with Business Immo.

Business Immo: This summer, The Ascott Limited announced that its European portfolio would soon exceed 8,000 rooms. Where does your group stand today in its growth plan?

Ngor Houai Lee: Ascott is the hotel subsidiary of CapitaLand Investment, one of the world's leading real estate platforms listed in Singapore, and is celebrating its 40th anniversary this year. As an investor and operator, we are present in over 230 cities and 40 countries worldwide through 14 brands of hotel residences, hotels and flex living. In 2023, we enjoyed a record year with the opening of 9,600 units, enabling us to reach our inventory target of 160,000 rooms under management at the beginning of 2024, a year ahead of schedule. As such, our portfolio has doubled in the space of just five years. And, of course, we don't want to stop there.

What are your main growth drivers?

We have the possibility of expanding through real estate investment, particularly in Europe, but for us this will depend more on market opportunities than on a growth strategy. We still have an appetite for investment and continue to look at projects, but this will not be enough to achieve our goal of doubling in size every five years.

To pursue this strong growth, we are currently adopting an asset-light development strategy, focusing above all on signing management contracts and developing a franchise platform. In Europe, 70% of our portfolio is operated under the Citadines brand, which is in fact our main growth vector today.

How do you adapt your offering to trends observed in European markets?

With the rise of telecommuting, a practice that has become relatively commonplace today, we can see that the boundary between leisure and work travel is becoming blurred, often leading to slightly longer lengths of stay. However, our apartment-hotel model - designed as a hybrid with much larger common areas, coworking facilities and shared kitchens - makes it possible to accommodate long stays of a few months as well as short stays of a few nights, and thus to meet the needs of both corporate and leisure customers. This flexible product has been in the spotlight since the Covid-19 pandemic, when its resilience attracted investors and property owners.

What role does Europe play in your growth strategy?

Europe is an essential market in our global strategy. In fact, as of June 30, 2024, it accounted for around 16% of Ascott's worldwide revenues per available unit. Our goal is to double this contribution to 30% by 2028, and thus become one of the top three contributors to Group revenues.

We want to continue consolidating our presence in cities where we are already established, particularly in France, Ireland, England, Belgium, Spain, the Netherlands and Germany. We also want to open up our strategy towards Southern and Eastern Europe, mainly in Hungary, Poland, Spain, Italy and Portugal.

What about France?

Paris, where we currently have 17 residences, remains an important target for us and the heart of our European development strategy. We will soon be opening a lyf residence and, after acquiring the Citadines Saint-Germain in 2022 from an owner with whom we had a commercial lease until then, we are preparing to reposition it as a 5-star Crest Collection by 2028. At the same time, we remain very active in terms of franchise development in France's regional metropolises.

Today, 60% of brands in France are still individual, independent and non-franchised, in contrast to the US market where 60-70% of brands are franchised. Franchising opportunities are therefore significant in France and Europe, which could provide us with a great platform for growth. In addition, we are planning to launch a renovation plan for all our Citadines residences by 2030.