REAL-ESTATE developer Cebu Landmasters Inc. (CLI) said on Thursday it will be needing around P5 billion to achieve its target to double the number of apartment units—from 804 to 1,600—by 2022, across four or five serviced residences in the Visayas and Mindanao (VisMin) regions under The Ascott Limited (Ascott) brands.
CLI CEO Jose Soberano III estimated the range of investment per hotel with around 200- to 250-key inventory would be about P1 billion to complete.
“So to double up that figure in the next four years, P5 billion would be a figure we hope to be able to come up with to achieve that double number, inflation rate considered,” he told reporters during their signing of a memorandum of understanding at The Ascott Makati in Makati City.
To date, CLI has a total portfolio of 969 rooms. Its serviced residence projects with The Ascott Limited include the 180-room Citadines Cebu City in Base Line Center, the 250-room Citadines Paragon Davao to be operational by 2021, the 180-room lyf Cebu City in Base Line Prestige set to open in 2021, and the newly launched 200-room Citadines Bacolod City that will open by the fourth quarter of 2021.
The Citadines brand caters to independent travelers who want flexible services, while its newest lyf brand is designed by millennials for millennials, with co-living collaborative concepts.
Soberano said the areas they are eyeing as locations for the new Ascott properties will include Mactan in Cebu; Panglao, Bohol; Cagayan de Oro; Iloilo; and Dumaguete.
“The tourism industry in the VisMin region is flourishing and government infrastructure projects are complementing the area’s rapid growth,” Soberano said, adding both parties “have decided to combine our areas of expertise in order to provide properties that will address the specific needs of each market.”
He said they are now in talking terms with some property owners in those sites and hope to be able to conclude all of these acquisitions before the end of the year.
Soberano said their strategic alliance with Ascott will help increase their hospitality portfolio and expand to key cities in VisMin areas.
“Ascott’s expertise in the hospitality business is a good counterpart for our familiarity with the VisMin market,” he said, noting their collaboration will strengthen the company’s recurring income base.
“By 2022, CLI is principally addressing the housing shortage. This will contribute again to the turnaround income the company will continue to enjoy in the coming years. But more and more, as we develop more of our product lines including hospitality business, we hope to increase the contribution to something like 20 percent. And this recurring income base of 20 percent, I think to a certain extent, maybe half of which will now be contributed by the hospitality business,” Soberano said.
Ascott said the alliance with CLI in the Philippines builds on the strategic partnerships it has forged around the world to accelerate its global growth.
“Leveraging Ascott’s global network and strong hospitality expertise, as well as CLI’s well-established reputation in the Philippines, the partnership will allow us to gain access to a pipeline of quality projects in the country. This will fast-track our expansion and strengthen Ascott’s leadership position as the largest international hospitality player in the Philippines,” said Kevin Goh, CEO of The Ascott Limited.
“Having leading industry players choose to partner, Ascott speaks volume of the value we bring to our partners. We are confident Ascott will exceed 80,000 units in 2018 and expand to 160,000 units worldwide by 2023,” he added.
Singapore-based The Ascott Limited is a wholly-owned subsidiary of CapitaLand. It is one of the leading international serviced residence owner-operators with more than 500 properties in over 130 cities spanning more than 30 countries across the Americas, Asia Pacific, Europe, the Middle East and Africa. Its portfolio of brands includes Ascott, Citadines, Somerset, Quest, The Crest Collection and lyf.
In the Philippines, for 18 years, The Ascott Limited is the largest hospitality player with 20 properties offering over 4,300 units. These include seven operating properties and 13 projects under development in Metro Manila, Cebu, Davao, Iloilo and Bacolod. Of this, 1,085 units are in VisMin of which 804 units or 74 percent is CLI’s.
CLI, founded in Cebu in 2003, was recently awarded one of BCI Asia’s Top 10 Developers of the Philippines and is the only one from the VisMin region.