US: CapitaLand Ascott Trust (CLAS) has acquired the remaining 10 per cent stake in Standard at Columbia, a student accommodation property in South Carolina.
The 678-bed Standard at Columbia serves more than 35,000 undergraduate and graduate students from the nearby University of South Carolina (USC).
For the upcoming academic year 2024-2025, the pre-leasing occupancy rate has reached 99 per cent (as of May), with rental growth of about four per cent compared to 2023-2024.
CLAS has acquired Standard at Columbia in phases over three years. In June 2021, CLAS and its sponsor, The Ascott Limited, jointly invested to own 90 per cent of the student accommodation property. CLAS subsequently acquired Ascott’s 45 per cent stake in November 2022.
Serena Teo, CEO of CapitaLand Ascott Trust Management Limited and CapitaLand Ascott Business Trust Management Pte. Ltd. (the managers of CLAS), said: “The acquisition of Standard at Columbia is in line with CLAS’ strategy to marry stability and growth to generate long-term returns to stapled securityholders. Recycling capital from our divestment proceeds into this longer-stay asset with strong operating performance will further boost our returns.
“With an average length of stay of about one year, student accommodation properties enhance CLAS’ stable income stream and strengthen our portfolio’s resilience against macroeconomic uncertainties. It diversifies our portfolio which also comprises hospitality assets such as serviced residences or hotels that allow us to capture travel demand for growth income.
“In Q1 2024, we completed the acquisition of a rental housing property in Japan,” Teo continued. “We will continue to seek accretive investments in properties in prime locations within key capital cities with strong demand drivers and selectively undertake development projects with higher yields. In the last year, we announced divestments of S$408.1 million comprising 10 mature assets at a premium to book value and an average exit yield of about 3.8 per cent. In addition, we have seven properties that are undergoing or will undergo asset enhance initiatives (AEI). When completed, the AEIs will uplift the value and profitability of our portfolio, positioning CLAS for sustained growth,” she added.
Today, CLAS has nine operating student accommodation properties, with eight located in the USA and one in Japan totalling more than 4,500 beds.
