Ascott Residence Trust (Ascott Reit) has acquired three serviced residences and four rental housing properties in Australia and Japan for S$298.3 million (US$221.8) at an Ebitda yield of 5.1%.

These accretive acquisitions are expected to increase Ascott Reit's distribution income for 2014 by S$3.9 million and distribution per unit by 2.9% from 8.20 cents to 8.44 cents on a pro forma basis.

Ascott Reit will acquire the 380-unit Citadines on Bourke Melbourne from The Ascott Limited (Ascott) for AUD158.5 million (S$167.6 million). Ascott Reit will also acquire the remaining 40% interest in the 160-unit Citadines Shinjuku Tokyo and 124-unit Citadines KarasumaGojo Kyoto for 3.04 billion yen (S$33.7 million) and 1.44 billion yen (S$16.0 million) respectively from Ascott.

The three serviced residences will continue to be managed by Ascott. In addition, Ascott Reit will acquire four rental housing properties in Osaka for 7.3 billion yen (S$81.0 million). Ascott currently holds an 18.9% stake in the four rental housing properties.

Lim Jit Poh, Ascott Residence Trust Management Limited's (ARTML) chairman, says: "These yield accretive acquisitions will expand Ascott Reit's portfolio in the stable and established markets of Australia and Japan where there is significant potential for us to grow. Australia is one of the top 10 global destinations for foreign direct investment and ease of doing business."

"International visitor arrival numbers of both Australia and Japan reached record high last year. Japan's government is aiming for 20 million visitors by the 2020 Tokyo Olympic Games and has also created special zones to attract foreign companies to set up offices. Hence, we expect strong demand for these properties which will further enhance Ascott Reit's portfolio." 

The seven prime assets with 1,152 apartment units will broaden Ascott Reit's earning base and increase its scale to 11,368 apartment units in 95 properties across 39 cities, further diversifying portfolio across key cities globally. Ascott Reit's asset size will also grow from S$4.1 billion to S$4.4 billion, bringing it closer to its target asset size of S$6.0 billion by 2017.