Frasers Hospitality Accelerates Growth Asset Recycling And Management Contracts
Frasers Hospitality, the hospitality and lodging business unit of Frasers Property, has recently divested some of its assets in Singapore while expanding its presence overseas. According to CEO Eu Chin Fen, this was part of the company’s strategy to recycle and redeploy capital for international expansion.
Earlier this year, a consortium led by Hong Kong-based Atelier Capital Partners purchased the 313-room Capri by Fraser, Changi City hotel for $170 million. The hotel has been rebranded as Dorsett Changi City Singapore and is operated by Dorsett Hospitality International, a subsidiary of Far East Consortium International. The consortium also includes Heeton Holdings and Fortez Capital, both Singapore-listed companies.
In May, Frasers Property sold the 313-room Capri by Fraser, Changi City hotel for $170 million, equivalent to $543,131 per room. The hotel was originally acquired by Frasers Property in 2014 for $203.4 million. It is part of a mixed-use development that includes the Changi City Point shopping mall and has a remaining lease of 45 years.
In March, Frasers Hospitality Trust (FHT), managed by Frasers Hospitality since its listing in 2014, declined an offer from its sponsor, Frasers Property, to purchase the hotel. As a result, Frasers Property sold the asset to a third party.
“Real estate is a cyclical business, and as a portfolio manager, it is essential for us to identify the end of a property’s capital cycle and to find opportunities to recycle that capital into other investments,” explains Eu Chin Fen.
One of these investments was the sale of Fraser Residence River Promenade to Tuan Sing Holdings for $140.889 million in May. The serviced apartments, located on Jiak Kim Street, consist of 72 units and were opened in September 2023. They are part of a mixed-use development that includes Frasers Property’s 455-unit luxury condo, Rivière, which was fully sold upon completion in 2023.
With over 26 years of experience, Frasers Hospitality currently manages more than 16,000 serviced apartments and hotel rooms in 20 countries. It operates six different brands, including Fraser Suites, Fraser Residence, Fraser Place, Capri by Fraser, Moderna by Fraser, and luxury brand Malmaison, acquired in 2015. According to Eu, the company has a strong reputation as a premium serviced apartment operator and has consistently delivered value to the assets it manages.
In the current challenging global environment and rising operational costs, Frasers Hospitality aims to expand its presence in existing markets through partnerships with established local players. This will assist in increasing revenue contributions from management contracts, explains Eu.
In the first half of 2024, Frasers Hospitality opened three new properties in Bahrain, Chengdu, and Shanghai. It also announced nine additional properties set to open within the next two years in China and Vietnam.
Three of these properties are located in Shanghai: Fraser Place Wujiaochang Shanghai with 210 rooms, which opened in June; Modena by Fraser Wujiaochang with 307 rooms, set to open next year; and Fraser Place Pudong Shanghai with 205 rooms, scheduled for 2027.
In addition, Frasers Hospitality has partnered with Chinese developer Poly (Sichuan) Investment and Development Co. to launch its first Fraser Place-branded project in Chengdu. Fraser Place Chengdu, with 238 rooms, opened in March and features a mix of studios to three-bedroom serviced apartments.
The company has also announced two new properties in Bangkok, Thailand, Fraser Suites Bangkok with 261 rooms set to open in 2026, and a 210-room white-label serviced apartment in the same development. Both properties are part of the new US$3.9 billion ($5 billion) mixed-use development, One Bangkok, developed by TCC Assets, a subsidiary of Thai conglomerate TCC Group. Frasers Property, also a member of TCC Group, is involved in the project.
“Our management business is highly scalable, and the management fees contribute significantly to our overall annual revenue,” says Eu.
Over the next four years, Frasers Hospitality plans to open 20 properties, including the nine scheduled to open in the next two years. While the company will focus on established markets and gateway cities, it is also eyeing opportunities in emerging markets such as Indonesia, Cambodia, Vietnam, Malaysia, and the Middle East.
In February, Frasers Hospitality opened its third property in Bahrain, the 63-room Fraser Suites Al Liwan Bahrain. The serviced apartments are part of a mixed-use project developed by Bahrain-based real estate developer Seef Properties, featuring residences, commercial and hospitality components.
“We see many opportunities in the Middle East region to work closely with local partners to manage and grow their portfolios of long-stay lodging assets,” says Eu. The company intends to offer more unique experiences beyond traditional hospitality services under its different brands, such as Capri, to cater to the growing demand for long-stay accommodation in the region.
Frasers Hospitality is also optimistic about the long-stay accommodation segment, given the current challenges in the residential rental market and increasing demand for quality accommodations. “Our capital partners are also keen on investing in premium accommodation assets,” says Eu.
In 2027, the company will open its first premium serviced apartment in Taipei, Taiwan, called Frasers Residences Taipei, with 200 serviced suites in the prime Beitou district. The property is developed in partnership with Taiwanese real estate developer Hung Tai Group and will be managed by Frasers Hospitality upon completion.
A year ago, Frasers Hospitality formed partnerships with US real estate group Tishman Speyer and Asian real estate investment firm Alyssa Partners to acquire and develop a 325-unit project in Shenzhen and a 124-unit project in Osaka, respectively. The combined acquisition cost was $170 million, adding 449 rental housing units to Frasers Hospitality’s portfolio in China and Japan.
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The company is also collaborating with Yotel to launch the brand’s first property in Japan, Yotel Tokyo Station, with 171 rooms, in early 2025. The property is within walking distance of Tokyo Station and offers easy access to dining, shopping, and entertainment amenities.
“Long-stay lodging assets have become increasingly resilient and attractive as an asset class,” says Eu, highlighting their lower income volatility compared to hotels. Frasers Hospitality will continue to refine its brand proposition, particularly for its long-stay brands, to offer unique, memorable experiences beyond traditional hospitality services.
“Travellers are increasingly opting for longer stays, combining business and leisure travel into a single trip,” adds Eu. This shift has led to a willingness to pay premium rates for quality and value, with local experiences being a key factor. Frasers Hospitality aims to cater to this demand in the international market with its premium hospitality offerings.
