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Ascott unveils new Tujia Somerset brand of serviced residences in China

CapitaLand’s wholly owned serviced residence business unit, The Ascott Limited (Ascott), has unveiled its new Tujia Somerset brand of serviced residences to cater for the increasing demand from China’s middle class travellers. The joint venture with Tujia.com International (Tujia), China’s largest online apartment sharing platform equivalent to Airbnb, has sealed contracts to manage six serviced residences to be operated under the Tujia Somerset brand.

The announcement marks the first joint branded partnership since Ascott invested GBP55 million in Tujia.com in August 2015. As part of the deal, Ascott also invested a further GBP26 million in a joint venture with Tujia to operate serviced apartments located within the key growth cities of China. This will help to increase Ascott’s number of apartments in the country to 20,000 by 2020.  

At a ceremony to unveil the new brand in Shanghai, Mr Lee Chee Koon, Ascott’s chief executive officer, said: “Ascott’s investment in Tujia provides us with a new pipeline to manage apartments for a growing number of Chinese corporate asset owners, as well as individual homeowners with multiple properties. By leveraging our Tujia Somerset brand, we will be able to spur the growth of Ascott’s management and franchise business in China.

“With Ascott’s expanded suite of products and services in the country, we will be in a stronger position to cater to the varying needs of property owners and guests - and rapidly increase our scale in China with the new Tujia Somerset brand along with our established Ascott, Citadines and Somerset brands. Our aim is to have 2,000 units under Tujia Somerset by the end of 2016. This will give us the added impetus to achieve Ascott’s target of 20,000 units in China and 80,000 units globally by 2020.”  

Mr Lee continued: “Through Ascott’s investment in Tujia, we have been able to integrate our strengths in operating serviced residences globally with Tujia’s online capabilities to offer guests a seamless Offline-to-Online and Online-to-Offline (O2O) experience. Following the listing of our 30 properties in China on Tujia.com, our global properties will soon be available on Tujia.com for booking as well; expanding our reach to more O2O savvy customers who seek quality accommodation for leisure or work.  

The addition of the six Tujia Somerset properties will further reinforce Ascott’s leadership position as the largest international serviced residence owner-operator in China, with more than 15,000 units across over 85 properties in 25 cities.  

The launch of the new Tujia Somerset brand comes as China shifts to a consumption led economy, driven by the burgeoning middle class and with innovation and the internet being major growth areas as announced by Chinese Premier Li Keqiang at the recent National People’s Congress.  

The growth of Chinese middle class consumers will continue to drive demand for domestic and overseas travel. They are estimated to make up over 70 percent of China’s 1.39 billion population by 2030, consuming nearly US$10 trillion in goods and services.

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