Frasers Hospitality, the hospitality and lodging business unit of Frasers Property, has been expanding its presence abroad while simultaneously shedding some of its Singapore assets. According to CEO Eu Chin Fen, this strategy is part of the company’s international expansion plan.
In September, Atelier Capital Partners, a Hong Kong-based family office, acquired the 313-key Capri by Fraser, Changi City hotel for $170 million. This translates to $543,131 per key. The hotel has been rebranded as Dorsett Changi City Singapore, with DHI, a subsidiary of Hong Kong-listed Far East Consortium International, as the operator. DHI is one of the shareholders in the consortium, along with Heeton Holdings and Fortez Capital.
Frasers Property previously acquired the hotel in 2014 for $203.4 million, but FHT, which had the first right of refusal, declined an offer to purchase the property from its sponsor in March. As a result, Frasers Property sold the asset to a third party.
According to Eu, “Real estate is cyclical, and it is important for us to recognize which of our properties have reached the end of their capital cycle and to identify new opportunities where we can invest our capital.” In May, Frasers Property sold Fraser Residence River Promenade to Tuan Sing Holdings for $140.889 million. This property had 72 serviced apartments, which translates to a price of $1.96 million per key. The serviced apartments opened in September 2023, in a newly-built block of a mixed-use development that includes Frasers Property’s 455-unit luxury condo Rivière, which was fully sold.
Established 26 years ago, Frasers Hospitality now manages over 16,000 serviced apartments and hotel rooms across 20 countries. Its six brands include Fraser Suites, Fraser Residence, Fraser Place, Capri by Fraser, Modena by Fraser, and Malmaison, which was acquired in 2015. Eu states that, “We have a reputation as a premium serviced apartment operator, and we have proven that we can add value to the assets we manage.”
Due to the challenging global environment and rising operational costs, Frasers Hospitality is focusing on expanding its presence in existing markets by partnering with established local players and increasing its revenue from management contracts. In the first half of 2024, the company opened three properties in Bahrain, Chengdu, and Shanghai, with an additional nine properties set to open in the next two years in China and Vietnam. The company has also announced eight new management contracts this year, including three in Shanghai, two in Bangkok, and one in Chengdu.
Over the next four years, Frasers Hospitality plans to open 20 more properties, including the nine scheduled to open over the next two years. While the company intends to focus on established markets and gateway cities, it is also exploring opportunities in emerging markets such as Indonesia, Cambodia, Vietnam, Malaysia, and the Middle East.
In February, the company opened its third property in Bahrain, the 63-key Fraser Suites Al Liwan Bahrain. Additionally, Eu stated that, “Within the Middle East region, we see many opportunities for Frasers Hospitality to work closely with local partners to manage and grow their portfolio of long-stay lodging assets.” Frasers Hospitality is also planning to expand its presence in the Taiwanese market with the opening of Frasers Residences Taipei, a 200-serviced-suite property in 2027.
Recognizing the strong demand for long-stay accommodations, Frasers Hospitality is optimistic about this segment and is exploring opportunities to grow its portfolio. According to Eu, “Our management business is highly scalable, and management fees significantly contribute to our overall annual revenue.” The company is also exploring unique opportunities to offer more than traditional hospitality services, catering to travelers who combine business and leisure into a single trip and are willing to pay premium rates for exceptional experiences.