Highlights

• CLAS has recycled capital by deploying divestment proceeds from The Robertson House to acquire the higher-yielding Coliwoo Midtown with an EBITDA yield of 4.1%. The transaction is estimated to be 2.4% accretive to DPU.
   
• CLAS has sizeable past divestment gains totalling S$300m, which could be distributed to offset negative impact from ongoing AEIs to stabilise DPU.
   
• CLAS continues to create value through disciplined portfolio reconstitution. It provides an attractive 2027F DPU yield of 7.3% due to unit price correction of 13.1% ytd. Maintain BUY. Target price: S$0.99.
   

Analysis

• Acquiring Coliwoo Midtown in Singapore. CapitaLand Ascott Trust (CLAS) has completed the acquisition of Coliwoo Midtown for S$134m on 30 Sep 26, recycling capital from the divestment of The Robertson House into a higher-yielding asset with an EBITDA yield of 4.1%. The asset has a 10-year triple-net master lease with fixed rent and annual indexation. The transaction is estimated to be 2.4% accretive to DPU. Located in the Bugis-Bras Basah precinct, Coliwoo Midtown has 212 rooms, ranging from two- to five-bedroom units. The newly refurbished property benefits from inflows of international students and expatriate professionals seeking flexible accommodation. Educational institutions nearby include Singapore Management University, School Of The Arts, Nanyang Academy of Fine Arts and LaSalle. It is conveniently located near four MRT stations, namely Bencoolen, Bras Basah and Bugis and Rochor.
   
• Singapore’s co-living market is underpenetrated. Coliwoo Midtown’s occupancy was 90% in Jul 26, while the average length of stay was six to nine months. The potential to top up the remaining 51-year leasehold tenure to a fresh 99-year lease strengthens the asset’s long-term investment appeal. Living assets now account for 19.5% of portfolio valuation, moving closer to its medium-term allocation target of 25-30%.
   
• Divested The Robertson House in Singapore. CLAS has completed the divestment of The Robertson House by The Crest Collection for S$360m, representing an attractive exit yield of 2.3% and a premium of 4.0% above book value, in Jul 26. The selling price was attractive at about S$1.1m per key. The transaction generated net proceeds of S$342m and net gain of S$38m. The divestment underscores CLAS’ disciplined capital recycling strategy, which enhances financial flexibility to redeploy capital into higher-yielding assets. Singapore remains one of CLAS’ core markets with the ongoing redevelopment of Somerset Clarke Quay.