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Ascott Limited’s strategic acquisition of Oakwood Worldwide bolsters its position in the extended stay sector, expanding to 48 cities with significant growth.
SINGAPORE – The Ascott Limited (Ascott) shared an update on its Oakwood portfolio. The update follows its strategic acquisition of Oakwood Worldwide in 2H 2022, which leapfrogged Ascott’s growth and cemented its global position as one of the top three extended stay serviced residence providers in the world. Since the acquisition, Ascott has expanded Oakwood’s presence to 48 cities, entering new destinations including Busan in South Korea, Batam and Bali in Indonesia, Penang and Kota Kinabalu in Malaysia, Visakhapatnam, Chennai and Navi Mumbai in India, as well as Ha Long in Vietnam. With almost 18,000 units to date, the Oakwood portfolio has grown by more than 20% post-acquisition, making it one of the fastest growing global brands in the Ascott portfolio with over 20 new signings since the acquisition.
The acquisition of Oakwood is a strong showcase of Ascott’s capabilities to leverage opportunities for growth. Oakwood properties have since been onboarded to Ascott’s loyalty programme, Ascott Star Rewards; global sales and marketing platforms; revenue and distribution network; digital and technology systems, as well as integrated with functions including operations, finance, human resource, and procurement. The successful integration of the brand into Ascott’s ecosystem enabled it to drive revenue uplift, improve operational efficiencies and optimise cost synergies of the Oakwood portfolio. By enhancing its conversion-friendly value proposition, Ascott won over new contracts of properties managed by other operators and expeditiously transitioned them to operate under its Oakwood brand. For example, Oakwood Hotel & Apartments Taman Mini Jakarta and Oakwood Makati Avenue were newly inked properties in 2023 which were swiftly converted and went into operations within months of signing.
Mr Kevin Goh, Chief Executive Officer for Ascott and CLI Lodging, said: “Ascott’s operational efficiency and commitment to disciplined growth are evident in the smooth integration of the Oakwood portfolio into Ascott’s operational framework. The uplift in revenue and improved margins are testament of Ascott’s ability to leverage pricing power and meet market demand, contributing to an overall enhanced financial performance of the Oakwood portfolio post-acquisition. With more operationally ready properties coming onstream at a faster pace, we are seeing immediate contribution of the Oakwood portfolio to Ascott’s recurring fee income; which is in line with our aim to double fee earnings to more than S$500 million by 2028.”
“Ascott will continue to pursue transformative deals which can accelerate our expansion and provide us with immediate access to new markets, diverse customer bases, and valuable synergies. The strategic benefits of inorganic expansion extend beyond incremental growth. They have empowered us to unlock economies of scale, streamline operations, and enhance overall competitiveness over the years. Coupled with our continued focus on organic signings of management and franchise contracts, we not only intend to keep pace with industry trends but to break new grounds and stay ahead, positioning Ascott as a global leader in hospitality. Ascott is on the cusp of a transformative journey as we mark our 40th anniversary this year. We look forward to gaining strong growth momentum, to owning the upswing with the rebound of global travel and tourism in the year ahead,” added Mr Goh.
The Oakwood brand was built on the foundation of established standards and reliability. It has developed a strong reputation in corporate travel over the years since pioneering the serviced apartment concept in 1962. Tapping on the rising trend of blended travel as guest preferences evolve, the brand will be refreshed to prepare for its next stage of growth. Beyond serviced apartments, Ascott is extending the coverage of the refreshed Oakwood brand to more city hotels and even full-service resorts. For example, Oakwood Ha Long opened recently in Vietnam while Oakwood Hotel & Apartments Benoa Bali in Indonesia as well as Oakwood Suites Chongli in China are expected to follow suit in popular resort locations in the first half of this year.
With comfort at the core of well-being, the refreshed Oakwood brand aims to exemplify unwavering dependability in providing the comforts of home and beyond to guests, no matter where their journeys lead to. Building on the foundation of comfort of the Oakwood brand, Oakwood Premier will add a touch of luxury for an elevated stay experience for guests.
Ms Tan Bee Leng, Ascott’s Managing Director for Brand & Marketing, said: “Against the backdrop of the surge in bleisure travel, a portmanteau of business and leisure, we have harnessed Oakwood’s deep-rooted understanding of corporate travel, to kickstart a brand refresh that aligns with the needs of business travellers today. With the rise of telecommuting and flexible schedules, business travellers increasingly view work trips as opportunities to extend their stays for leisure purposes. The refreshed Oakwood brand seeks to balance our guests’ work commitments with their desire for personal wellness and enrichment when travelling, prioritising comfort above all else.”
Ms Tan added: “From in-property amenities to enjoy the comforts of home, productivity tools to enable business connectivity, to thoughtfully-curated activities to seamlessly blend work and leisure, our refreshed Oakwood brand aims to address this growing market of business professionals who increasingly value holistic travel experiences. As more business travellers become more inclined to explore unique locations and cultural offerings, turning business trips into multifaceted experiences, our pipeline of Oakwood properties will be opening not just as serviced apartments catering to longer stay residents, but also as city hotels and in resort locations, targeting guests going on brief sojourns and weekend getaways.”
The Oakwood brand refresh comes on the back of the refreshed Citadines, Somerset, and Ascott brands, which were unveiled over the last two years. It is part of Ascott’s Brand-360 strategy, a groupwide exercise to strengthen its brand portfolio through sharpened brand stories and the introduction of signature experiences and programmes unique to each brand.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
