GIC joins lifestyle brand citizenM’s two existing shareholders ahead of global expansion plans.
citizenM hotels, KRC, APG and GIC, Singapore’s sovereign wealth fund, have signed an agreement whereby GIC will acquire a 25% stake in citizenM valuing the company at €2 billion, securing a future of exciting growth for the award-winning Dutch hospitality brand.
From the start citizenM hotels was capitalized by two shareholders – KRC Capital, the investment vehicle of entrepreneur Rattan Chadha, and APG, the largest Dutch pension investor (on behalf of its pension fund clients). Both KRC and APG will continue to support the further growth of the company by committing fresh capital. GIC will become citizenM’s third investor. In total KRC, APG and GIC have committed to invest a further €750 million of equity for future expansion, which goes well beyond the current secured development pipeline.
Rattan Chadha, founder & executive chairman of citizenM hotels said, “We are excited to have GIC as our new investor. This move will help strengthen our position as one of the leading affordable luxury brands in the industry. With our bold expansion plans for the coming years, we are thrilled to have the financial support of investors who trust our vision and are instrumental in securing our future success.”
In the 11 years following its first opening at Amsterdam’s Schiphol Airport, citizenM hotels has gone from strength to strength towards becoming the leading transformational hotel for the new generation of modern travellers. With its owner-operator model, lean operational cost structure, and a robust tech-forward approach, citizenM has been expanding its global portfolio smoothly and continuously across gateway cities in Europe, North America and Asia. The growth of the company is expected to further accelerate through the delivery of its secured development pipeline representing an additional investment in excess of €1.5 billion. With the support of its existing investors and the new investor – GIC – citizenM hotels will bring its ‘affordable luxury’ philosophy to even more world-class cities across the globe.
Lee Kok Sun, Chief Investment Officer of GIC Real Estate, said, “citizenM represents an attractive value proposition of affordable luxury in urban markets. It is well-received by consumers who are increasingly placing value in experience and authenticity. As a long-term global investor, we believe this is a good addition to our overall portfolio of quality assets, and look forward to partnering with the citizenM management team to further add value to citizenM as they expand globally.”
Robert-Jan Foortse who is responsible for the European property portfolio of APG added: “Eleven years ago we supported Rattan Chadha when he created citizenM. Together, we have been on an incredible, and rewarding, journey ever since. With this transaction we achieve another milestone. We are very pleased to welcome GIC as an investor in citizenM. We have successfully worked with GIC on many other occasions. With the increase in committed capital, citizenM can further accelerate its growth strategy. We look forward to the next part of this exciting journey.”
Morgan Stanley & Co. International plc acted as sole financial advisor and Stibbe N.V. acted as legal advisor to citizenM and its shareholders in connection with the transaction. HSBC Bank Plc, in their capacity as citizenM's global banking partner since 2010, has acted as general corporate lending advisor in the transaction. The transaction is subject to merger control clearance.