LOS ANGELES—Oakwood Worldwide's $4-billion corporate and serviced apartment deal with Mapletree Group will increase the company's branded US presence. The deal will develop more than 100 properties worldwide over the next five years. As part of the new joint venture, which has been in the works since November of last year, Mapletree will acquire a 49% stake in Oakwood Asia Pacific. Goldman Sachs served as the sole financial advisor in the transaction.

Mapletree will take $2 billion to invest in markets throughout Asia and Europe, while Oakwood will take the additional $2 billion to focus on development in the US. This deal will significantly augment Oakwood's branded US presence. “The numbers that we have are fairly conservative in the US,” Bill Foltz, Oakwood Worldwide CFO, tells GlobeSt.com. “With $2 billion available to invest, I think we are looking at 70 buildings across the US that are branded as Oakwood, and we are sitting on about 12 buildings today. We are looking at a very significant number of Oakwood properties that you will see around the country.”

In the US, Oakwood will focus on gateway business markets, including Seattle, Northern California, Charlotte, Boston, New York and Chicago, because its business serves mainly corporate clientele who are staying an average of 75 days. “It is more than you tend to see in an extended stay. We truly are long-term housing, so you will see us mainly in the major business hubs,” Fultz adds. Internationally, Mapletree will focus on Asia and leverage Oakwood's London office and team to find target markets and opportunities throughout Europe as well.

Mapletree mainly focuses on commercial and retail properties with internal platforms to handle each of those sectors, so entering the serviced housing sector is a new venture. “They are very interested in the serviced apartments and the corporate apartment space, but they don't have a platform to manage those investments. Oakwood Asia Pacific has 28 building standing from Tokyo in the east to as far west as Mumbai with a great reputation. That is what attracted Mapletree in the first place. They wanted to go into the market in a big way, but needed a partner to do it with,” he explains. Mapletree equally wanted a partner to penetrate the US market as well, and approached Oakwood about forming a joint venture.

At that time, Oakwood was also approached by a number of other potential partners. “We could tell the corporate apartment space was heating up,” he says. Earlier this year, GlobeSt.com reported that several tech companies were heating up the sector by seeking corporate housing space for temps and interns. Foltz says that after eight to 10 interviews, they felt Mapletree was the best fit for them.