Briefing: Serviced apartment sector is mature and growing
A new report from Travel Intelligence Network (TIN) shows that there has been a 14% growth in the serviced apartment supply chain globally since last year. The report, commissioned by The Apartment Service, found that there are almost 750,000 serviced apartments worldwide. It shows that serviced apartments are increasingly used by businesses for project work. And, like the rest of the hospitality industry, this sector has not gone unaffected by changes in distribution with 75% of operators receiving bookings from OTAs.
As serviced apartments gain prominence in the hospitality industry, four experts discuss the unique benefits and challenges of business and investment in the sector:
According to The Apartment Service: ‘The report highlights that the serviced apartment industry has reached a level of maturity that is showing future growth of supply.’ Deals are being done across the industry. At the end of 2014 there were approximately 1.700 units in the development pipeline in London according to the UK Serviced Apartment Report – Q4 2014 by Savills. There is also strong industry growth in Scotland with RevPAA up 16.2% year on year.
A recent merger between SACO and Oaktree Capital Management, announced on the 2nd March 2015, has resulted in the formation of a £60m hospitality company. The combined company has an inventory of 1645 apartments and is launching a new brand – Beyonder ApartHotels, which will focus on millennial travellers and will open its first ApartHotel in December 2015.
Frasers Hospitality announced the development of a new property in Hamburg recently (20th March 2015) which is the 50th city the company has entered.
Dublin based serviced apartment company StayCity has 1000 apartments across Europe and is due to open properties in Birmingham, Lyon and London in 2015.
And an industry leader BridgeStreet Global Hospitality, which rebranded last year, is going strong with 50,000 apartments in 60 countries and a collection of awards.
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Video clips produced by yBC for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.