Briefing: The opportunity and challenge of hospitality alternatives

A report by JLL has found that serviced apartments account for less than 10% of total room inventory in London – and in UK regions account for only 3.9%. This highlights that there is still a lot of opportunity for serviced apartments and other types of alternative accommodation to grow. But are these relatively new products less attractive to investors?

Four hospitality experts discuss the performance of hotel alternatives:

JLL’s report found that there are over 1,500 serviced apartment rooms due to open in London between now and 2019. This shows that the sector is only going to become more mainstream, and with that there will be more evidence on performance for investors.

As discussed in the above videos, some regions across the globe, such as the US, have a bigger alternatives market than others. JLL states that the number of serviced apartment rooms vs hotel rooms in Singapore is higher than in London with 10% of total room supply.

In Europe, the market is still developing. According to JLL, the key serviced apartment operators at the moment are AccorHotels, The Ascott Limited, BridgeStreet Global Hospitality, Frasers Hospitality, and Go Native. They also state that some up and coming operators are Staycity, Zoku and Starwood Capital.

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Serviced Accommodation gets five-star recognition

The AA is now taking applications for its new Serviced Accommodation accreditation scheme. Unlike the hotel scheme, which rates properties from one to five stars, the new scheme only accredits properties which achieve a quality rating of three to five stars. This expansion of the AA’s services is a response to the growth of the industry and reflects the increased consumer awareness of the sector.

In these videos experts discuss customer expectations of serviced apartments, and the similarities and differences to hotels.

There is an existing accreditation scheme within the industry run by the The Association of Serviced Apartment Providers (ASAP). However, this addition could further expand interest in serviced products.

The AA Serviced Accommodation Scheme recognises 9 designators within the sector including Extended stay, Corporate Housing, Serviced Apartments, Budget, Studios and Aparthotel.

Product definition has been a continuing challenge for the industry. In its quality standards, the AA scheme clearly differentiates between Corporate Housing and Aparthotels, while ‘Serviced Apartment’ acts as a catch all designator. A separating criterion, for example, is that Corporate Housing would have a minimum stay and Aparthotels would not. Also aparthotels would have a fixed inventory and corporate housing would have flexible inventory.

The scheme scores the properties across 11 elements, which must all achieve a minimum standard to achieve a star rating. These elements include overall ‘hospitality’ (interaction and customer care), overall ‘service’ (staff performance and information provided), cleanliness, bedroom, bathroom etc.

The AA has been around for over 100 years and is one of the UK’s most recognised and trusted brands. The AA currently accredits Hotels, Restaurants, Guest Accommodation, Self-Catering accommodation, and Caravan and Campsites. The latest version of the AA Hotel Guide has details of over 3,500 establishments.

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Purpose built products for diverse consumers

A new trend report from Sabre has announced that ‘Demographics are dead’. You can no longer presume what any one consumer group will want, but you can build products that meet new expectations and invite individuals to enjoy them. The report says ‘Consumers love brands with meaning and personality’ and that 63% of global consumers claim to buy products and services that appeal to their beliefs, values or ideals.

These videos discuss creating products to meet consumer needs:

There is a growing consumer awareness of what is possible. There are many niche needs, new trends and individual desires that can be catered to with carefully designed products. The report states that 65% of consumers say bands should take a leading role in supporting individual happiness.

As the above videos reflect, many new products are fighting cater to new consumers’ needs but a strong identity and a unique angle, be it experience or price, can set a brand apart.

The study also identifies helpfulness and personalisation as two key elements of future hospitality products. Generic advertising is losing popularity. Instead brands must connect with individuals and demonstrate an understanding of them.

Trends in Sabre’s report were identified by TrendWatching, powered by a global network of 3,000+ trend spotters.

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Corporate travel demand is growing

According to Reuters, spending on business travel in Western Europe is expected to rise by over 6% in 2016. This is good news for serviced apartments and extended stay products, which see a lot of demand from this sector.

A report from the Association of Serviced Apartment Providers states that UK businesses registered an 86% increase in the use of serviced apartments in recent years. They also say that Booking.com is experiencing strong growth demand for serviced apartments.

These videos discuss corporate travel and serviced apartment demand:

A report by Accura Media Group found that four out of ten business travellers surveyed said they will travel more in 2016 than last year, while more than half say they will travel more than they did two years ago.

According to Reuters, Germany is the largest business travel market in western Europe at an estimated $57.9 billion, and spending is set to rise 9.5 percent in 2016.

In contrast a new report from the Global Business Travel Association found that business travel volume growth in US is slowing in 2016 due to global uncertainties, but the report still says there are reasons to be optimistic for 2017.

Association of Serviced Apartment Providers found that occupancy figure for serviced apartment across the whole of the UK were high. London was at 84% and the rest of the UK just slightly lower at 83.1%.

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

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