ACCORDING TO A RECENT Pulse Survey Report by Cartus, the BRIC countries – Brazil, Russia, India and China – were the most frequently named destinations to which companies are sending employees. Recent expansion of serviced
apartment providers into the APAC (Asia-Pacific) region follows the path of hoteliers, with China representing particularly worthwhile opportunities. “The move towards smaller cities in China is on the rise,” says Silverdoor’s Stuart Winstone. Raw materials and energy
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resources in China, Korea, Japan and other countries are attracting engineering businesses from the Middle East – in Japan alone, since June 2011, there have been around 200 Middle Eastern engineers staying in serviced apartments for one year or more (The Global Serviced Apartments Industry Report 2011-12). Ascott has taken on
buildings in Beijing, Chengdu (two properties), Wuhan and Xiamen in China, and Bangalore in India, in the past year, being managed variously
under the Ascott, Somerset and Citadines brands. Bridgestreet is undertaking
a thorough examination of opportunities in India, where strong trading links with the US, China, UAE, Singapore and Germany create a vibrant market. “The country is following the same pattern as China: the rural business market is gaining momentum, with some sectors moving into the country’s smaller cities. International trade is following and this offers a tremendous opportunity for us,” says Bridgestreet’s senior vice-president of sales and marketing, Jo Layton. Despite political unrest, the Middle East is still attracting serviced apartment providers. Frasers Hospitality, Ascott and Bridgestreet have all opened properties in Doha, Ascott one in Dubai; Frasers has two in Saudi Arabia and one in Suhar on the cards for 2013, with Dubai in the pipeline; and Ascott opens the 200-unit Somerset Panorama Muscat in Oman in 2014.
The US is still the largest market: “It represents around
60 per cent of the worldwide serviced apartment properties we identified in The Global Serviced Apartments Industry Report,” says TAS’s Charles McCrow. The market is dominated by extended stay hotels, largely provided by the main hotel groups, exemplified by IHG’s Staybridge Suites and Residence Inn by Marriott. The corporate housing sector has in excess of 65,000 apartment units. In addition, US demand in the UK is increasing and SACO has opened a North American office in response to that. “We will also be using this opportunity to work more closely with our US agency partners to provide greater choice of locations and apartments in the US,” says SACO’s Jo Redman. However, managing director
of agency Select Apartments, Simon Morrison, recently discovered that booking processes in the US can be labyrinthine. “They are not as flexible or as painless as in the UK: some providers require leases and deposits – that goes back to the 1990s. They still have some catching up to do,” he says. TAS estimates that the
European serviced apartment
sector (including hotels) was worth Ð150 billion in 2009, a fall of 18.9 per cent over the previous year. But supply is still growing. In 2011, Adagio acquired Citéa and now has nearly 10,000 apartments. Ascott opened two properties in Paris and continues to refurbish Citadines to Prestige level in London, Paris, Lyon, Cannes, Brussels and Barcelona. Frasers is negotiating on a building in Frankfurt. London is Europe’s most expensive city for serviced apartments, ahead of Paris and Moscow, and recent activity in the capital had Think acquiring a property in Vauxhall; and Frasers completing a £2.5 million refurbishment of its Canary Wharf property, plus starting work on one in Queens Gate and adding a building in Bishopsgate. SACO opened extended stay accommodation in Canary Wharf; Oakwood announced an additional 48 units in the capital; and City Apartments is refurbishing a property off Leadenhall Street in the City for opening next year, to complement the City House building it launched 2011.