Serviced apartments IN BRIEF
■ The Cheval Group’s Cheval Three Quays, next to the Tower of London, held its topping-out ceremony in January and is due to open early 2014. Last year also saw two major refurbishments, for Cheval Calico House in the City and Cheval Knightsbridge.
Cheval
suggesting an extra 1,200 units in the next five years (an increase of 15 per cent). Compare this with future hotel stock – there are an estimated 56,000 rooms in central London with an additional 4,700 to be added over the same period. Is London’s serviced apartment stock and availability an issue for buyers?
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Procurement service Agrega’s head of global travel, Thomas Lorenz, doesn’t think so: “We use them in London and our top stays are in serviced apartments because it is a good way of saving money. Although we don’t have a very mature programme in this sector, London does have a mature serviced apartment market – we have some great uptake and no problem with availability.” Patrick Hegan, international partner relations manager for serviced apartments agency Silverdoor, agrees: “London has an enormous amount of successful professional serviced
apartment operators. It’s very mature and business travellers know it – this is a success story.” However, Go Native’s founder and
CEO, Guy Nixon, thinks the serviced apartment sector is losing out in London compared with other major business destinations globally. According to the Savills/Go Native report, Hong Kong has 5.3 serviced apartments per 1,000 business travellers, Singapore has 2.8 per 1,000 and London has less than half of that, with 1.2 apartments per 1,000 business travellers. Nixon says: “London is chronically undersupplied and the downturn has been complex. There has been a lot less debt available to support any development and, at the same time, London is seen as a safe haven for overseas investors, so they are pushing prices up – not entirely helpful for people trying to get hold of properties.” Marlin Apartments owns all of its six properties in London and
■ Deep Blue Apartments launched its ‘flying butler’ service in February. The service includes transfers from any London airport or train station, grocery deliveries, additional housekeeping and a dry- cleaning service. It’s available at apartments in London’s Blackfriars, Marylebone, Ealing and Richmond, as well as Basingstoke, Reading, Windsor and Wokingham.
has 700 units across the capital. Marlin’s managing director Susan Cully says: “It is difficult because we like new-builds, but although we have no firm plans for further development in London, there are still possibilities within this market – never say never.” Go Native’s Nixon also thinks
planning has been a big factor in the capital’s serviced apartment development. Planning restrictions in certain areas of London can prevent some serviced apartment blocks from operating for short stays – often imposing a minimum 30-day stay. To get around this, some apartment operators have to hold hotel licences to be able to offer shorter stays. Nixon points out: “In Asia there is no distinction, which makes it easier for operators out there to be more flexible.” London’s stock is often clustered
around certain areas. According to Nixon, there are more serviced
Planning restrictions in London can prevent serviced apartment blocks from operating for short stays
apartments in Canary Wharf than there are hotel rooms, but SACO’s Redman believes this may change. “We might see a reduction in supply in Canary Wharf in the next 12 months – there is potentially an oversupply of apartments there, whereas in the City there isn’t enough because it’s harder to bring on new stock.”
GOING GLOBAL While the UK and Ireland have seen growth and expansion for many operators, what is the global outlook for the sector? Stuart Winstone is business partnerships director at Silverdoor. He says: “We expect 2013 to be much more settled and anticipate further growth, as a result of both corporates trying to reduce hotel spend and the worldwide increase in serviced apartment stock.” Bridgestreet also reports that its
biggest growth has been through its global solutions centre, where global bookings tripled in demand year-on-year from 2011 to 2012. Bridgestreet’s Layton says this is because “programmes are expanding worldwide and buyers are adding new locations.”
MARCH/APRIL 2013
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