FEATURE SERVICED APARTMENTS
that Oaktree Capital Management and SACO had joined forces to launch the Beyonder aparthotel concept, creating a combined portfolio of over 2,300 units, is the latest in 18 months of intense activity in the serviced apartments world. Relocation and assignment working
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have long been the mainstays of serviced apartment demand, powered by an increasingly mobile global workforce. But transient business travel is finally embracing serviced apartments as a viable alternative to hotels. According to Bridgestreet, 75 per cent
of corporate travel policies now include serviced apartments, with 44 per cent recommending apartments for stays of up to four nights, rising to 76 per cent for stays of more than a week. More flexible travel policies are also giving travellers greater independence in decision making, but is this the full story?
Back to basics ‘Serviced apartment’ is the umbrella term used to describe a wide range of non- hotel accommodation products that are fully-furnished, self-contained and equipped with a kitchen or kitchenette. The Apartment Service’s latest Global Serviced Apartment Industry Report (GSAIR) estimates there are now 748,437 serviced apartments worldwide – up 14 per cent in the last 18 months, and over 80 per cent in just seven years. At one end of the serviced apartment spectrum lies the aparthotel (known as extended stay hotels in the US), with
ou can tell when a market is doing well because the suppliers start buying each other. March’s announcement
varying configurations of equipment, features and amenities but (typically) no minimum period of stay restrictions. At the opposite end lies corporate housing; fully furnished residential properties (found mainly in the US) with added services such as cleaning. The fact that corporate housing is frequently referred to as serviced apartments outside of the US causes some confusion. Rebecca Hollants Van Loocke of The
“Travellers are looking for larger rooms and apartments with amenities that are more suitable for long-term stays”
Ascott Limited points to confusion over definition as the reason why a star rating system has not yet been applied to serviced apartments. “In my opinion, a serviced apartment needs to be just that; an apartment which contains a kitchen and sleeping area, with a reception desk for around-the-clock assistance for any issues a guest may have. It should be safe and secure and offer the flexibility and freedom of a home-from-home environment.” But is it really a problem that the serviced apartments sector has struggled to get to grips with self-definition? George Westwell, director of Cheval Apartments believes it is. “We need clear definitions to help explain the opportunities and diversity in our sector so we can speak with one voice to corporate buyers.”
Marlin Apartments’ managing director, Susan Cully, agrees. “How the industry defines serviced apartments is crucial to the wider understanding of our product. Perception among corporate or leisure travellers dictates how the product needs to be marketed by the operator – so the two are intrinsically linked. If two guests’ basic definitions of serviced apartments differ, then we as an industry fail.” The importance of distinguishing
different product types under the generic ‘serviced apartments’ umbrella is highlighted by Skyline’s Thiago Hahn. “We sit under corporate housing because our typical length of stay is 30 to 60 nights and longer. We do short stays but it’s a different concept in the same way what aparthotels are totally geared towards stays of up to four or five nights,” says Hahn. In contrast, the chairman of the
Association of Serviced Apartment Providers (ASAP) doesn’t believe definitions matter. “The important thing is for customers to be able to see what the offering is,” says Don James. “Searching is much more personalised now, so operators must provide enough information to make the right choice.” Ben Harper at SACO, meanwhile,
believes the problem is gradually receding. “A clear distinction is emerging between aparthotels and traditional serviced apartments. Corporates need clarity because they need to manage their travellers’ expectations. The aparthotel concept provides that clarity because it enables operators like us to create brands and products that feel the same regardless of location, with consistent minimum standards.”
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THE BUSINESS TRAVEL MAGAZINE 67
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