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MAY 2013 |www.opp-connect.com WORDS |Maneesha Chawla


n what seems to be a rush to get their product to the market fi rst, big developers and the large hotel names that they represent are being very hush-hush about their serviced residences and what they will have on offer. A move we are chalking up to some serious competition. OPP had an informal chat with one of the heads of sales and development for Hyatt India, who preferred to remain anonymous due to hotel protocol, and we found out more about serviced residences and their growing popularity in India. Unfortunately we were unable to get in touch with any of the other large players in the country despite repeated attempts... leaving us wondering what all the cloak and dagger antics were about. First off the bat, what is the


difference between a ‘serviced


India’s Secret Service I


residence’ and a ‘serviced apartment’? Generally speaking a serviced apartment is a long-term alternative to a hotel and is generally run by a hospitality company. On the other hand, a serviced residence is a unit that is sold to an individual. The individual owns the unit and some hotel-style services are provided by the hotel to owners or occupants of the serviced residence. Services tend to be on a pay-per-use basis, but do not include the turn down services that a hotel would offer. In essence, a serviced residence gives a homeowner the best of both worlds by letting them own a luxury branded home and adding that little bit extra by providing services that are provided at a luxury hotel, such as room service, facilities management and concierge services to name a few. A serviced residence is usually part of hotel complex but may not be physically attached to the hotel. The footprint can vary from anywhere between 1200 square feet to 7500 square feet depending on the


location and what else is on offer. The NCR is eagerly awaiting the launch of the Four Seasons new serviced residences in Noida. Apartments are a sprawling 7500 square feet in size and promise to be the fi nal word in luxury. Other than The Four Seasons and The Leela, The Hyatt seems to be the only other big player on the market, leading the way in providing serviced residences for individuals. Our contact said that the general consensus has been


“Perfectly suited to the high-end player that wants a certain lifestyle and is willing to pay for it”


that purchase of such homes has been primarily for personal use. The product is perfectly suited to the high-end player that wants a certain lifestyle and is willing to pay for it.


The head of sales and marketing


that we spoke with felt that there were certain key factors that make a successful serviced residence work. As is always the case for any real estate product it often boils down to location, location, location! “Tier 2 cities in India are just simply not viable for such a product,” said our contact. He said that affl uent and savvy investors are the key demographic and these tend to be found in Tier 1 cities. A mature and relevant market is key, a major reason both The Hyatt and The Four Seasons are launching in the NCR. The Leela’s serviced residences in Noida, built by Supertech, will have both a hotel and apartments on site. According to news sources, the companies have entered into a 30-year contract together to run both the hotel and provide services to the residences attached. Vivek Nair, chairman of Hotel Leela Venture Ltd told the Mint in India last year that the Leela Residences are, “A new


Keep it quiet | Luxury homes with luxury services – Indian style


concept we are introducing in India, where we will


OPP EDITOR


INDIA | 35


In India, hotel chains and developers are joining forces to fi l a gap in the market: the ‘serviced residence’ is born. So what’s strange about that? Gaps are there to be fi lled and there is profi t in fi lling them. It’s just that nobody seems to want to talk about their plans. Our editor in India, Maneesha Chawla, investigates...


sell the luxury apartments to families, which will then be able to avail of Leela hotel services including housekeeping. It has gained popularity in the US and Europe and we expect the same response from India”. Other than their project in Noida, The Leela also has two serviced residence projects in the pipeline in Bangalore as well. Another thing about serviced apartments, said our source, is that the interiors are of a certain quality and have the look and feel of the hotel that has provided their stamp to the project. It’s interesting to note that each brand has their own look and feel – it is well worth shopping around and having a look at what is on offer both in terms of amenities and style before taking the plunge. The key thing to remember about a


serviced residence is that the product is built and sold by a developer. The hotel brand merely lends itself to the product. They provide some of the hotel services to residents and residents often have access to hotel amenities. To get our numbers we had to make a few calls posing as potential clients, which left us wondering just why everything was being kept so hushed up? The Hyatt’s current offering in Gurgaon is called the Grand Residences and is in conjunction with Ireo developers. Homes are roughly 4500 square feet and sell at just under Rs 27,000 per square foot, homes ring in at around the 13 crore mark. The Four Seasons have 7500 square foot apartments in Noida developed by 3C and ring in at around Rs 23 crore per apartment. While these are clearly homes at the higher end of the spectrum, they are to some extent on par with other high-end offerings. Investors are likely to look at these products because of the branding and the extra services that are included. Hotel chains stick to doing what


they do best and provide the services. They let the developers do what they do best: develop and sell the products. It seems that the hotels and developers are onto a winning formula and in a climate where the luxury segment is in high demand we can expect to see many more high end hotel branded serviced residences being developed in Tier 1 cities across the country.


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