Serviced Apartments are on the Rise Across the Board According to Reports
The short-term and mid-term housing and accommodation sector is evolving rapidly, and more options are open to travellers, expats and people relocating to different cities than ever before. One area that seems to show growth is the serviced apartment and mid- to long-term fully furnished apartment rental sector. These types of apartments are attractive because they combine some of the properties of regular accommodation, but have many advantages that make them a much better option. Let’s take a closer look at some of the driving factors behind that trend.
What makes serviced apartments so interesting is the fact that they’re furnished pretty much like any hotel room should be. They may also be minimally or fully serviced. Others will offer small perks like regular linen changes and access to either laundry rooms or a personal washer and dryer.
These types of apartments will also have a fully furnished kitchen, which is one of their main differentiators compared to hotel rooms. They also allow more flexibility as far as guests go, which makes them a great option for families and business teams.
Another thing that makes furnished apartments and serviced apartments so popular is the extra space visitors can enjoy when compared to hotel rooms. On average, serviced apartments allow visitors to enjoy much more space than they would for a comparable hotel room for a fraction of the price. They’re also a better option for teams that would like to work in silos when needed or enjoy spaces where they can relax while also being able to work on team projects or hold presentations.
This phenomenon is not just limited to a few markets, but it is worldwide, especially among business and professional travelers. According to Germany’s Business Travel Association, there are more than 6 million people staying in serviced apartments per year in the country. This is roughly 62% of the total apartment/hotel sector in Germany.
Most travelers who decide to go for serviced or fully furnished apartments do so for the price. For instance, a 3-star hotel can cost you around €87 per night. A serviced or furnished apartment, on the other hand, can cost as low as €900 for a whole month. And this is with better interior quality, more space and freedom, and optional amenities that can rival any hotel. Also, according to a recent study, 70% of business people worldwide stated that they spend over 30 days per year on average on business trips, which makes serviced apartments an even better choice.
The UK also saw a major rise in the popularity of serviced apartments. As a matter of fact, serviced apartments had a whopping 81% occupancy rate in the year 2016. They were even able to surpass hotel rooms who had a 77.2% occupancy rate during the same period. This could be a huge turning point in the industry and a sign of things to come. In addition, four out of ten corporate buyers stated that they would be looking to use serviced apartments as an option more than they did in previous years.
The demand for medium and long term furnished apartment rentals is also on the rise in many markets in the US, such as Chicago. Chicago, being a major business center with a high population density and a high demand real estate market, has the conditions needed for serviced and furnished apartments to flourish.
Services like Blueground, for instance, operate hundreds of furnished apartments in Chicago and around the country. They allow people to easily find the furnished apartments in Chicago they need by browsing through their selection online. Most of their units are located near major attractions and cultural centers and make the booking experience as flexible and easy as they can for their customers.
The rise of services like Blueground makes renting a serviced or fully furnished apartment less of a gamble and adds an extra layer of legitimacy that isn’t as prevalent when most people book serviced apartments directly through individuals or brokers.
There is clearly a trend forming around serviced and fully furnished apartments, and observers would be wise to look at this trend when it comes to investment opportunities. The hotel sector also cannot afford to ignore this trend and will need to make some swift changes if they don’t want to continue losing market share.