WHAT IS IT WITH SERVICED APARTMENTS?

Talk about alternative accommodation, and everyone thinks you’re referring to Airbnb. While it’s true that the use of disruptive providers – like Airbnb – is rocketing in leisure travel, business travel buyers are yet to wholeheartedly embrace them. The serviced apartment industry, however, is flourishing and we have the stats to prove it.

For the last three years, the Business Travel Show has collaborated with ASAP (the Association of Serviced Apartment Providers) to poll buyers. This year, our survey shows that nearly a third of corporate travel buyers increased their use of serviced apartments in 2018.

This is a huge leap from the 20 per cent who turned to serviced apartments more often in 2017. In addition, it was the only accommodation category to see an increase in use over the last 12 months.

Thirty-five per cent of the 134 respondents said they had used the same amount of serviced apartments as they did in 2017 – up from 25 per cent in the previous year’s survey.

When asked why they chose to book serviced apartments, the number one reason given by buyers was “better value for money”, followed by convenience of the self-catering option, more space, flexibility to experience the location like a local resident and long-term suitability.

Kat Hendry, Business Travel Show account manager, below

Buyers are also allocating a higher proportion of their budget to serviced apartments; 77 per cent spent less than 10 per cent of their budget on the accommodation option – down from 90 per cent in 2016. Meanwhile, 17 per cent allocated 11-25 per cent, compared to just 7 per cent in 2016.

For the first time in the survey’s history, a small number of buyers said they allocated 51-100 per cent of their budget to serviced apartments, with 1 per cent claiming to spend their entire accommodation budget on this option.

The number of buyers who didn’t use serviced apartments dropped from 42 per cent in 2017 to 32 per cent in 2018, whereas the proportion not using sharing economy accommodation options such as Airbnb rose from 38 per cent to 45 per cent. Furthermore, the number that haven’t used five-star hotels also went up slightly from 28 per cent to 31 per cent.

These are pretty extraordinary statistics that prove the industry is making considerable headway in raising awareness of serviced apartments as valid and valuable alternative accommodation for business travellers. Not only are more buyers aware of serviced apartments as an option, they also appreciate the pros they offer to their travellers and are much more open to including them in their travel programmes.

They also reflect the ongoing pressure on buyers to cut cost and display improved ROI on travel spend as well as the desire from younger travellers to enjoy the flexibility provided by alternative accommodation providers.

We asked ASAP’s CEO James Foice what he thought of the results. He pointed out how the landscape is rapidly evolving for the serviced apartment sector and how ASAP is also seeing a significant increase in supply year on year. In 2018, he said, they found that more and more companies are booking two-bedroom or two-bathroom apartments, as colleagues will often share the apartment, making it a more cost-effective choice as well as giving employees working away from home some companionship. A two-bedroom option also provides privacy and collaboration space under one roof.

We host the ASAP Pavilion at Business Travel Show, so if it’s a sector you are yet to investigate, come and meet a few them in February.

This post was written by Business Travel Show account manager Kat Hendry -kat.hendry@centaurmedia.com @kathendrybts. The Business Travel Show is the leading event for corporate travel in Europe attracting over 9,000 professionals and 260 exhibitors. Taking place from 20-21 February 2019 at Olympia London, the show is celebrating its 25^th anniversary.

GUEST BLOG: Why hotels might not be the best option for that longer stay

When you are going to stay in a new city, whether it is for business or for leisure the default option is often to look at which hotel in that city is best; however is a hotel really the best option? We take a look at what other options you have and why they might suit your needs better.

The reason why many of us choose to stay in hotels rather than the other accommodation options is habit plus you can be sure of what you will get when you go and stay.  Hotels will often have some kind of restaurant and bar, many will have gyms and as you go higher up the star rating, you will also start to get facilities such as business lounges, spas and pools. 

When you are only staying for a few nights, this can be the best option as you really don’t have to think about anything – it is all within the confines of the hotel.  But when you stay for more than a few weeks in a hotel, one room can start to feel a bit claustrophobic, especially when the room is not very big.  So what is the alternative?

Suites

Most hotels towards the more expensive end of the market will have a small proportion of suites as part of their room stock.  A junior suite on average will be double the price of a standard room yet the only difference is that it will have a seating area with a comfy sofa. Large suites may have a more clearly differentiated living/seating area and occasionally may even have separate rooms, but these options will be significantly more expensive than standard rooms. 

The issue with most hotel suites apart from the much higher nightly price is that they often do not contain any form of kitchen and you pay on a nightly basis rather than a weekly or monthly basis.  If you are staying for three months, paying a nightly rate can be much more expensive.

Apart-hotels/Suite Hotels

In the UK and to some extent in Western Europe these are a relative new concept and as the name suggest sit somewhere between hotels and apartments.  Within Apart-hotels you will often find on-site facilities such as restaurants/bars, laundry rooms and concierge services.  The only differences between this and a conventional hotel is that rather than maybe 5% of the room stock being suites, 100% of the stock is,  plus in apart-hotels most rooms will be similar to a junior suite and effectively it will be a rather small studio apartment.

It is almost certainly contain a small kitchenette which can be used for preparing basic meals but this is not a place you would want to be throwing dinner parties in.  With these properties you may well find that they will have a different pricing structure for longer staying guest than those who will only stay for a few nights.

Apartments

These are what most people rent as homes when they can’t afford or don’t wish to buy property.  Apartments are a whole property category within real estate and can range anywhere from a studio up to five or six bedrooms.

As with holiday apartments, standard apartments are often popular for two reasons:

1) You are staying in one place for a longer period of time (more than a month),

2) You want the freedom to cook for yourself and live the way you want to. 

Although you might stay in an apartment whilst on holiday (especially if you have a young family), you will normally pay for this either on a weekly or monthly basis.  This can be especially advantageous if you are not going to be taking any advantage of hotel facilities. 

Whether you are staying in a studio or a 2+ bedroom apartment, they will always have a fully fitted kitchen. Unsurprisingly like with any home, a standard apartment has one major disadvantage for busy people – you have to do all the cleaning and maintenance yourself.

Serviced Apartments

Serviced apartments actually are a great middle ground.  On average they will give around 30% more space than a standard hotel room of the same class.  Whether you stay in a studio or a 2+ bedroom apartment they will usually of a hotel quality finish designed by those from the repetitive hotel world culture.  They offer separate fitted kitchens, reasonably high quality bed linen, towels and toiletries and first-class home entertainment facilities – Sky TV based on hotel models, DVD, CD and the very latest in-room technology. 

Unlike suites or standard hotel rooms, a serviced apartment will prove to be more cost-effective especially once you stay more than 2 weeks.  You will also enjoy much greater flexibility choosing for yourself whether you eat in or out, plus you can also entertain friends and colleagues as if you were in your own apartment.  A disadvantage to most serviced apartments currently available is that they tend to be a bit boxy optimising to revenue rather than space.

On top of the advantages of the apartments themselves, just like in a hotel, your apartment will be regularly cleaned and serviced (usually twice a week for long stay guests), this means that the towels, bedding, soap etc. will be replenished on a regular basis.  When you think about it this is a perfect solution.  You get a stunning apartment yet all the hard work in keeping it stunning is done for you, leaving you the time to relax or entertain the way you want to.

One last advantage, is that most serviced apartment blocks tend to have a maximum of 30-50 apartments.  This means that within the one block you are looking at only 100-150 people living there at any one time.  This will in itself will make it feel a much more homely and friendly place to live.

Serviced Residences

Serviced residences are serviced apartments however they have been designed with a focus on the long stay 90+ day market.  This means four things:

1)       The finish has taken inspiration from bespoke interior design for living well and personal    service.

2)       Large spacious rooms where natural light and the comfort of the resident are equally if     not more important than revenue optimisation.

3)       Much higher quality finish in the equipment and technology installed- including top of the range kitchen and shower fittings. (E.g. each apartment will have a fully independent Sky TV system rather than a managed one). The furniture that is placed in these apartments is often unique pieces and certainly designed to last many years. 

4)       Much better value where by it can equate to a standard 5 star room rather than suite at a hotel.

The idea of serviced residences harks back to the 1920s and 1930s when people looked to stay in mansion blocks with a friendly concierge who would welcome you and give you a very high level of personal service.  In fact it was fairly common for people to actually be resident in hotels during that era, something which has fallen out of favour today.

Unlike other serviced apartments which can be located in any district, serviced residences tend to be located in quieter districts of cities.  However in the UK very few organisations provide this type of accommodation with many preferring the standard serviced apartment model.

In effect, selecting a serviced residents for a long-stay visit gives you all the benefits of living in your own home but none of the downsides like decorating and cleaning.  On top of this with many serviced residence you get to experience an upgraded more luxurious home from home stay.  It may be so good you will think again about renting a standard non-serviced apartment.

This was written by The Harrington Collection, who are exhibiting at The Business Travel Show on Stand B2630 - secure your free pass now by visiting http://www.businesstravelshow.com/register 

FOUR OUT OF TEN BUYERS WILL HAVE BIGGER TRAVEL BUDGETS IN 2018

Four out of ten buyers (40 per cent) will have bigger corporate travel budgets in 2018, compared to 32 per cent 12 months ago. Half of buyers (49 per cent) claim they will also have more to spend on air travel and accommodation. However, 45 per cent expect to have more trips to manage next year and 47 per cent expect total travel costs to rise.

This is according to research carried out by Business Travel Show, which was answered by 243 buyers. Business Travel Show is Europe’s leading event for corporate travel professionals and takes place at Olympia London from 21-22 February 2018. Buyers can register for free at www.businesstravelshow.com/register

The poll revealed (please read on for full table of results):

• A huge leap in buyers with increased accommodation spend – 49 per cent compared to 32 per cent yoy
• Half of buyers with bigger airline budgets – 49 per cent compared to 40 per cent yoy
• Just 15 per cent of buyers will have fewer trips to manage
• Almost half of buyers (47 per cent) expect travel costs to increase

Carrie Nederpel, travel specialist in the Netherlands and Business Travel Show advisory board member, said: “From what I have noticed here in the Netherlands, business is booming and, along with that, travel. The need and financial ability for corporate travel is increasing, as are the budgets to do so.  The challenge for a travel buyer is how to spend our increase in money wisely and ‘shop around’, as it were. For me, the Business Travel Show is the perfect venue to do this.”

A senior corporate travel manager added: “From my point of view, the growth of corporate travel budgets is in line with company growth and the increase in number of required trips and not necessarily an increase in travel costs.”

David Chapple, Business TravelShow event director, added: “This time last year, geopolitical events such as Brexit and the imminent inauguration of President Trump left many concerned for the economy and the widespread feeling of uncertainty about what the future holds undoubtedly leaked in to the corporate travel market. 

“The results of our survey, however, indicate that caution in business travel was short-lived and budgets and growth appear to be healthier than ever. In fact, some commentators have even suggested corporate travel may do better than other industries, as companies invest more in travel to explore alternative trade avenues outside of Europe following the Brexit vote.”

How budgets will compare between 2017 and 2018 including historical research data:

	18 vs 17	17 vs 16	16 v 15	’15 v ‘14	14 v 13	13 v 12	12 v 11
Budgets
Bigger	40%	32%	29%	32%	37%	39%	39%
Smaller	12%	21%
The same	48%	47%
Travel costs
Increase	47%
Decrease	13%
The same	40%
Number of trips managed
More	45%	48%	44%	45%	48%	57%
Fewer	15%	37%	37%	41%	31%	22%
The same	40%	15%	19%	14%	22%	22%
Airline budgets
Bigger	49%	40%	33%	33%	39%
Smaller	11%	15%	24%	21%	37%
The same	40%	45%	43%	46%	24%
Accommodation budgets
Bigger	49%	32%	38%	30%	30%
Smaller	24%	14%	21%	27%	43%
The same	31%	54%	41%	43%
Will you book more room nights?
Yes – more	45%
No	24%
Don’t know	31%

Online visitor registration is now open for the Business Travel Show at http://www.businesstravelshow.com/visit/register