How has the market for serviced apartments developed after Corona, and when is an investment interesting? Matthias Rinc\u00f3n, managing partner of the operator ipartment, draws conclusions.<\/p>\n\n\n\n
Serviced apartments are a special form of micro-living. As temporary apartments with hotel-like services, they have developed into a diverse offering that appeals to a wide range of users, from \u201ayoung professionals\u2018 to project workers, business travelers or interim managers. Like hotels, serviced apartments are considered commercial real estate, but allow stays of up to 6 months. In asset management, serviced apartments are often used to diversify and increase returns in residential portfolios. Alternatively, they are managed as special AIFs for institutional investors, such as the ProReal Cape Town Ring project by the One Group from Hamburg. Yields of between approximately 4-7 % can be achieved with the asset. Lease or management agreements are used to operate the property.<\/p>\n\n\n\n
After the Corona crisis, occupancy rates for serviced apartment buildings again increased significantly in 2022. According to a survey by Apartmentservice, providers reached not only the required minimum occupancy of 75 to 80 last year %, but sometimes even significantly higher levels. Ipartment, for example, recorded a full occupancy of 93 with a total % booking rate, which is higher than the pre-Corona level of 90 %. The demand for temporary housing in specialized homes for their users is therefore still high. Unlike hotels, serviced apartments are indeed a niche product (4.9% % of the hotel market \/ Market Report Apartmentservice 2022), but they proved to be very resilient and flexible in cost management during the Corona period.<\/p>\n\n\n\n
Despite some significant declines, the properties recovered as soon as the political measures were lifted. During the crisis period, adjustments could be made directly: through pricing, more digital tools and additional target groups, although the losses could only be partially compensated. Operators with investor participation were at an advantage in terms of liquidity and market position. Today, the renewed high revenues of many operators show that the asset serviced apartment is continuing to establish itself after the major test of time.<\/p>\n\n\n\n
According to current figures from Apartmentservice, at the end of 2022 there are just under 45,000 serviced apartments in 800 buildings in Germany. Despite the economically challenging situation, a total of 80,000 to 85,000 units are expected to be built by 2030. The growth trajectory of the segment is now expected to continue at a slightly slower pace with 37 % to 2024, but to remain at a high level. Similarly, the ipartment group, which specializes in serving business clients, has expanded its portfolio with three additional properties in 2023, bringing its total number of properties to 14 with 260 new apartments. An increase in revenue of 18 to 20 percent % is being targeted, and in addition, three additional homes are being planned. Providers such as Habyt and Colonies are also focusing on expansion with their co-living products.<\/p>\n\n\n\n
As operators of serviced apartments, various instruments are available to manage growth in the market, such as pricing, length of stay, new openings, and special services. Depending on the operating concept, for example, more short- or mid-stay offers can be introduced to achieve higher-priced bookings per night. ipartment can integrate up to 25 % short-term stays of 29 nights or less. The two major locations at the Frankfurt am Main airports (177 units) and Berlin-Brandenburg (from 2023 \/ 156 units) as well as Braunschweig (120 units) were selected for this purpose. Despite this, the operating concept allows for keeping booking prices moderate.<\/p>\n\n\n\n
ipartment is located in the mid-price segment with high quality, on the one hand through specialized services for business people, from laundry service and bike rental to breakfast on demand, and on the other through high-quality design features that create a pleasant atmosphere \u2013 a price-performance ratio that certainly contributes to the above-average occupancy rate. In general, serviced apartments score well against hotels or other commercial assets with high planning certainty, a diverse customer base, and relatively low management costs. This allows for flexible operation based on demand. At the same time, serviced apartments as commercial offerings are subject to few regulations such as rental rates or lease expiration dates.<\/p>\n\n\n\n
In order to successfully run a serviced apartment complex, precise market positioning is required. This means that, in addition to a location with excellent infrastructure such as in large cities or in selected B- or sometimes C-class locations, the operating concept is crucial for the success of the properties. Ultimately, the goal is to open up a lucrative niche for one\u2019s own product in a niche market. Some focus on Coliving, community concepts for young professionals, with contact offers and communal spaces.<\/p>\n\n\n\n
ipartment focuses on a high-end business clientele that takes care of itself and values discretion. Others are pushing for exclusively digital rentals with mixed user groups and completely forgo having a reception with on-site staff. At ipartment, too \u2013 even before Corona \u2013 the move to digitize the properties had already begun, relieving the staff and offering autonomous, simple processes for guests. Digitalization will be a \u201emust\u201c for every property in the long run. It is important that there is a coherent hospitality concept behind it, because digitalized processes alone do not guarantee successful operation.<\/p>\n\n\n\n
According to GSAIR 2022 (The Global Apartment Industry Report), surveys have shown that high-speed Wi-Fi ranks first in guest ratings, followed by cooking facilities, 24-hour service, and in-house services. In practice, it is also evident that individual guest service can significantly contribute to the profitability of the properties. For example, an ipartment property in Frankfurt is located in a station area with a challenging environment. Through personal attention, pick-up services, and small city tour guides, the guest service agent managed to increase the booking rate by 20 % % within half a year and maintain it at a high level. Strong customer retention is also evident in the fact that approximately 80% % of bookings come through the company\u2019s own website. Therefore, a location-specific hospitality concept is essential to ensure stable occupancy.<\/p>\n\n\n\n
Serviced Apartments stand as an asset on three key pillars: good location, exceptional facilities and the operating concept. Occupancy is largely predictable and ensures long-term success. There are a variety of interesting and profitable operating concepts available on the market, with different strengths and weaknesses. Ultimately, it is up to the operator to set up the operating concept and manage the performance of their properties.<\/p>\n\n\n\n
Guest contribution by Matthias Rinc\u00f3n, managing partner of IPARTMENT GMBH<\/em><\/p>","protected":false},"excerpt":{"rendered":" Wie entwickelt sich der Markt f\u00fcr Serviced Apartments nach Corona und wann ist ein Investment interessant? Matthias Rinc\u00f3n, gesch\u00e4ftsf\u00fchrender Gesellschafter des Betreibers ipartment, zieht Res\u00fcmee. Serviced Apartments sind eine Spezialform des Micro-Living. Als tempor\u00e4r genutzte Apartments mit hotel\u00e4hnlichen Services haben sie sich zu einem breit gef\u00e4cherten Angebot entwickelt, das ganz unterschiedliche Nutzergruppen anspricht, von den […]<\/p>\n","protected":false},"author":2,"featured_media":1073,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10],"tags":[],"class_list":["post-1084","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-presse"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/posts\/1084","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/comments?post=1084"}],"version-history":[{"count":2,"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/posts\/1084\/revisions"}],"predecessor-version":[{"id":1499,"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/posts\/1084\/revisions\/1499"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/media\/1073"}],"wp:attachment":[{"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/media?parent=1084"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/categories?post=1084"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ipartment.de\/en\/wp-json\/wp\/v2\/tags?post=1084"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}