That’s the view of a number of key investment industry figures who believe the sector will fully establish itself in the British property market over the next 12 months as more and more people get used to the term and start using them in the place of traditional hotels.
A recent report from Savills and the Association of Serviced Apartment Providers (ASAP) found that national operators are set to increase their number of accommodation units by as much as 122.3% between 2016 and 2017, with the sector as a whole set to grow by 8.4%.
“The service apartment industry is on the cusp of big things, with an exciting future ahead,” according to Mark Harris of the Travel Intelligence Network. He cited the unrelenting appetite for corporate accommodation as the key driver of this growth, with UK businesses registering an 86% increase in the use of serviced apartments in recent years.
The emergence of serviced apartment use in regional cities up and down the country has excited many in the industry. “Without doubt, this expansion all across the UK is an exciting milestone for the industry. It’s fantastic to see openings in 2016 in secondary cities like York and Reading, as well as continuing growth in primary cities such as London and Birmingham,” declared John Wagner, Director of Cycas Hospitality. The spillover to regional centres in Scotland.
Demand from companies wanting short-term accommodation – particularly serviced apartments – for overseas assignees has soared in recent years and shows no sign of abating, according Knight Frank’s 2016 Global Cities report.
Over the past seven years, the report says, the number of serviced apartments has grown by 80 per cent.
Brick-Sand-Mortar did exactly that. We acquired a run-down building on the outskirts of Glasgow in the conservation village of Eaglesham, fully refurbished it with a view to running serviced apartments and had a stunning success with return on capital as revenue has exceeded our best predictions.
Tom Bill, head of London residential research at Knight Frank, comments, “For investors and landlords, there are clear long-term rewards in the world of short-term rental accommodation. Cities that embrace the flexibility of models like serviced apartments will reap the economic rewards.”
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