[photopress:hotels_serviced_apartment.jpg,full,alignright]A personal note. This is being written in a serviced apartment rather than a hotel. The writer much prefers that situation. It comes as no surprise that serviced apartments in China, especially internationally branded ones in gateway cities Beijing and Shanghai, are becoming well established. Serviced residences operated by overseas operators are also emerging in major cities such as Dalian, Tianjin, Guangzhou and Shenzhen.
Importantly, the way they are used is changing. Andreas Flaig, Executive Vice President of Jones Lang LaSalle Hotels in China said, ‘Serviced apartments in China traditionally catered to expatriate residents seeking long-term leases, however, changing market dynamics and an increase in demand for short-term accommodation are nudging them closer to a hotel product.’
He expects serviced apartment development to be reflected in other major cities throughout the country.
Hans Galland, Vice President, Jones Lang LaSalle Hotels in Shanghai said, ‘Serviced apartments offer owners and operators the flexibility to meet an evolving demand profile. With their ability to also cater to short-stay guests, branded serviced apartments are able to leverage their brand and distribution in times of high transient demand.’
Which means, probably, that serviced apartments are becoming more flexible as to length of stay. This is also true in other countries.
Increased demand, better quality supply and an increasingly transparent property market are driving the development of serviced apartments in China. Serviced apartment transactions in 2005 and 2006 demonstrated that there is an active and liquid market for serviced apartments in China’s major cities. International investors, particularly US opportunity funds, and experienced owner-operators make up the bulk of the buyers.
It is an interesting development and may mean, in the future, that the distinction between hotel rooms and serviced apartments blurs so as to have little relevance.