Staying Power

Serviced apartments are expanding options – and value – for business travelers

- Harvey Chipkin & Marisa Cannon

Two things we know about serviced apartments. One, it’s a growing industry segment numerically and geographically; and two, it’s gaining a wider acceptance among business travelers.

According to the latest Global Serviced Apartments Industry Report 2016/17, prepared by the TAS Alliance, a collection of operators and vendors, 88 percent of companies now used apartments for “one business reason or another.”

The report found there are now over 800,000 units in the sector – which may fly the flag of serviced apartments, apart hotels, corporate housing and other appellations. That’s an increase since the last GSAIR report of 10.5 percent worldwide. In the US, according to the report, the sector’s revenues were $2.93 billion in 2015, a 7 percent increase over 2014.

The report shows that about two thirds of corporations use serviced apartments for business travel. The reason: Long-term housing is simply the most productive choice for a variety of business travel needs – most commonly relocations, project work and training. As a consequence, the average corporate housing stay in the US was 84 nights in 2015.

The reasons for booking long-term serviced apartment stays differ geographically, according to the GSAIR. In Europe, just under half of stays were for project work, and a third for relocation, while in the US, relocation was the most frequent reason to stay in corporate housing, followed by interns.

Several positive trends are emerging in the sector: The increasing ease and flexibility of booking and using long-term housing, plus enhancements to safety and security, and the possibility of substantial cost savings.