Serviced Apartment News editor George Sell looks at 10 industry players who will make the serviced apartment sector headlines in 2015.
Roman Bach, 9flats.com
Bach, co-founder of peer-to-peer rentals website 9flats.com is on a mission to add serviced apartment inventory to his company's offer. Focused on the European traveller and on the intercontinental guest coming to Europe, the site offers accommodation in 153,000 locations and counting. Its recent innovations include insurance for host, child discounts and payment on arrival, "a feature which is especially useful for leisure travellers. They simply book with us, paying only a small reservation fee and pay the trip when they arrive at their destination" says Bach. He adds: "We can fill the gap for serviced apartments and thus optimise the yield management, especially for weekends."
Cody Bradshaw, Starwood Capital Group
Starwood Capital is one of the most active and dynamic investors in the hospitality sector. In the UK, in the last year alone it has bought the Four Pillars and De Vere Venues portfolios, acquired the Roxburghe hotel in Edinburgh, and revealed plans to revamp Manchester's Palace Hotel. In the US, Starwood already owns the InTown Suites extended stay brand and in June 2014 acquired an extended stay portfolio through the acquisition of TMI Hospitality. As one of the company's main tenets is to invest when new supply is low, we fully expect Starwood Capital to make its debut in the London serviced apartment sector sooner rather than later given the capital's relative undersupply of units.
Steve Brown, Furnished Quarters
As boss of one of the biggest providers of corporate short lets for the US market, Furnished Quarters CEO Steve Brown is behind the launch of the company's new apart-hotel brand Q&A. Debuting in spring this year with its first units in the iconic 70 Pine development in Manhattan's Financial District, Q&A "pays homage to creativity, innovation, and providing solutions for today's business traveller". Brown says: "In a fast-changing world, you need to be creative to be relevant. And that's just what we are doing with Q&A - providing short-stay live-work suites within our hotel that feel like home and are available for shorter stays than traditional corporate apartments."
Paul Constantinou, Quest Serviced
The last few months of 2014 were huge for Quest, with Constantinou and his colleagues laying the foundations for an even bigger 2015. Against a background of regular new property openings across Australasia, Quest signed a massive deal with Ascott, through which the Singaporean giant expects to invest up to AUS$500 million to acquire new properties that Quest will secure for its franchise in Australia over the next five years. Ascott will have a right of first refusal to acquire the properties sourced by Quest. Quest will then provide a lease for the properties, which will be operated under franchises using the Quest brand. In addition, Ascott has signed an agreement to acquire a 20 per cent stake in Quest for AUS$28.8 million, with the option to increase its stake in Quest to 30 per cent. Quest has also been appointed as the primary partner in its region for The Apartment Service and formed an advisory board, bringing in business knowledge from outside the sector.
Lee Chee Koon, The Ascott Limited
Having marked its 30th anniversary in 2014 with an impressive year of growth, The Ascott Limited, under the guidance of CEO Lee Chee Koon, shows no sign of slowing down. In fact he has upped the ante when it comes to the number of units under management, saying: "Growing organically, every year we can add about 4,000. By 2020, we should be able to hit 60,000. But I'm setting a slightly more ambitious target for the team. I hope to be able to make it to 80,000 apartments. We need to work with strategic alliances. There are certain new markets we are exploring in the US and Africa, and even doing more in India. Some you may not be able to do it all alone. If you can find strong partners to work with, developers with certain types of hospitality assets that we can manage or part-invest, this will be a much faster way for us to grow." To aid the growth, Ascott has signed alliances with Quest in Australia, and with Chinese developers such as Yuexiu Property and Vanke China. The latter has helped Ascott reach an impressive 12,000 units in China and it is showing no signs of slowing down.
Susan Cully, Marlin Apartments
London serviced apartment operator Marlin is unusual in developing and owning the properties it manages. 2015 is shaping up top be a big year for the company, which has recently put several new initiatives in place to ensure it enters this year in a strong position to offer guests a good service. A new concierge service and the UK's fastest broadband service (1GB or 1,000Mbps) are among its latest additions. The jewel in Marlin's crown is to be a new-build 281-unit apart-hotel on London's Westminster Bridge Road, which has been granted planning permission. "The development on Westminster Bridge Road is a very exciting proposition for Marlin Apartments as it allows us to diversify our offering to both the corporate and leisure travel markets. By adopting the apart-hotel business model for the first time, we can offer guests a more compact offering but with the same high level of design, facilities, style, customer service and value as we already offer across Marlin Apartments' six other sites," said Cully.
Ziad El Chaar, DAMAC Properties
At the forefront of the vibrant serviced residence market in the UAE is Dubai's DAMAC Properties. Under the leadership of Ziad El Chaar, the company is proving to be a versatile and innovative player despite its relatively recent entry to the market. Recent innovations have included Sharia-compliant developments with separate facilities for men and women and development funds supplied by an Islamic bank; the launch of two separate management companies - Naia and DAMAC Maison; and a deal with Paramount Hotels and Resorts to open serviced residences in Dubai, Abu Dhabi, Jeddah and Istanbul. The launch of Naia shows the ambition and scale of the company's growth plans. It will be targeted at "a younger, trendier clientele" than the DAMAC Maison brand said El Chaar: "We are launching Naia really out of necessity. The scale of this operation is very large with an ultimate total of 10,000 keys, 50 per cent of which are likely to be rented out by owners through our rental pools. We believe that we need a coefficient of two employees per hotel apartment. The two brands will be run by separate teams."
Ho Kwon Ping, Banyan Tree
Luxury hotel and resort developer Banyan Tree has made its move in to the serviced residence sector with the 2014 launch of the Cassia brand. In 2015 the company will develop five properties under the new brand - in Phuket in Thailand, Bintan in Indonesia, Beruwala in Sri Lanka, the Gold Coast in Australia, and Lijiang in China. Each property will have an average development cost of $50 million, and will have about 200 fully furnished units managed by Banyan Tree. Owners who buy the units for investment have the option of staying there for 30 days in a year, with blackout periods during which the units will be leased out. Those preferring to hold the unit as a holiday home will have it for up to 90 days of complimentary use, with no blackout periods. Banyan Tree Group executive chairman Ho Kwon Ping said: The rest of the hospitality sector has seen a lot of excitement and innovation, and even cheaper, smaller, three-star hotels can be hip. But serviced apartments are an under-innovated sector. So we are signalling our entry into this sector, and we intend to shake it up."
Simon Scott, CL Serviced Apartments
One of the most eagerly anticipated new entrants to the serviced apartment sector is CL Serviced Apartments. Heavily backed by US investment manager Oaktree Capital - to the tune of a reported £300 million - the company is set to make a big splash in 2015 when it unveils its plans and first developments. Working alongside CEO Max Thorne, Scott - who joined from student housing provider Watkins Jones and has previously worked at Savills - will identify projects and bring them to fruition in his role as chief development officer. CLSA have got the major players in the sector looking over their collective shoulder and it will be interesting to see how Scott and Thorne go about establishing themselves as the latest of those major players.
Steve Thorne, Flying Butler
Thorne has recently been appointed as managing director of Deep Blue Apartments' Flying Butler brand, and there can be few figures in the UK serviced apartment sector with more experience than Thorne. He has worked for Oakwood Worldwide, City Apartments Ltd, Staybridge Suites and The Ascott, and was most recently sales and marketing director at Grosvenor House Apartments by Jumeirah Living. Tasked with delivering a well funded growth strategy, Thorne will spearhead the company's growth in Greater London and the Home Counties, saying: "I am thrilled to become part of the Deep Blue story. As one of the more mature operators, the combination of stability and experience together with exciting expansion plans is very attractive to me. I'm looking forward to bringing my experience and knowledge to help take the company to the next stage."