Making connections at Serviced Apartment Summit Europe

George Sell George Sell Uploaded 18 July 2017


Around 300 industry figures from across Europe and beyond gathered in London last week for the 2017 Serviced Apartment Summit Europe.

The first day of the event saw delegates tour Cheval Three Quays and Leman Locke, the latter then hosting a speed business card swap and drinks reception. For the first time this year, delegates had the use of a networking app, which as well as hosting event information, allowed them to view each others profiles and arrange meetings - an amazing 325 meetings were arranged at the Summit using the app, a great way to bring the industry together.

July 13th saw a full day's conference, which kicked off with host Piers Brown announcing an exciting new event - Serviced Apartment Summit Europe Recharge, which will take place at Zoku Amsterdam on January 23 and 24 2018. Brown also announced the date of the 2018 Serviced Apartment Awards - March 19.

Keynote speaker Trevor Williams, chief economist at TW Consultancy, then gave delegates a view of the broader economic situation in the UK and beyond, citing the uncertainty around Brexit, static or declining GDP, high employment but falling wages, and inflation, as influencing factors on economic activity and any possible rise in interest rates.

George Titlow of STR shared some insights in to how the international and UK serviced apartment sectors are performing. For the 12 months to May 2017, the UK has the highest global ADR and REVPAR figures at $178 and $138 respectively, while the UAE (86 per cent) and Australia (79 per cent) have the highest average occupancy rates. The UK has seen the highest REVPAR growth in the same period (6.5 per cent), while the UAE has seen a 3.5 per cent drop, largely due to an abundance of new inventory.

The UK sector is looking healthy with rises in occupancy (up 1.9 per cent to 78 per cent), ADR (up 4.5 per cent to £137) and REVPAR (up 6.5 per cent to £107). London is the best performing UK market, with occupancy of 80 per cent, ADR of £181) and REVPAR of £145.

Regional UK performance was described as relatively flat, but there are encouraging signs given supply increases. Outside London, Edinburgh was a star performer, with a 16 per cent increase in REVPAR, compared with a six per cent drop in Manchester, a four per cent drop in Aberdeen and a two per cent drop in last year's star performer, Birmingham.

Titlow predicted a strong year ahead for Amsterdam, Barcelona, Dublin and Madrid; a solid year for Prague, Athens, Rome and Munich; and a bumpy ride for London, Edinburgh, Manchester and Frankfurt, all of which have seen significant new supply enter the market.

Nicole Perreten of HVS then gave a presentation called Serviced Apartment market Opportunities. Among her observations were the trend for micro apartments, such as BridgeStreet's Studyo and Stow Away brands, and Ascott's Lyf; and rethinking common areas, as seen in SACO's Locke and Accor's Adagio brands.

In a breakdown of apartment type across Europe, Perreten said that 59 per cent of units are studios, 34 per cent one-bedroom units, six per cent two-bedroom units and less than one per cent three or more bedrooms. More than half of European serviced apartment guests stay for less than 10 nights, with four to nine nights being the most popular length of stay.

A comparison of the European extended stay pipeline revealed that Marriott's Residence Inn is the fastest growing brand, and is on course to go from less than 600 units in 2017 to more than 1200 by 2019.

There followed a session on finance and investment, before a panel of CEOs gathered to discuss the findings of the Serviced Apartment News European industry sentiment survey, the results of which can be seen here. Panels discussing distribution, short-term rentals, operations, innovation, marketing and development all prompted lively debates and audience interaction, particularly a session where four entrepreneurs made a five-minute pitch about their start ups in the hope of winning a fictional £50 million investment - the winner, James Eder of networking app, was selected by a live audience poll, and did win a (real) bottle of champagne.

This was followed by perhaps the liveliest session of the day, on business travel and relocation. Hosted by Mark Harris of Travel Intelligence Network, the panel consisted of two travel buyers - Jan Jacobsen of AIG and Kevin Carr of UBS, joined by Jo Layton of the Apartment Service and James McClure of Airbnb.

Despite being fans of serviced apartments in general, both Jacobsen and Carr stressed the need for transparency - buyers want to know who is actually operating the apartments being booked, and if operators are acting as agents too and selling someone else's inventory they should be up front about it. In Jacobsen's words, there is still too much smoke and mirrors" involved. Both buyers also highlighted the need for improved online booking systems, as many operators are still running like "cottage industries" according to Carr, who was backed up by Jacobsen's call for the sector to commit "serious investment in technology".

The conversation then moved on to Airbnb and its role in business travel. Carr said: "We are having good discussion with Airbnb byte they are not ready to work with us yet. They are not able to be a proper partner for a heavily managed travel program."

McClure countered by saying: "We are working on better integration with TMCs to improve our presence in the business travel sector."

"Airbnb is essentially a leisure product," said Jo Layton. "It can't provide for sustainable long-term corporate housing needs."

The day was rounded off by two case studies, both from Switzerland, by Nest Geneva and Vision Apartments, and a lively prize draw.

The atmosphere at the event reflected the buoyant and growing state of the European serviced apartment sector, which is undoubtedly maintaining its vibrancy in the face of external economic and geopolitical challenges,

To download the speaker presentations from the Summit click here.

Delegate feedback

"We love coming to the Serviced Apartment Summit every year. All the industry leaders are mingling with the smaller operators like us and it feels like one big family. Although it's a big industry, it feels like it's at the beginning of its growth and people are happy to help each other. It's a fun and creative atmosphere and it's great to meet lots of other people working in the same sector."
Christoph Wondraczek, managing director, Nest Geneva

"We've had a very good time here. We've got a stand, and for a small, young brand like us it's great to get ourselves out there alongside the more established brands and meet people, so we are considered for future projects across Europe."
James Fry, co-founder, Base Nyon

"I think it's been a fantastic event. It's really useful from my point of view to meet with my peers in the industry and to get updates on developments, new openings, and plans for the future. It's also good to get updates on how different operators work and to see the changes that are coming through in to the market place."
Simon Morrison, managing director, Select Apartments

"This is the third time I've been to the Summit and I always really enjoy it. It's a unique forum to meet up with people I  know, to connect with people I only know on LinkedIn, and people who genuinely have an interest in this sector and want to share their experiences."
Ben Davis, co-founder and director, Saxbury

"For me personally, being new to the industry, it's been a great opportunity to meet some of the key players, and to see that everybody is facing similar challenges as they forge their own identity and their own niche in the industry. It's helped to understand that our business is now one founded on partnership, working with some great operators out there."
Steve Burns, managing director EMEA and APAC, BridgeStreet Global Hospitality

"What can I say? Another amazing event! Many thanks indeed. A great crowd, some jaw-dropping content and innovative twists."
Richard Makewski, owner, essa Consultancy


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