THE SERVICED APARTMENTS INDUSTRY CONTINUES TO SHOW HEALTHY PERFORMANCE ACROSS THE UK. According to accommodation data specialist STR Global, revenue per available room (Revpar) is up 4.7 per cent – driven almost entirely by average rate rather than occupancy, which increased by only 0.6 per cent across the country, whereas rates went up 4.1 per cent. In London, a fairly robust increase in supply meant occupancy levels showed a small decline, but rates are more than making up for that and there was Revpar growth of 3.1 per cent.
In regional UK, however, performance was more evenly split, with occupancy up 1.5 per cent and rates up 2 per cent. “We have seen greater demand across the board and small occupancy increases are a result of supply-demand equilibrium, with supply growing quickly and, in London, outpacing demand growth, which is what we are seeing in the hotel industry,” says STR Global director Thomas Emanuel. He adds that the rise reflects a generally positive situation, with UK hotel Revpar up 4.5 per cent.
London still has easily the largest pipeline of any city in Europe, with 15,013 keys in the making. “How much better can it get? We have seen the capital perform towards the 90 per cent occupancy mark in summer and early autumn, September/October, with consistently strong demand over the past few years,” says Emanuel. “And because new supply continues to come in, we won’t see dramatic occupancy growth, that will still come from average rates, as in 2015.”
And activity among travel buyers reflects this. Business Travel Show’s research elicited that 19 per cent of 182 European travel managers polled booked 4 per cent more serviced apartment accommodation in 2015 than in 2014, and 48 per cent of those questioned insist travellers stay in serviced apartments when their trip exceeds a certain duration.