Developers: Let's take a closer look at serviced apartments

Serviced apartments and apart-hotels are relatively recent products in the lodging industry that have gained tremendous popularity over the last decade, thereby representing a significant competitor to conventional hotels in global markets.

Legitimisation of the sector has occurred through planning via expansion with purpose built stock with a hotel (C1) consent, the sector currently lacks institutional grade stock on any large scale, but this situation is changing as developers and investors seek to deliver purpose built stock into the market.

The serviced apartment and apart-hotel sector offers a wealth of potential – if only you can anticipate and mitigate the pitfalls.

While some of the international Apart-hotel brands have relatively defined area programmes, this is by no means universal across the sector which presents multiple challenges for developers seeking simply to identify development characteristics and institutional yield.

As advisors to investors and developers in this specialist asset class, we remove the guesswork, dispel common myths and assess how viable an idea is – before you encounter risk.

If you are looking for an operator to lease a planned apart-hotel we can assist with the selection of a suitable partner. Our book of operators stretches across continents – and continues to grow every year. By tapping into this network, we can identify the appropriate operator for your project then secure the most advantageous lease.

Delivering insight and advice via our feasibility reports and lease valuations, we help you secure a lease at a pre-planning stage – then unlock greater choice when it comes to funding or exiting your project.

Our clients often rely on us to complete their journey from a project’s starting point (evaluating the development fundamentals), via navigating the fiscal and contractual aspects of a lease, to sourcing development funding, knowing they’ll achieve the optimal result.

A complete appraisal of your project would usually include:

Property valuation (GDV) when operated as serviced apartment

Lease & management contract evaluation

Alternative uses

Conclusions on feasibility

Identification of suitable brands and commercial lease negotiations (heads of terms & contracts)

In a sector that’s growing quickly but haphazardly, seizing the best opportunities can be hard to achieve. Saxbury offers developers who are new to this asset class valuable support to help capitalise on the tremendous opportunities this dynamic sector presents.