Growth in the serviced apartment sector across Europe continues to outpace that of traditional hotels with many of the biggest operators set to double their portfolios over the next three years, according to a new report from global hotel consultancy HVS.
The sector’s pipeline is set for further expansion across Europe, with 23,600 additional apartments due to be added to the inventory by 2022, making it one of the most active sub-sectors in the hotel industry. London will account for around 39 per cent of the UK’s new inventory with just under 3,000 apartments, followed by Manchester (16 per cent) and then Edinburgh and Cambridge (both with around 10 per cent of the UK total).
Ben Davis at Saxbury said: “Serviced apartments offer a secure source of income at a time of global uncertainty. As the sector is becoming more mainstream we’re frequently being contacted by developers seeking advice and representation prior to embarking on their first aparthotel project, their timing couldn’t be better as the sector continues to innovate, with a raft of new brands being introduced over the last three years. We feel incredibly positive about the long term prospects of this asset class”
“The lenders we surveyed continue to be happy to support further developments, particularly those in gateway cities, although brand and location are important requirements and some concern has been expressed about over-supply in some Western European markets.” said Sophie Perret, director at HVS.
Established brands will see the largest increases to their Europe pipelines, in first place there is Adagio with 6,100 apartments spanning 50 projects in Europe, a close second is Stay City (4,800 apartments). SACO, Adina and Marriott’s Residence Inn brands have confirmed they will open another 1,000 units up to 2022.
Image credit Room2 Hometels Hammersmith