The 5th annual SO!Apart Serviced Apartment Conference in Berlin (22/23 November),  pioneered by Apartmentservice (Germany) brought together 200 influential players in the sector – including investors, operators and distributors – for 2 days of stimulating discussions at this time of incredible growth in the German market.

Joyce Cawthorpe, ASAP’s Marketing & Media Manager, represented the UK sector at the event and has compiled this report.

The overall theme for the conference was to reflect on the many successes/achievements but also to debate how the sector can remain ‘fit for the future’.

Opening the conference Anett Gregorius reflected on key developments in the sector in the last 12 months including the trend towards micro-apartments; used to talk about minimum size of 30 sq metres, now a unit of 20 sq metres can offer same level of facilities, as well as so many new and innovative openings in key cities throughout Germany.  Significant trends towards larger developments as larger operators enter the sector – reference was made to ‘The Fritz Berlin’ – 18 storey building – with 266 (1 & 2 bedroom apartments 22-51 sq m). Future growth is incredible: the sector is expected to grow by 40% by 2019 (additional 13,000 units) and is firmly establishing itself as a mainstream player in the hospitality industry.  Current occupancy for the sector overall is 77%.

The opening keynote ‘Temporary Living: a dynamic new trend’ by Professor Stephan Gerhard (MD, Solutions Holding) talked through the megatrends of individualisation, personalisation and urbanisation which impact on the way people will live and work in the future as well as the growth in mobility.  All of which will contribute to the sector’s growth: he anticipates the market will treble in size by 2030 to achieve a market share of 10% of the total hospitality sector (it’s 3% currently).  He pointed out that the serviced apartment sector has grown by an average of 10%/year; the hotel sector on average 0.9%/year between 2007-2016.

Some of the new developments in the next few years include:

  • The Fizz in Aachen – 330 units – 2018 (student residences) the-fizz.com
  • The Doorman, Frankfurt ‘feels like coming home’ thedoorman.de
  • Co-Living in New York – 9 sq metre units – pretty small but then in communal space you have everything you need from kitchen, skatepark, place to do yoga together etc

It was very insightful to have both Marriott and Hyatt present their future plans in the extended stay sector, as they develop new products to meet the considerable demand for a more flexible ‘way to stay’.  Anna-Katharina Korte presented  for Hyatt: The ‘Hyatt House’ extended stay brand has now opened in Istanbul and will open in Dusseldorf (190 units) in the near future.  Offer a communal area ‘the commons’ for guests to meet and enjoy a drink together; ‘outdoor commons’ where guests can barbecue together.  Each property will always have a fitness area and sometimes a swimming pool.  Overall concept is for the guest ‘to be able to live in the city not just stay in the city’ and delivering consistent good service.

Marriott International’s Markus Lehnert confirmed extended stay was the biggest growth area for them.  He explained about the need for their extended stay guests to feel ‘connected’ to where they are staying.  Marriott currently have over 1000 extended stay properties worldwide, the majority in the USA/Canada; explained the European growth with new openings:

  • Residence Inn: London – Edinburgh –Aberdeen
  • Element: Frankfurt & Amsterdam
  • Marriott Extended stay: Turkey & Belgium

Key thinking behind the extended stay brands:

  • Good design, no exuberance
  • Natural – modern – aesthetically pleasing/good design
  • Achieving balance: the healthy option
  • Sustainability is important (100% recycling)

In the future: ‘Communal living is king’ – where they are looking for example at a grouping of 4 bedrooms and 1 living room.

SO! Apart – Day 2/23 November

‘The Apartment of the future’

A fascinating film showing how ‘the apartment of the future’ project is nearing completion.  This was launched at the 2015 conference, then at the 2016 Conference there was a brainstorming workshop to discuss further innovative ideas and as a result the 2 ‘test’ apartments, in spite of numerous challenges in the course of the project, are now ready be launched 30 January.  This has been a joint project between Apartmentservice Germany, JOI-Design, iHaus and G&S planwerk.    Particularly innovative ideas have been implemented in terms of progressive room division, technology and service. One 2-bedroom apartment (40 sq m) with a high degree of personalisation targetting the sector ‘demanding individuals’ ; one small studio apartment – 28 sq m – with a very individual design targetting a younger target market and offering ‘instagramable moments.

Distribution

Professor Marco A Gardini, (University for Advanced Science, Kempten) delivered a very insightful and thought-provoking presentation ‘Distribution is everything: without marketing you have nothing’

He explored some of the key reasons why some brands are so successful – like Motel One; also looked at the dangers of being too sales-driven and not marketing-driven. The importance of being clear about exactly what your USP and business proposition is, how you differentiate your offering and what you clearly do much better than your competitors; and also touched on the dangers of outsourcing your all-important relationship with your customer to call centres.

He then moderated a very interesting panel discussion with 4 booking platform operators who explained their points of difference and how the market was changing:

Founded 1999 as booking platform/agent, the first independent agency for serviced apartments in Germany; Focus on building a highly personal relationship with their clients

New online market place offering 18,000 flats including serviced apartments for temporary living to take the stress and hassle out of renting a flat/apartment for short period of time

Founded 2015; Make booking serviced apartments easy for all parties: the operator and the business traveller; professionally-managed, furnished business apartments worldwide

Founded 2015; offering booking platform for business travellers to rent furnished apartments for stays of minimum one month; will expand across Europe including the UK

Airbnb

The conference ended with a fascinating presentation by Alexander Schwarz, Market Development Manager Airbnb (Germany, Austria, Switzerland). 

He began his presentation exploring the way the world has changed and in particular the significant change in consumer travel behaviour , in view of the technology available, and talked through how Airbnb first started back in 2007.  Very interesting to hear him talk about Airbnb being ‘People Powered’ but that ‘the magic happens offline’ since the focus is very much about building relationships between hosts and guests.

The ‘Airbnb for business platform’ now has 250,000 companies using the platform including global brands like Daimler, amazon and facebook and mentioned that 18,000 companies are signing up each month.  ‘Business travel ready’ homes offer 24-hour check in, premium support and wifi.

He highlighted their innovations for company travel in terms of:

  • Dashboard for visibility and duty of care
  • Central billing and reports

They have also recently launched a partnership with ‘we work’

He also talked about the launch of their ‘experiences’ brand to give customers the opportunity to book more individual holiday experiences with the move away from mass tourism.

Anett Gregorius then led an interesting Q &A discussion with Alexander Schwarz to conclude the 2 day conference.