ESG credentials are playing a growing role in attracting customers with 42.3% of respondents stating that the ESG credentials of their business were ‘very’ to ‘extremely’ important in driving consumer demand.
Expectations of further operational recovery through 2022 has led to a boost in confidence in the serviced apartments sector, according to the latest Association of Serviced Apartment Providers (ASAP) /Savills sentiment survey conducted in February 2022. 84.6% of respondents are ‘slightly or significantly more optimistic’ about their business prospects compared to the last survey, up from 81% in June 2021. Eight out of ten (80.8%) respondents expect occupancy to recover fully by end of 2022, pointing to a recovery in the next eight months, with over half (57.7%) already reporting occupancy at pre-Covid (2019) levels.
ESG credentials are playing a growing role in attracting customers with 42.3% of respondents stating that the ESG credentials of their business were ‘very’ to ‘extremely’ important in driving consumer demand. This was reflected in responses around future expansion, as 61.5% of operators said the energy efficiency of a building will be ‘very’ to ‘extremely’ important when acquiring new property in the future.
While operators remain positive in the outlook, staffing costs (65.4%) and availability (57.7%), the risk of international travel restrictions (61.5%) and energy costs (53.8%) were all cited as a ‘slight’ or ‘significant’ challenge the sector will face over the next three years.
Marie Hickey, Director in the Commercial Research team at Savills, says: “Serviced apartments have been the better performing segment of the wider hospitality market due to their typically leaner operating model and self-contained accommodation, enabling resilience through some of the recent challenges. Operational performance is recovering at pace, outperforming hotels in some markets, and our recent survey shows that operators expect occupancy to recover this year with many already reporting occupancy rates at pre-Covid levels. Looking to the future it is clear ESG is going to play an important role in shaping guest demand, particularly amongst corporates, and investor decisions.”
James Foice, CEO, Association of Serviced Apartment Providers, adds: “Our Members have been telling us for some time that they're feeling increasingly optimistic about the coming months and years, as restrictions ease and both business and leisure guests return to travel. So to see this reflected across the sector is very heartening. “It's also interesting to see our own guiding pillars of people, planet and principles are so important to operators and travellers. The post-pandemic landscape offers a wonderful opportunity to put sustainable practices front and centre as the sector continues to expand.”
Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales.
She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.
