Eight trends to watch in global serviced apartments
Interview with Vivi Cahyadi Himmel, CEO and co-founder at AltoVita, the female-founded corporate accommodation platform.
23 May 2023
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Growing demand for serviced apartments from both business and leisure customers, the desire for value amid greater pressures on corporate budgets, and the importance of the employer in ensuring duty of care are all key trends in the serviced apartment sector in 2023.
A new way of living and working
Serviced apartment living gained traction during Covid, as business travellers and assignees searched for accommodation that provided extra space for home working rather than just a hotel room. New trends also emerged around the importance of employers providing a duty of care for employees, with a greater focus on location, personal wellbeing, and communication.On a more global level, the sector has seen the introduction of new brands, an increased interest in sustainability and Environmental, Society and Governance issues (ESG) and a focus on serviced units being used both for business and for leisure activities. Providers are also looking to differentiate their offerings, with some brands aimed at younger travellers and Generation Z customers who want to experience a more authentic stay.Having worked abroad on a regular basis, Vivi had personally experienced the administrative burden of relocation. With her business partner she decided that technology could solve many of the issues around booking safe, secure, and convenient accommodation for business assignees.Safety and the employer’s duty of care
“Serviced apartments need to cater to the needs of large companies, focusing on duty of care, safety, security, compliance, and employee satisfaction,” she says. “Companies want to be able to offer seamless booking and check-in and know that the accommodation they book for their employees meets the requirements of duty of care.”On the AltoVita platform, operators can showcase their sustainability efforts, such as waste management and energy and water consumption management, and can demonstrate their safety features, including fire extinguishers, carbon monoxide and smoke detectors. The feature uses geotagging to verify that the pictures are taken at the specific property. The platform aims to provide a rich booking experience where users can have detailed information about the properties they want to stay in.Economic pressures are changing the market
Cost savings are likely to continue to be a significant focus in 2023. According to AltoVita’s recent survey, companies could unlock opportunities in the extended stay market through consolidating the purchasing power of their business travel and global mobility departments.“The survey revealed that 40% of surveyed managers in these areas do not communicate with each other, largely due to different reporting lines within companies,” Vivi says. “Yet accommodation is one of the largest expenses, accounting for about 20% to 30% of spend in both business travel and global mobility departments. By encouraging the consolidation of purchasing power across the whole of a company, clients can achieve additional cost savings and economy of scale.”She also points to a lack of visibility on spend in many organisations. Many managers face a blind spot when it comes to visibility on spend, often due to the absence of appropriate technology platforms or holistic data and spending monitoring systems. This lack of visibility can hinder efforts by HR, mobility or finance departments to manage costs effectively.In order to enable clients to consolidate purchasing power between business travel and global mobility to achieve cost savings, AltoVita is launching a new cost management capability. This feature will allow clients to access and view spending information in different areas, providing greater visibility and addressing the pain point of having a lack of transparency when it comes to overall spend.She says procurement managers are actively looking for new and more cost-effective ways of managing accommodation spend due to the current economic conditions.Location and budget are forefront
Alongside ensuring employees are safe, location is also an important factor in the accommodation choices.While financial services companies tend to focus on business locations such as New York, London, Hong Kong, Tokyo, Paris, and Singapore, companies serving other sectors like consumer goods, pharmaceuticals, tech giants and energy face the challenge of accommodating employees in more difficult and remote locations.“Financial services companies often prioritise cost-saving solutions and tend to focus on first-tier cities,” she explains. “However, AltoVita serves clients from various sectors, including those with more remote and difficult locations.”AltoVita is also working with investors and partners, many of which are major real estate companies, to advise on what the market needs when they are creating new accommodation inventory in areas where properties are not readily available.“When I was travelling and doing research myself, I ended up resorting to Google to try to find the right reliable partner in each different region,” she says.“In most of the markets I even had to meet the landlord or provider in person to sign the lease. For example, when I was in Tokyo, I had to meet with the property manager, and it was all done on paper and the experience from searching to booking was painful. Then after you have stayed for a whole month and you want to extend the lease again, you must meet them in person to sign the lease on paper.”“When you are trying to research and verify accommodation as an individual, it can be difficult to find out more about the offering. Sometimes in foreign countries you can’t even read the reviews because they are in a foreign language.”Personalisation is key
Personalisation is a key aspect of AltoVita’s offering and one which companies and their assignees are increasingly interested in.“Our goal is to provide a personalised experience for each booking,” Vivi says. “We aim to serve clients from interns all the way to executives. It is about having the right solution for the younger population including graduate trainees, associates and interns for whom travel within a company might be a key career objective. Then there are the more complex cases with senior managers who are travelling and relocating with their children, family pets, and possessions.”She says AltoVita has two main offerings. One is a high-touch service which seeks to understand the requirement of each individual booking and provides the three best curated options for the employee to choose from.The second one has built-in parameters which enable companies to set their required location, budget and facilities and then allow the employee to choose from a menu of options.The contribution of technology
Technology will increasingly play a significant role in global serviced accommodation. AltoVita’s technology integrates with property management and brings live inventory content to the platform. Greater visibility and choice mean travel and mobility managers can have better control over spend and accommodation choices.The platform provides comprehensive information about properties, including rates, availability, amenities, sustainability practices, and safety features. AltoVita enriches the content further by adding their own information on sustainability and safety. Travel and mobility managers can also view their spending, budget, and expenditure in different regions and periods and track expenditure on minority-owned, women-owned and sustainable properties.Sustainability is increasingly important
Sustainability is high on the agenda for serviced accommodation providers and their clients. Companies are increasingly focused on demonstrating sustainability to their shareholders, and sustainably operated companies tend to perform better.“It's every company's dream to demonstrate net zero emissions by 2030,” Vivi says. “In the future, it is in our product roadmap to create our own property management system that our operators can connect to. They would then be able to see how much is being spent on energy, what the energy consumption is, and what the Co2 emission is per night per property.”“Many companies want to build a better world for our future generations and would be keen to understand the sustainability practices of operators,” she says.A new focus on wellness
Wellness amenities are gaining importance, especially after the Covid-19 pandemic. Clients are interested in amenities including gyms, swimming pools, and other wellness-related facilities. While individual assignees may not directly request wellness amenities when booking, there is evidence that once on assignment, they seek out such activities.“This indicates that wellness amenities are becoming more important to clients, even if they may not express it explicitly during the initial booking stage,” Vivi says.
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