Serviced residences battle it out with disruptive players
The digital revolution has brought about the likes of Airbnb, posing a huge challenge to the traditional players within the field of accommodations.
Weak economic growth in Singapore and economic uncertainties across the globe are making it a challenging time for Singapore’s serviced residences sector. All hope is not lost, as it has consistently survived uncertain economic environments and has gained a reputation for continuous growth over the years. Despite some bright spots, the serviced residences sector needs to keep close watch amidst the moderate business outlook.
Arthur Kiong, chief executive officer of Far East Hospitality, thinks that companies will be more likely to curb spending in relocation and employee mobility. As such, human resource managers are challenged to seek accommodation for foreign business travellers whilst stretching budgets. This is where the service residences sector can come in and offer its value proposition.
However, on the supply side, managers and owners of serviced residences need to step up their game in the face of changing demands.
The city’s labour crunch is forcing employees of the service industry to multitask within and across departments, thereby highlighting the urgency for increased digital innovation. Henrietta Chong, general manager of Great World Serviced Apartments, says that although the service industry prides itself in having a personal touch for every service it renders, a move towards automation cannot be avoided.
Serviced residences have to leverage their advantages at a time of grim economic outlook. In fact, Kiong says that the demand for serviced residences has grown over the past decade. This demand is fuelled by improved product knowledge, understanding of product benefits amongst corporates, and the
Business leisure – commonly called ‘bleisure’ – has become the newest trend in travel. The growing interconnectedness of markets combined with the energy of today’s young workforce have made this trend possible. Chong says that against a backdrop of austerity measures, the advantages of serviced apartments surface in meeting the needs of unique types of travellers.
“There’s a shift in the serviced apartment sector in response to demand for greater flexibility in room bookings and pricing, and this has resulted in some traditional long-stay providers diversifying their target segments to include short-term guests. In Singapore, the increased supply of hotels and serviced apartments is likely to outpace demand as managed travel continues to come under pressure in a globally uncertain and volatile environment,” says Richard Tan, vice president, Serviced Suites, Pan Pacific Hotels Group.
The digital revolution has also brought about the likes of Airbnb, posing a huge challenge to the traditional players within the field of accommodations. Clara Beng, general manager, Frasers Hospitality, says that it would be foolish to ignore the impact that Airbnb has made on the hospitality industry. With the rise of service providers such as this, companies are encouraged to remain competitive and rethink their entire distribution strategy. In fact, a lot of hotels are looking to merge with distribution channels to improve their online distribution.
“The entire consumer landscape
There’s a shift in the serviced apartment sector in response to demand for greater flexibility in room bookings and pricing.
Great World Serviced Apartments ranks first with a total of 304 rooms