The global serviced apartment market size will be $30.27 billion in 2024 with a CAGR of 9.97% from 2024 to 2029.
Definition
A serviced apartment is a fully furnished apartment, available for both short-term and long-term stays, providing amenities for daily use, housekeeping and a range of other services, all included within the rental price.
Market by Type
According to type, the serviced apartment market is divided into on-site managed and off-site managed. Among them, on-site managed occupies a dominant position, accounting for about 67.63% of revenue, and off-site managed revenue accounts for about 32.37% in 2024.
An on-site managed serviced apartment will usually feature a reception and property manager.
An off-site managed serviced apartment has no staff on-site – guests self-check in and keys are usually collected from a safety deposit box.
Types | Revenue Share in 2024 |
On-site Managed | 67.63% |
Off-site Managed | 32.37% |
Market by Application
Based on application, the serviced apartment market is divided into corporate and leisure. Among them, corporate dominates the market with a revenue share of about 62.99%, and leisure revenue share is about 37.01% in 2024.
Corporate means a legal entity created by individuals, stockholders, or shareholders, with the purpose of operating for profit.
Leisure refers to the time spent outside basic life activities and activities such as labor, housework, business, education, etc.
Applications | Revenue Share in 2024 |
Corporate | 62.99% |
Leisure | 37.01% |
Market Drivers
A serviced apartment is an apartment that provides hotel-style management services. It integrates the functions of residence, hotel, and club, and has two functions of “self-use” and “investment”, but its essence is still an apartment. Serviced apartments not only absorb the service functions and management models of star hotels, but also absorb the characteristics of office buildings in the information age. They have good communication conditions and can provide targeted business services such as secretarial, information, and translation.
Unlike traditional hotels, serviced apartments are designed for a residential lifestyle, offering larger luxurious living spaces with well-equipped kitchens and in-unit amenities. This allows guests to find the safety and comfort of self-sufficient living within a personal sanctuary. Guest profiles for serviced apartments span a diverse demographic, not just for families but also for discerning digital nomads. When families and friends travel in large groups, they often opt for serviced apartment accommodation as it gives them the opportunity not only to stay together in two- and three-bedroom apartments, but also to take advantage of the kitchen facilities to prepare food. The communal spaces within these spacious apartments allow for greater participation in a safe, enclosed environment.
With the rapid economic growth and the acceleration of urbanization, the demand for business travel, business trips, training, etc. continues to increase, providing a broad market space for serviced apartments. At the same time, economic development has also led to the improvement of people’s income level and consumption ability, making more people willing to pay more for high-quality living environment and services.
With the change of society, people’s requirements for living style and quality of life are also constantly improving. On the one hand, people pay more and more attention to personalization, privacy, and comfort, and are unwilling to be bound and restricted by traditional hotels. On the other hand, people are also paying more and more attention to the sense of family and sociality, and hope to enjoy the warmth and convenience of home when they live. Serviced apartments can just meet these needs and provide customers with a more flexible, free, comfortable, and humanized living experience. Therefore, serviced apartments have risen rapidly in the market, providing people with more choices and a better accommodation experience.
Industry Development Trends under COVID-19 Outbreak
The outbreak has led to the worst global recession in decades despite massive efforts by governments to tackle the pandemic, supported by fiscal and monetary policies. But in the long run, a severe recession triggered by the epidemic will reduce investment and lead to a prolonged economic downturn. The COVID-19 pandemic persists, and the recession could get worse if movement restrictions are extended or reintroduced, or if economic activity is disrupted for a prolonged period. Businesses could struggle to repay debt, heightened risk aversion could lead to higher borrowing costs, and bankruptcies and defaults could lead to financial crises in many countries.
COVID-19 has had a wide-ranging and far-reaching impact on the serviced apartment industry. With the travel restrictions and the uncertainty of the epidemic, tourism and business activities around the world have been greatly reduced, which has directly led to a sharp drop in the source of serviced apartments. Many canceled or postponed planned travel and business trips, reducing demand for serviced apartments. In the past few years, the serviced apartment industry has been relying on the steady growth of tourist and business tourists. However, with the outbreak of the epidemic, countries and regions have implemented travel restrictions and prevention and control measures, which has greatly impacted global tourism and business activities. Many people are choosing to cancel or postpone planned travel and business trips to reduce the risk of infection. This change directly leads to a sharp decline in the occupancy rate of serviced apartments.
Due to the outbreak of COVID-19, consumer concerns about hygiene and cleanliness have increased significantly. The serviced apartment industry needs to adopt more stringent and comprehensive cleaning measures, including frequent disinfection, increased ventilation and air filtration, etc., to ensure the health and safety of residents. With the improvement of COVID-19, the serviced apartment industry is expected to usher in a gradual recovery of tourism and business demand.
Consumer Behavior Analysis
Consumers of serviced apartments are mainly mid-to-high-end people with certain financial strength, pursuing high-quality life, and paying attention to individuality and privacy, such as travelers and business people. Consumers’ income level, age structure, gender ratio, education structure, occupation structure, etc. will all affect their demand and preference for serviced apartments.
The main factors affecting consumers’ choice of serviced apartments are traffic conditions, supporting facilities, and prices. Traffic situation is one of the most important influencing factors, because consumers hope that serviced apartments can be conveniently connected to various important areas of the city, such as commercial centers, airports, railway stations, etc., to save travel time and cost. Supporting facilities are also an important factor, because consumers expect serviced apartments to provide a comfortable, convenient, and safe living environment, such as furniture, home appliances, network communications, and security services. In addition, price is a basic influencing factor, because consumers will choose a suitable serviced apartment according to their economic ability and budget, and also consider cost performance and market conditions.
Top Companies
The serviced apartment market is highly competitive with major players including Ascott, SACO, Sonder, Aparthotels Adagio, Blueground, Staycity, Q Apartments, Numa, Locke, Roomzzz Aparthotels, Cheval Collection, Edgar Suites and Roomspace. The revenue shares of the top 3 companies accounted for about 19.92% in 2023.
Players | Revenue Share in 2023 |
The Ascott Limited | 11.56% |
SACO | 6.31% |
Sonder | 2.05% |
