Vincent Miccolis, regional boss of serviced property provider Ascott, says investors, developers and owners are looking at model off the back of coronavirus crisis
Global serviced property provider Ascott The Residences has revealed increased interest in serviced apartments off the back of the Covid-19 pandemic.
Vincent Miccolis, Ascott’s regional GM for Middle East, Africa, Turkey and India told Arabian Business that none of the properties in the area he is responsible for closed their doors during the coronavirus crisis, despite widespread curfews, lockdowns, movement restrictions and other various government guidelines.
“The good thing about our group and our business model is that we are focusing on extended stays so we’ve been more resilient. A lot of hotels have closed and some maybe won’t reopen soon. Thanks to our long-stay and extended stay business we’ve managed to stay open,” he said.
STR has previously intimated that the impact of Covid-19 globally to the hospitality industry could be as much as $1.2 trillion should the sector not see signs of rebounding soon.
Vincent revealed that occupancy levels dropped as low as 25-30 percent on some properties, while others were able to maintain levels of up to 60 percent. And he said that has alerted owners, investors and developers to their business plan, with many adding a long-stay element into their proposition.
He said: “I’m not saying it’s been a blessing (Covid-19), of course not. It’s been a big crisis, but we’ve managed to weather the storm better than hotels because of our long-stay component.
“We are seeing owners, investors and other hospitality groups as well coming to us, asking for more details, really willing to see how we work.”
Ascott is the global leader in serviced residences and boasts nearly 120,000 units worldwide, with properties in the UAE, Saudi Arabia, Bahrain and Oman, among a myriad of others across the world.
Vincent explained that, in terms of a five-star hotel, operators require, on average, one or 1.5 members of staff per room. However, for serviced apartments, this level drops down to as little as 0.4 in some instances.
“It really depends on the region you’re in and the products, but overall our margins are always much higher than hotels. The cost efficiency of a serviced apartment is much better than hotels,” he said.
“When you have a long-stay component, an extended stay, your overall cost gets lower because you don’t necessarily do a cleaning every day. You don’t need to get your towels changed every day. There’s a lot of things you don’t need on a daily basis because it’s like an extended lease, like a rental concept, but you have the service of the hotel.
“The developers and investors are seeing that now for sure.”
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