Worldwide: Serviced apartment provider SilverDoor has released findings from its Accommodation Market Update report, which reveals how companies across the globe are adopting different strategies to manage costs.
For businesses across EMEA, many are willing to ask staff to travel further on the basis that accommodation will be cheaper. For example, commuter belt locations such as Reading and Milton Keynes have witnessed an increase in demand.
Lead times between March and May are up by 29 per cent year-on-year (from 28 days to 36). Both relocation companies and corporates believe that earlier bookings offer lower rates, and are therefore planning further ahead to mitigate the risk of higher last-minute rates.
In APAC lead times have also increased by 17 per cent (from 35 days to 41). In response, many providers have adopted dynamic pricing models with coliving apartments in particular growing in popularity.
The Americas has also witnessed an rise in lead times (by 27 per cent, from 35 to 44 nights) however relocation has seen a decreased of 45 per cent. This is being attributed to tighter budgets and hiring slowdowns. In contrast, TMC reservations have nearly doubled with an increase of 96 per cent.
Stephen Homsey, regional head of Americas, SilverDoor, said: “Cost continues to be the determining factor for both corporate and relocation managers when planning their accommodation strategies. This is driven not only by the current economic challenges and hiring slowdowns, but also by the growing influence and impact of sustainability and ESG targets.
“However, whilst there is the opportunity to sacrifice location and short commute times to help manage this, the same compromise can’t be made on the quality and standards of accommodation that is booked and this also remains a top priority, second only to cost. Businesses and employees want to be assured of safe accommodation with suitable facilities that meet their policy requirements.”
Homsey added: “Given the need to maintain quality whilst at the same time control costs, both businesses and operators have needed to adopt broader, more diverse strategies when managing accommodation. Globally these strategies have been characterised by a longer term approach to bookings with lead times significantly increasing at a global level. It is reassuring to see demand is still there albeit in a new guise and with an ever-sharpened focus on costs. We expect budget-sensitivity to impact the market in the months ahead so operators need to bear this in mind when planning rates and working with corporates and relocation companies who are willing to take a diverse approach to their accommodation strategy.”
The full SilverDoor Market Update is available to read here.
