The rise of workcations (working vacations) will boost the demand for serviced apartments, according to hospitality player Tajara Leisure and Hospitality Group, as reported by Business World.
The industry expert said that more professionals will likely prefer being in these types of accommodations, filling Zoom breaks with meaningful leisure activities. The growing preference for mini-kitchens and larger gym areas in these accommodations suggest an inclination towards recreation in the midst of work.
In other parts of the world, workcation is also on the rise. To deal with the stress and burnout, professionals look for accommodations outside of their residence for a change of scenery. The year-long travel restriction resulted in the pent-up desire to take a vacation, even if it would mean bringing work.
Commercial real estate services firm Cushman & Wakefield echoed the positive forecast on serviced apartments, noting that they make for a “profitable, crisis-proof” investment.
They identified other factors that fuel the stable market appetite. For one, serviced apartments appeal primarily to business travelers who are in need of safe, professionally managed accommodations. They are an alternative to hotels, as they are fully furnished and equipped with amenities and services, such as housekeeping and laundry service. Occupants can stay short or long term.
Another contributing factor Cushman & Wakefield identified was the projected growth of the business process outsourcing (BPO) industry. They said that the market is still young, with a lot of potential to be professionalized.
Urbanization and the new normal of work from home, which allows people to be more flexible in terms of where they perform their jobs, will also increase the demand for serviced apartments.
For those looking to invest in a serviced apartment, Cushman & Wakefield suggests partnering with a professional operator to ensure better management of the property and tenants. The firm said the professional operator will handle marketing and maintenance of the property, removing the hassle for investors.
Meanwhile, Tajara Leisure and Hospitality Group recommends doing due diligence, looking at the historical performance of developers and operators, understanding lease term agreements, and knowing the location well.
Lamudi’s trend report titled Indicators of Growth: Where to Invest in 2021 may provide property hotspots worth considering. Noting that the vacation rental property market has seen signs of recovery in the latter half of 2020, the report showed that listings in tourist destinations, namely Antipolo, Lapu-lapu and Tagaytay, earned more inquiries in the second half of 2020 compared to the same period the previous year.
Listings priced between 30K to 60K, as well as those at 60K to 100K increased by triple digits. Meanwhile, rental properties priced within 5K to 15K attracted the highest number of inquiries in January of this year.
Optimism from Vaccinated Travelers
The confident outlook on the serviced apartment industry will likely be stronger in the next months as the country makes plans for welcoming fully vaccinated foreigners.
The Department of Tourism (DOT) recently proposed a “green lane” policy for vaccinated international tourists and returning Filipinos, CNN Philippines reported. They are also asking the Inter-Agency Task Force for the Management of Emerging Infectious Diseases to ease travel restrictions, permitting movement from the NCR Plus bubble to other areas outside the restricted zone as long as the tourists present a negative COVID-19 test.
In a Business World report, local airlines expressed their support for DOT’s green lane policy proposal. Low-cost carrier Philippines AirAsia is planning to offer incentives for vaccinated travelers. The move, according to them, will not only promote tourism, but also encourage eager travelers to get the vaccine.
Cebu Pacific noted that their surveys revealed that people are interested in traveling, but the requirements and restrictions hinder them from pushing through plans. They said that introducing a simpler, standardized process is the best way to provide incentives for vaccinated individuals. It will also make domestic travel “easier for all.”
AirAsia added that a digital travel pass strengthens uniform travel requirements, promoting leisure tourism.
Nonetheless, some business groups are already banking on the country’s vaccination program enticing foreign tourists, including business travelers.
The Korean Chamber of Commerce Philippines said in a CNN Philippines report that they are expecting Korean tourists and businessmen to return to Manila, as the immunization drive continues. They anticipate two million individuals, the average number of Koreans traveling to the Philippines for leisure every year prior to the pandemic.
Sources: Business World, Spectrum News1, CNN Philippines