The skills honed by the hospitality sector are a huge selling point when it comes to elevating the experience in a residential offering, according to Accor chief business officer Accor One Living and global head of mixed use, Jeff Tidsall.
While longer stay formats are growing in popularity and broadening in what they encompass, from accommodation for overseas corporate workers to luxury branded residences, he believes that how those based in hospitality add value to co-living is a major selling point when the hotel group talks with investment partners.“The real estate looks the same regardless of who operates them, but there is a clear operational role in terms of delivering the experience with hospitality. We can add value through the brand, through the experience. In residential it doesn’t have a [hospitality] reference point, or a parallel in residential,” he says.
Accor is one of the major hotel groups which have moved in increasingly into a sector which not only is growing in terms of concepts and delivery models but which is also blurring the lines between hospitality offers and the short-term or long-term residential sector.
Tidsall describes it as moving from a generalist model to a specialist model, with one division of Accor now dedicated to premium, mid and eco brands, while the other arm of the business is focused on luxury and lifestyle.
“We’ve pulled together expertise in the life cycle of a branded residence. If we went back five years, conventional wisdom would have said that this was a luxury offer. What we have seen is a number of new entrants, especially from the fashion [brands] side,” he says of a rapidly evolving market.
He cites Accor projects such as Mama Shelter, opening in Dubai in early 2024, plus a Novotel project next year and a Pullman standalone scheme in Singapore as examples of how the concept is being stretched.
“It needs to resonate with the buyer and have some credibility. Brands that that will do well are those that well positioned to address very specific offerings,” he adds.
ARIV Coliving CEO Eva White oversees a specialist company with one site operational in Basel and a second Swiss project under development. Currently, the average stay at its residence is five and a half months and she says that there is still an educational piece needed around what co-living really means.
“Co-living is one of these buzz words and there are hundreds of definitions. But it can be anything from a professionally managed flat to a full service hotel, or in the UK it’s often seen as closer to the residential market,” she says. “But hospitality services are very relevant to the proposition so how they form from hotels is very relevant.”
ARIV Coliving is particularly based around people who choose to work away from home, whether that be in a corporate business or as self-employed workers and it is a demand that has grown in part thanks to the pandemic, she believes.
“There is an increasing base of freelancers who can work anywhere but even people who are employed are not necessarily tied to a location anymore and as a result more people are choosing that lifestyle,” she says. “However, loneliness can be an issue [in such a move]. People crave social interaction and often people will come from different countries or different cities and they would like to meet like-minded people.”
With so many different operating models she says that it is no surprise that consumers, both individuals and companies, are confused.
“With our offer corporates were initially unsure, until were able to show that our concept is serviced apartments plus. You have your private unit and space but then you have all these additional hotel services and the community of like-minded people,” she says. “But it’s definitely an educating process. We still have a journey ahead of us.”
Another of the co-living brands tapping into changing lifestyles is Lyf, which has sites in 25 cities including Paris, Tokyo and Shanghai and has been designed to be a bespoke offer for a new generation of travellers, combining residential and hotels.
“Each facility has the same basics of a social kitchen where people can cook together, connected space with a lounge area, a social gym and after working out a social bar,” says parent company The Ascott managing director Europe, NH Lee.
“We also value a lot community. We want to provide authentic local stay experiences to our guests, integrating into our local community that create a bond between the property and the day-to-day local community,” he says of an approach that tries to leverage its location.
Last year extended stay accounted for around 19 per cent of the company’s business, while he expects it to grow to around 25-30 per cent in 2023.
“I think extended stay is also evolving,” Lee says. “We have just started a project in Amsterdam and this is one of our first ‘2.0 extended stay products’. One third of units come with kitchens, one third have a pantry and one third are just rooms.”
Europe is a “strategic cluster” for Ascott. It has operations in France, Germany, Ireland, Spain, Belgium and now the Netherlands and Austria. The company is also exploring opportunities in the CEE and recently signed its first management contract in Bucharest for a 5* luxury property.
“For us, it almost always starts with mixed use with a hotel asset driving the equation,” says Accor’s Tidsall. “We see it as a win-win-win, from an investor perspective there is an opportunity to share infrastructure, to enable multiple groups of users to use the same facilities. But it’s important not to get carried away with efficiencies, there is generally also a need to create private facilities,” he adds of maintaining high expectations.
“Residential also serves as a demand driver, whether for F&B, for the spa and wellness, or for private transportation. For the purchaser, the appeal is a knowledge that there is a brand backstop to care for the community and provide that level of service. We don’t see any counterpart for that in residential.”
All those quoted in the article appeared on stage at the International Hospitality Investment Forum (IHIF) held in Berlin between May 15 and 17, in a session called: Next level Residential Hospitality Shaping The Future of Living.