A new report from Savills Estate Agents has revealed London is the top market for overnight stays in the whole of Europe.
According to the company’s latest statistics, the UK capital has an average of 15.2 million overseas visitors per annum over a three-year average.
However, despite this, the study entitled Spotlight: European Serviced Apartment Market revealed London has one of the most constrained markets when it comes to the availability of serviced apartments for longer-term stays.
Amsterdam has the lowest available units, with just 0.2 per 1,000 visitors, while Paris has 0.3 and London has 0.6.
The serviced apartment sector is expanding, with businesses and business visitors favouring serviced apartments as a more comfortable option than short-stay hotel rooms.
However, larger operators are still trying to distance themselves from relying on the long-term corporate market, capitalising instead on the appeal to the short-stay business and leisure segment.
This has seen some move towards services that are more close to Apart-Hotels, offering short- to medium-stay options in a similarly comfortable setting as a serviced apartment.
These offer a practical solution to demand in London especially and they adhere to residential laws. For example, residential units being let as serviced apartments cannot be rented out for periods of less than 90 days unless they are in possession of a daily letting licence.
European travel and overnight stay is expected to increase in the coming years, with the general economic outlook improving throughout the continent. It is predicted a 1.6 per cent increase per annum in arrival numbers will be seen over the next four years, with the United Nations World Tourism Organisation forecasting arrivals will hit 608 million by 2018, with 47 per cent of these global international arrivals.
With London set to be one of the major areas to benefit from these increases, investment in short-stay and Apart-Hotels facilities could soon be lucrative.
However, London is traditionally the primary target for international expansion and this is expected to be the same when it comes to an increase in serviced apartments. Therefore, with take-up of these facilities set to pick up in pace in the next three years through purchases from international operators, now could be the best time to invest in this type of property.