Corporates advised to take flexible approach when they consider how best to manage the impact of changes in global accommodation market. SilverDoorโs latest quarterly market report highlights how to best manage impact of changes to your global accommodation programmes…
Healthy levels of investment and growth of supply of corporate housing stock worldwide have put corporate travel managers in pole position to negotiate favourable rates and best value itineraries over the summer months. The news are reported in the latest quarterly market update report from SilverDoor, the worldโs leading serviced apartment agent.
Increased demand impacts the changes of global accommodation market
However, as the summer holiday season comes to a close, particularly across EMEA and the Americas, demand looks set to increase worldwide. Coupled with the impact of key legislative changes across global accommodation markets starting to take effect, the SilverDoor report also outlines the need for a flexible, dynamic approach to managing accommodation and wider travel programmes, budgets and policies.
Specifically, both Dublin and Singapore have reported a host of new openings and growth in supply in recent months. That said, booking data from SilverDoor outlines this September already looks set to be busier across Europe, compared to the same period last year. Likewise, the easing of Chinaโs visa restrictions is also having an effect with international demand for China on the rise, alongside a 13% growth in enquiries for Hong Kong compared to April-August 2023 across APAC. The most popular destinations for bookings across the last quarter have been Amsterdam, London and Barcelona, followed by India, Japan, Taiwan and Riyadh.
What legislative changes are affecting the global accommodation market
Within EMEA there are a number of legislative changes impacting the market. These include Barcelona, where the minimum stay requirement of 31-32 nights is posing a supply challenge for the short-term rental market. In the UK, the new recently elected Labour government has announced mandatory local authority housebuilding targets to drive housing developments and the property supply chain. Across North America, key destinations including New York, Toronto and Colorado, have also tightened short-term rental laws to support local residents as well as visitors.
Corporates request better value for accommodation
As corporates maintain a keen eye on supply and cost, they have also been focused on driving better value in the last quarter. This means not necessarily securing the lowest rate, rather adding value to the rate they have agreed by negotiating extras such as complimentary breakfasts or reduced housekeeping fees; a strategy which can improve the overall balance sheet of a trip and has also seen a marked increase in adoption compared to the previous quarter.
Commenting on the findings, Martin Klima, Chief Customer Officer, SilverDoor said, โThe growth in supply has been welcome news for corporates, particularly at a time when many will be planning budgets and programmes for the year ahead. However, critical to any accommodation supply is how it is legislated for and managed by local authorities and government, as that will inevitably define its ratio of availability for local residents versus visitors.
โWith that in mind we would advise a degree of flexibility when planning ahead. Whilst cost remains one of the guiding principles of planning and managing a travel programme, itโs important for corporates to remain realistic about the standard of accommodation and facilities available to them within ADR and legislation brackets, manage traveller expectations accordingly and look at alternative options if and when needed. For example accommodation that is perhaps out of immediate city centres but still workable due to extended transport links and commute times and keeping length of stay flexible where possible.
โBy the same token, longer lead times enable more time to negotiate on rates so do plan trips and itineraries as far in advance as possible. There is an encouraging level of choice and availability but that can shift. To best manage this, corporates must stay agile in their approach to booking and managing accommodation and their wider travel programmes.โ
The full SilverDoor Market Update is now available to read here
