More than 75% of UK serviced apartment operators say they remain committed to long-term expansion despite the uncertainty following the UK’s decision to leave the European Union.
The Operator Sentiment Tracker Survey (Summer 2016), conducted by the Association of Serviced Apartment Providers (ASAP) and Savills, also revealed that demand from the leisure sector for 2016 is expected to be up on 2015 levels with 44% of operators forecasting an uplift with an additional 44% expecting it to be in line with last year.
One-third of respondents are expecting a slight drop in occupancy and ADR for 2016 compared to 2015, while the UK is expected to be the key source market for the majority of operators for the rest of 2016.
Property/acquisition cost and stock/inventory availability are confirmed to be the most significant challenges the sector faces over the next three years, along with wider economic conditions.
James Foice, CEO of the ASAP said: “It’s very encouraging to see that while 2016 is proving to be a challenging year for operators in terms of the anticipated weakening in both occupancy and the average daily rate (ADR), there is overall optimism for the sector in the longer term. It’s especially good to see the majority of operators confidently continuing with their expansion plans post-Brexit.”