The serviced apartment sector in Asia has witnessed vigorous growth since 2010 as the region led the global economic recovery following the 2009 recession.

The recovery also saw changing lodging patterns among corporate travellers as companies, seeking to cut costs, opted for serviced apartment accommodation over full serviced hotel options. Markets in Hong Kong and Singapore have remained strong while rapid growth has been seen in up and coming markets in, Indonesia, Thailand and Vietnam, where increasing demand has outstripped supply.

For Asia, the main cities catering to the serviced apartment guest include Shanghai, Beijing, Hong Kong, Taipei, Seoul, Brisbane, Melbourne, Hanoi, Manila, Bangkok, Tokyo, Yokohama, Osaka and Nagoya.

The Hong Kong expat market is booming as the financial sector relocates out of Japan following the tsunami and earthquake. The consequence of this has been a boosting rental market for serviced apartments, with occupancy rising as high as 98% and enquiries for average stays of four to five months.
Meanwhile in Singapore, where rental prices are at a 15-year peak, serviced apartments sector rates are rising between 5 – 10% per annum, with eight new serviced apartment buildings due to open in the city by 2015. With a very large expatriate population, demand for two and three bedroom apartments is particularly strong and typical lease terms are between two and three years.

The Indonesian market is growing rapidly owing to significant interest from foreign investors, up 52% in 2010, which is vital to expansion of the serviced apartments sector. With fewer than 4,500 serviced apartments in the capital and more than seven million international arrivals expected this year, serviced apartments have enjoyed average occupancy of 80% compared to 73% for hotels.

In Vietnam, there are 3,300 apartment units in HCMC and 2,250 in Hanoi. With demand coming traditionally from foreign workers, occupancy is down slightly as the number of Japanese coming to the city has fallen away since the March disasters. A recent trend is emerging however, in which wealthy Vietnamese nationals are entering the serviced apartment Market. It is expected that up to 15,000 apartment units will join the HCMC market and 17,000 units onto the Hanoi market in 2011.

The recently published Global Serviced Apartments Industry Report 2011-12, published by The Apartment Service Worldwide, shows a great potential for growth in all global regions and the sector can be optimistic about the future, because of much higher occupancies recorded as in traditional hotels.

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