Ben Martin Describes How to Raise your Occupancy Rates by 10% and other Trends24 Jul 2017
AECOM Economics Senior Director Ben Martin describes what he is seeing as current trends in real estate and how properties can raise their average occupancy rates in this video.
Glenn Haussman: Welcome back to heretostay.tv brought to you by bridgestreet.com
I'm with Ben Martin, he's a senior director with AECOM. A tiny, little company with 92,000 people, but you guys are really experts on really helping, understand how all of the real estate components come together in a great mixed use facility. What are some of the trends that you're seeing right now to create that perfect product?
Ben Martin: Essentially, with a big mixture scheme you have the complexities of stuff that makes you lots of money. It doesn't necessarily look good and stuff that looks great may not make you lots of money, so a lot of what we do is helping people get the magic mix of components. Within that mix today, what we're seeing is a trend towards a combination of real estate and residential long stay and hotel. Not everybody wants just a one nights stay. People like me who are on business for two weeks, I don't need all the hotel stuff. Actually an Aparthotel works fine for me and there's a whole bunch of people just like me.
We don't care too much about the brand identity, we want something that works for us and the way we do our business.
Glenn Haussman: So an Aparthotel, the whole idea behind that is it's a kind of a hybrid between a regular hotel and an apartment type of living experience. I see in the hospitality industry when we're talking about pure hotels, multiple brand, duel brand, triple branded hotel buildings, you're taking this to the next level in the sense that, oh we can have more of that apartment type component, that fits in nicely with some of these other aspects of the real estate development.
Ben Martin: Yeah, there's an absolute blurring in the market with Airbnb coming in, brand is a little bit ... Well it's certainly very confusing today and I think essentially if you have a situation where you have your normal occupancy underpinned by people staying for a long term, then topped up by the short stays, then your average occupancy can be 10 percentage points higher, then it would be if it where a straight hotel. So your profit per square meter as a development and the return on your investment is going to be much stronger. Even if it may not necessarily be as glamorous, as one of the high class luxury hotel brands. In terms of an investment decision, there's a very strong argument.
Glenn Haussman: Right. Okay, so last question. I pretty much know what you're going to say with this but is there a magic formula or is every single property a beast unto itself?
Ben Martin: Yeah, I think the magic formula today is probably, first of all consider is just a straight hotel the right thing or should I be putting a hotel alongside a serviced apartment or an Aparthotel, because actually if you run the numbers, there may be a very strong argument for combining the two or running them parallel to each other.