Filippo Sona
Director | Head of Hotels MENA
Colliers International
IN A NUTSHELL (OCT 2015)
11 YEARS
PAYBACK
64,775
UNITS
15-17%
IRR
15,997
NEW
UNITS
US$ 160200k/Key
Cost
20-30%
BRANDED
Source: Colliers International
11 DAYS
AVR STAY
78.4%
OCC
60-65%
GOP
BUSINESS MODEL
REVENUE MIX
DYNAMICS
Serviced
Apartments
APART HOTELS
CORPORATE
HOUSING
BRANDED
RESIDENCES
ROOMS
90-96%
7-9 DAYS
30-90 DAYS
6-7 DAYS
4–
8%
F&B
4-8%
Source: Colliers International
• Grab & Go F&B
options & minimarts
• Retail connected
to properties to
increase appeal
GOP
2–4% 65%
Future Trends
• Increase in
duplexes & maid's
rooms to attract
GCC families
• Efficient room
designs – loft
inspired
ANCILLARY
• Moving to
suburban areas but
offer shuttles to
city centre and
access packages to
affiliated hotel
ROOMS
80-85%
4–
8%
F&B
11-14%
ANCILLARY
4-6%
GOP
60%
Supply
NUMBER OF KEYS & SHARE OF INTERNATIONALLY BRANDED SUPPLY - 2015
30
42%
25
Thousands
50%
47%
36%
20
40%
30%
31%
15
19%
10
2%
5
20%
20%
15%
10%
7%
2%
0%
-
-10%
Dubai
Abu Dhabi
Riyadh
Sharjah
Madinah Al Khobar Jeddah
& Dammam
No. of Keys
Manama
% of Internationally Branded
Doha
Kuwait City Muscat
Makkah
Supply
NUMBER OF KEYS & SHARE OF INTERNATIONALLY BRANDED FUTURE SUPPLY - 2020
35
30
25
20
15
10
5
-
120%
100%
Thousands
101%
74%
68%
19%
22%
31%
80%
60%
40%
8%
3%
29%
27%
5%
20%
15%
0%
Dubai
Abu Dhabi
Riyadh
Sharjah
Madinah Al Khobar &
Dammam
Jeddah
Manama
Doha
Kuwait City
No of Keys
% Increase of Internationally Branded
Muscat
Makkah
NO. OF PROPERTIES & AVERAGE
KEYS
HIGH
NUMBER OF
PROPERTIES
Dubai
Riyadh
Dammam
& Khobar
LOW AVERAGE
KEY COUNT
Abu
Dhabi
Jeddah
Sharjah
HIGH AVERAGE
KEY COUNT
Muscat
Madinah
Kuwait
City
Manama
Doha
Makkah
Cairo
Marrakesh
LOW
NUMBER OF
PROPERTIES
Source: Colliers International
SERVICED APARTMENT UNIT SIZE AVERAGE IN m²
Riyadh
Khobar &
Dammam
Jeddah
Studio
35
35
41
N/A
N/A
70
1 BR
56
60
60
35
35
135
90
2 BR
100
90
103
50
50
151
174
3 BR
126
134
139
75
75
Abu
Dhabi
Dubai
Sharjah
Studio
35
50
35
63
45
1 BR
65
68
65
75
2 BR
105
124
93
3 BR
127
173
105
Source: Colliers International
Doha
Kuwait
Manama
Muscat
GCC
Avg.
Singapore
Avg.
London
Avg.
Studio
40
50
43
43
28
1 BR
70
80
62
68
36
2 BR
147
130
101
95
50
3 BR
162
140
132
126
N/A
Makkah
Madinah
Demand Segmentation
GCC SERVICED APARTMENT DEMAND SEGMENTATION (2012)
100%
13%
4%
80%
60%
8%
4%
14%
11%
10%
7%
20%
16%
27%
48%
54%
46%
52%
34%
74%
72%
65%
39%
43%
42%
61%
60%
82%
40%
20%
46%
38%
15%
33%
0%
Makkah
Madinah
Jeddah
Damman &
Al Khobar
< 1 Month
Source: Colliers International
Manama
Muscat
1 - 6 Months
Doha
Kuwait City
> 6 Months
18%
75%
21%
11%
Riyadh
5%
20%
12%
Dubai
Abu Dhabi
Sharjah
Demand Segmentation
GCC SERVICED APARTMENT DEMAND SEGMENTATION (2015)
100%
10%
3%
5%
8%
11%
11%
7%
80%
87%
96%
94%
89%
85%
12%
16%
16%
15%
72%
72%
73%
Kuwait City
Dubai
Abu Dhabi
89%
88%
20%
12%
80%
15%
11%
0%
Riyadh
Makkah
Madinah
Jeddah Dammam & Manama
Al Khobar
< 1 Month
Source: Colliers International
12%
74%
60%
40%
12%
Muscat
1- 6 Months
Doha
> 6 months
Sharjah
Performance
GCC SERVICED APARTMENT PERFORMANCE, 2014
300
100%
250
80%
200
60%
150
40%
100
20%
50
0
0
Manama
Abu Dhabi
Doha
Jeddah
Kuwait
City
ADR (USD)
Source: Colliers International
Dubai
Dammam
& Khobar
Occupancy %
Riyadh
Makkah
London 2014 Occ%
Sharjah
Muscat
Madinah
Singapore 2014 Occ%
London
Avg ADR
Singapore
Avg ADR
Branded Residences
PHYSICAL
ATTRIBUTES
BRANDED RESIDENCES
PREMIUM
Over
standard residential units
World Famous Ultra Luxury Branded
HIGH
PREMIUM
•New construction
building
•Unique features
•Very good accessibility
41+%
premium
Luxury Branded
Developments
High- end Branded
Developments
21-40%
10-20%
premium
premium
Source: Colliers International
PRICE PREMIUM
Developments
SERVICES &
AMENITIES
IMAGE &
ASSOCIATION
•Five-star hotel services
•High-end restaurants
•Extensive luxury
leisure facilities
•Luxury spa
•Luxury brand
•Iconic building design
•Star Architect
•Famous building name
•High floor
•Exclusive development
•Prime neighborhood
MEDIUM
PREMIUM
•High-end finishing
•Branded quality white
goods and electronics
•Easy accessibility
•Hotel amenities
•Health club
•Spa
•Valet parking
•Boutique/lower tier
brand
•Unique building design
•Recognized architect
•Desirable views
•Renowned
location/neighborhood
LOW
PREMIUM
•Conversion building
•Communal facilities
(e.g. garden)
•Private parking
•24 h security
•Limited leisure facilities
•Professional architect
•Good
location/neighborhood
•Low floor
How to calculate premium
1
Identify four
categories of
key factors that
drive premium
3
2
1. Situation and Overall
Appeal
45%
2. Facilities and Amenities
10%
3. Design and
Specifications
15%
4. Branding
30%
4
Identify sub-factors
for each of the four
categories (drivers
of premium)
Weight the importance of
each category based on:
• Key factors commonly
driving premiums for
condo developments
(based on white papers
and primary/secondary
research)
• Local residential experts
opinions.
5
Score all subfactors with the
following scoring:
Low: 0 points
Mid: 10 points
High: 20 points
Prime: 25 points
Convert final score
into premium likely
to be achieved.
Guest Experience Index
81%
74%
Beirut
68%
Amman
72%
Creek &
82% 80% 81%Dubai
Festival City
Kuwait City
Alexandria
77%
73%
77%
Cairo
Aqaba
Manama
82%
Hurghada
79%
Sharm El
Sheikh
Jeddah
Sharjah
73%
77%
Al Khobar
Dubai
75%
Ras Al
Khaimah
72%
Fujeirah
73%
Riyadh
70%
70%
72%
Madinah
Source: Olery; Colliers International
Marina
JBR
Sheikh Zayed
Road & DIFC
58%
Makkah
75%
Doha
71%
82%
Doha Airport
& City Centre West Bay &
Diplomatic Area
82%
76%
Abu Dhabi
Muscat
SUMMARY: KEY FINDINGS ONLINE RATINGS (AUG 2015
ONLINE RATING: SERVICED APARTMENT BY
TYPE OF BRANDING (AUG 2015)
Overall
Unbranded
Locally Branded
Regionally Branded
Internationally Branded
Guest
Experience
Index
(GEI)
Room
Rating
Value
Rating
Service
Rating
Location
Rating
Cleanliness
Rating
74.9
83.1
82.0
81.8
83.4
80.3
73.
1
73.1
80.
7
80.7
79.
3
78.5
78.5
83.6
74.
5
74.5
78.6
82.0
85.2
82.6
79.9
79.9
80.2
78.1
81.4
74.
7
74.7
83.0
87.7
87.7
90.
3
90.3
84.0
84.
0
89.7
89.7
87.6
87.
6
88.3
88.
3
84.5
88.2
Best and worst by type of rating
Source: Olery, Colliers International
Note: Ratings are out of 100
Connected
to a hotel
provides
higher guest
rating
Top
Rated
Brands
Poor
Cleanliness
Int’l Brands
Offer Good
Value
Six of the 8 highest rated brands
with serviced apartment units
were hotel brands, or connected
to a hotel.
In August 2015, top rated brands for
serviced apartments were
Rosewood Residences, Residence
Inn, Jumeirah, W Hotels, Grand
Hyatt, Mercure, Staybridge Suites
and Shangri-La.
In KSA, UAE and Egypt, serviced
apartments have a lower cleanliness
rating than 3, 4 and 5-star hotels,
mostly due to poor management.
Internationally branded serviced
apartments are rated as higher
value than branded 3, 4 and 5star hotels.
Thank You