Serviced Apartments

adjective / noun

The term serviced apartment was first coined back in the 1970’s, primarily to describe fa-cilities servicing the national corporate relocation market and the holiday market in Queensland. The product initially began as a response to a growing demand for apartment style accommodation for extended stays, incorporating a more residential feel along with facilities enabling the guests to look after themselves and be self-sufficient.

How are they different to other accommodation properties?

Serviced apartments are typically found in purpose built complexes with professional on-site management. Rooms typically vary from studios to two bedroom apartments, but all will contain


Food preparation areas

Catering facilities

The complex will either have laundry facilities within the rooms or in shared communal areas. Daily room servicing must be available but will not typically occur daily.

A snapshot of the serviced apartment industry in 2013...


In Australasia there are: Over 57,000 serviced apartments across 1,100+ locations with average revenues of $2.4M per outlet


Serviced apartment revenue constitutes about 26% of the revenue generated by the entire short-term accommodation sector, with motels holding a similar market share and hotels holding about 48%

Source: IBIS World Industry Report H4404

Paid salaries

50% of serviced apartment customers are business travellers, 32% come from the holiday market, 5% come from the government/public sector and another 13% come from ‘others’ such as airline crew stopovers and insurance stays

Serviced Apartment facts


of new short-term accommodation projects currently planned or under construction are serviced apartments.

The ability to strata-title properties has been critical to the development of the Australian serviced apartment industry. By offering a low entry point for private ‘mum and day’ buyers, serviced apartments have allowed a new classification of investor to enter a sector previously only accessible to high net-worth individuals and institutional investors

The reduction in the range of facilities normally offered to a hotel guest but not necessary for a serviced apartment guest, acts to minimise bottom line costs and enables greater flexibility in room rates and/or improved marginal returns for the operator

Without the general ‘brand standards’ of full service hotels (grand lobbies, restaurants, leisure facilities), construction costs in relation to income potential fall dramatically


Source: IBIS World Industry Report H4404

Over the last quarter century, a group of companies has grown to form the core of Australia’s serviced apartment sector

Quest Serviced Apartments have a specialist focus on catering for the corporate extended stay traveller and operate under a unique model where franchisees (typically mum and dads) purchase long-term leases and operate under the Quest banner

Mantra Group has experienced huge growth in recent years, largely though the acquisition of management rights and management/marketing agreements. They operate under three brands; Peppers, Mantra and Breakfree

Other key players in the sector include Oaks, Accor Hotels, Toga Hospitality, Mirvac Hotels & Resorts, Meriton Serviced Apartments, Q Resorts and StayWell Hospitality Group