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September 6, 2017

Mixing Home and Hospitality – Higher rental income from Value Added Services

Service apartments have become an alternative stay option, especially for business travellers. The global developments in business had contributed to the upsurge of business travel. Business people in India travel frequently to other business hubs and spend some time there. Such long periods stay at hotels can be expensive and this paved way for the new idea of serviced apartments.

Serviced apartments give furnished accommodation with a kitchen and rooms. Unlike hotel rooms, they are more spacious and convenient. Corporate sector opt for serviced apartments than any. Apart from mainstream builders, small-to-mid size builders also see serviced apartments as an investment opportunity, expecting a return within the range of 9-14% per annum. As per present trends, investment in residential opportunity promises more capital value than rental income. Annual yield via rental income from a residential property is generally 3-4% a year while capital appreciation is 10-15%.

The sector of serviced apartments will gain more value-added services when the professional property management start offering services. It is expected that the demand for serviced apartments will increase with the development of Indian economy. When the demand rise, more developers in India will start offering serviced apartments either directly or in collaboration with hospitality firms. If you are a businessman and planning to invest in real estate, it would be good to diversify your area of business into services apartments. Serviced apartment offers higher annuity income than residential apartments.


Blog - september 1st week