When Australian singer-songwriter Andrew Tierney brought his family over from their home in Las Vegas to Sydney for his Human Nature tour, he faced the choice between taking a residential rental or staying in an apartment hotel.
He went for the hotel. “With rents so high now in Australia, the price was comparable,” he said. “We might have saved a bit of money with a rental, but I was happy to pay a little bit extra for the convenience.
“As well, we could stay right in the middle of the city, and have everything on our doorstep, plus use the gym and pool of the hotel. I didn’t have to sign a lease either, so we were much freer to decide to up and go at any time.”
It was unfortunate that wasn’t quite to be. Mr Tierney, 46, together with his wife Heather, 45, and their four-year-old daughter Violette ended up staying longer than they’d planned at Frasers Suites Sydney after being locked down as a result of the COVID-19 pandemic, with many of his tour dates postponed.
“But it’s an amazing place to be during a lockdown,” he said. “We have a balcony with 180-degree views and we can go for a walk to Darling Harbour or Barangaroo or around Mrs Macquarie’s Chair for exercise.”
The little family is among a fresh flood of people choosing apartment hotels over renting properties for their long-term sojourns in cities around Australia.
In Perth, for instance, mining and energy commercial manager Jon Cover has just left sister property, Fraser Suites Perth, after one day shy of a full 12 months. He also considered renting an apartment or house but decided to opt for the apartment hotel instead.
With rents for Perth houses having risen by 21.6 per cent over the past year, and apartments by 18.8 per cent, on the latest Domain Group figures, the difference in the prices was negligible. In addition, the vacancy rate of just 0.9 per cent – the tightest market in 40 years – meant there really wasn’t much choice available.
“I’d just spent four years in a mining camp in a remote area of the Pilbara, working on the $US37 billion Wheatstone Project producing LNG, so the chance to stay in an apartment hotel like that was a pretty nice experience,” said Mr Cover, 33, originally from the Gold Coast.
“We never quite know how long we’re going to be in one place so it makes more sense to stay in serviced apartments than taking out a regular rental. Even though I ended up staying so long, I knew I could cancel at any time and it was great to have access to that level of facilities.”
As a result of that uplift in domestic demand for longer stays, Fraser Suites is also pivoting its offering to service that new clientele. It’s introduced cheaper rates over certain time periods and a “Home Suite Home” package, asking guests in advance about their choice of pillows, what they’d like to have in the room, and food and beverage preferences, including Lite n’ Easy meals.
There are toiletries on arrival, booklets of recipes, grocery packs and offers to help with guests’ online shopping. Staff even threw Mr Cover a farewell party when it came time for him to finally check out.
“We’ve almost relaunched for a new market,” said Alexis Hvalgaard, general manager of Fraser Suites Perth. “The rental market is so constrained that people and companies are now much more inclined to look at accommodation in hotels instead. Long stay is what we do, too. It’s in our DNA.”
The pandemic boom in resources is providing a major fillip for many longer-stay apartment hotels. Pre-COVID-19, many workers were employed by their companies to fly in and fly out. Now, because of the unpredictability of state border closures, most of their firms are insisting they stay in one place.
With rents rising so fast across much of the country – in Darwin, for instance, house rents have grown by 20.9 per cent over the last year, and for apartments by 18.4 per cent – demand for serviced apartments has lifted apace.
At the Ramada Suites Zen Quarter Darwin, there haven’t been enough rooms to accommodate everyone trying to book them.
“We’ve had people moving up here to work, plus people coming to escape lockdown restrictions and a lot of holidaymakers,” said marketing manager Michelle Henson. “It was a huge influx of people.
“We had supply issues for rental property so a lot of people came here to stay. But then we had issues as we didn’t have enough rooms to honour the bookings we had for guests later on. So we were sitting at 98 per cent occupancy and had about 60 inquiries in three months we didn’t have rooms for.”
It’s becoming a similar success story for those serviced apartment hotels agile enough to take advantage of the changing market. Serviced apartments such as Peppers, Mantra and Sebel, run by Accor Pacific, have also implemented new long-term-stay deals.
“These spaces provide a more homelike experience for guests, with advantages that range from space and family-friendly options, to easier, healthier and less costly dining options and beyond,” said Simon McGrath, chief executive of Accor Pacific.
“They contain a kitchen and usually have separate lounge or dining facilities and the amenities mean guests also have access to additional luxuries and facilities, such as state of-the-art swimming pools, spas and fitness centres.”
Other cities, too, such as Adelalide and Canberra, have reported many more longer-stay guests.
“Staying longer has suddenly become more popular,” said Albert Pilarski, the general manager of Fraser Suites Sydney. “At various times, at least 50 per cent of our guests have been long-stay. That’s shifted quite dramatically.
“You would think they’re paying more than if they rented, but not much, and it’s the convenience, locations and amenities they’re choosing, along with not being bound by contracts, and we are working to create the idea of a home away from home.”
That’s certainly working for the Tierney family. “We love it here,” said Mr Tierney, who’s set to stay till the end of September when he returns to the US, whether or not he gets the chance to finish his tour.
“Downstairs from here, there are fabulous restaurants in the arcade, a supermarket over the road at World Square and everyone here is so friendly. We’ve never lived in a city before, and we’re really enjoying it. It’s a real culture of loveliness.”