2024EMEAPUBLICATIONIN ASSOCIATION WITH3GSAIR 2024:EMEA 2GLOBAL SERVICED APARTMENT INDUSTRY REPORT EMEA 2024 In association with our Platinum Sponsors:edyn,Oasis&The Oasis Private Collection,SilverDoorPublished by Ariosi Compiled by Travel Intelligence Networkwww.the- Designed in house at Ariosi Helen Ochoa DesignerDisclaimerWhilst every effort has been made to ensure accuracy,neither Ariosi nor Travel Intelligence Network can be held responsible for any errors or omissions.Confidentiality noticeCopyright 2024 by Ariosi(the Company).All rights reserved.This document or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the Company.The information contained within is strictly confidential and/or protected by law.If you are not the intended recipient of this document you must not make any use of this information,copy,store,disclose or show it to any unauthorised person.Report Methodology GSAIR EMEA 2024 has been responsibly compiled by undertaking extensive research using primary sources including conducting interviews and curating and collecting self-written pieces from contributors both in and closely aligned to the serviced apartment sector.For this edition we have focussed on primary sources,with secondary sources kept to a minimum.Where secondary sources are used,information sources are fully attributed.Unlock your teams potentialSeamless and cost-efficient L&D servicesROI Increased revenue opportunities are the result of motivated and empowered teams.Feedback Translating data into tangible next steps for continual improvement and career growth.Customised training,workshops,courses,coaching and mentoring that is tailored to your preferences.Insights and AnalysisTransforming your training needs into measurable learning outcomes that benefit your business.Free ConsultationDiscovery phase to learn more about your team,your SMART goals and business needs.Email us for a free consultation to discuss your L&D requirements.Ariosi is an accredited member of ITOL,supporting the development and delivery of current content and learner experience.Bespoke L&D 44(0)20 8168 TH GSAIR 11 EDITION5GSAIR 2024:EMEA4Acknowledgments and editorial teamPage 05Welcome and introductionPage 06Cost Management versus Assignee Satisfaction is there a perfect formula?Page 08Is your Serviced Apartment budget realistic?Page 10Building trust in Global Mobility and Business Travel technologyPage 14African trio a triple topic feature article,with Ren Stegmann Page 16Q&A with Dimitri Chandogin,President,NUMA GroupPage 20How the GCC extended stay market is changing Page 22Glossary of termsPage 24Directory listingsPage 26CONTENTSACKNOWLEDGMENTS AND EDITORIAL TEAMMARK HARRISSupporting EditorTravel Intelligence NetworkMark joined the business travel industry in 1990,has been a Director of Travel Intelligence Network since 2005 and originated GSAIR.He was voted the business travel industrys Personality of the Year in 2006 and has notched up four Business Travel Journalism Awards.TINs output includes over a million words in reports,white papers and blogs,co-creation of the Serviced Apartment Awards and hosting many others.After lunch,he is chairman of the PitchingIn Northern Premier League and an FA councillor.JOANNA CROSSChief Operating OfficerAriosiJoannas journey in the hospitality sector began at the Four Seasons Hotel in Sydney in 2001.In 2005,she moved to London and joined the team at COMO Metropolitan Hotel.Her interest shifted to serviced apartments in 2006 when she joined SilverDoor.Transitioning to the operational side of the sector in 2015,Joanna gained experience at both Supercity Aparthotels and Clarendon Apartments over the course of several years.In 2022,she rejoined Habicus Group and later in November of the same year,launched Ariosi Group Limited,a specialist serviced apartment consultancy.Many thanks to our GSAIR EMEA contributors whose time and input is highly valued.Our appreciation goes to:DIMITRI CHANDOGIN PresidentNUMA Group REN STEGMANNBusiness DevelopmentMyResidence.Africawww.myresidence.africaGUY WILKINSONOwner&DirectorViability Management Consultantswww.viability.aeNOURAN ZARROUGFounderNuLight Consulting JO WEBBHead of OrbiRelo(part of Ariosi Group)GEMMA WILLIAMSSupplier Network Manager,Corporate HousingSirva Worldwide,I7GSAIR 2024:EMEA 6SUCCESSFUL FORMULA In 2024 we struck upon a formula for our regional reports that was well received by our audience and that gave a tasty flavour to our regional pieces.We shied away from being just another source of industry news,and instead curated a series with guest contributors writing for us,from their perspective,in their own voice and words.Yes,they are opinion pieces,often supported by cold hard facts,but theyre real and lived experiences from a collection of specialists in various roles,across a selection of geographies,in our industry.We feel a handful of perspectives is just about right to ensure we deliver a collection of diverse,thought-provoking articles,with just enough content to stimulate our readership without being overwhelming.INFLUENCED BUT ALSO INDEPENDENTWhen deciding upon topics for inclusion,we were of course influenced by the findings of our main report,the GSAIR survey and results edition published in June 2024.However,we were open to new themes being introduced to enhance our breadth of opinion and keep things spicy.We did find that there is plenty of correlation between regions and general themes,so whilst it might not be ground breaking,it is indeed interesting to see how the commonalities we see and are experiencing as an industry are manifesting themselves at a regional and local level.GUEST CONTRIBUTORS DELIGHT AGAINIts always a pleasure to go through the process of sourcing our contributors,then deciding upon the topic(s)that light their fire,giving them a voice and concurrently serving the GSAIR readership community well.Jo Webb explores the fine line between cost and satisfaction and how best to manage the same in a complex temporary living program.Is there a perfect formula?With cost as a very pertinent and hot topic in 2024,Gemma Williams delves into budgeting,ROI and the value of understanding your accommodation product.Next we hear from Nouran Zarroug,a popular panellist at our GSAIR launch event earlier in the year,as to why building and retaining trust in business travel solutions is essential.Ren Stegmann takes us on a deeper dive with a triple topic feature with focus on her region of specialism,the vast,fascinating and ever evolving Africa.Switching it up slightly,we shift to a Q&A format with Dimitri Chandogin of serviced apartment operator NUMA,who successfully operates more than 7,300 units in 14 countries and 34 European cities,including Berlin,London,Paris,Rome,Milan,Madrid,Barcelona,and Vienna.Closing out GSAIR EMEA for 2024,Guy Wilkinson takes us for a quick spin around the rapidly changing and powerful Middle Eastern market,with focus on GCC.GRATITUDE AND GUSTOWere extremely grateful to our guest contributors who took on the challenge of being writers,with gusto.Its been a pleasure to engage and work with you all your enthusiasm for sharing your professional experience and expertise with us is delightful and we cant thank you enough for delivering the goods.THANK YOU!ENJOY,SEE YOU SOON To our GSAIR readers,enjoy,and we look forward to seeing you again for our next edition.If youd like to get involved,please get in touch wed love to hear from you!Welcome to our second year of regional sub reports first up is GSAIR EMEA!By JOANNA CROSSChief Operating Officer,AriosiWELCOME AND INTRODUCTION9GSAIR 2024:EMEA8Global Mobility Managers and Relocation Management Companies,(RMCs),face a challenging task:balancing the need to manage the costs of a relocation program whilst ensuring that each assignee has a positive experience and arrives at their new role refreshed rather than stressed.Temporary living arrangements,though often perceived as a minor component of the relocation process,are actually one of the most emotionally charged aspects and should never be underestimated.THE EMOTIONAL IMPACT OF TEMPORARY LIVINGConsider the situation from the assignees perspective.Before embarking on their relocation journey,they must take into account a wide range of factors:what do they know about the city they are moving to?Are there Jo Webb is Head of OrbiRelo,a platform that delivers a multi agent aggregator solution for Temporary Living.She shares her views and advice on managing the complexities of a multi-regional accommodation program.COST MANAGEMENT VS ASSIGNEE SATISFACTION-IS THERE A PERFECT FORMULA?Credit:Native EdinburghTHE DILEMMA:SATISFACTION VERSUS COST Lets consider a common scenario:an assignee is relocating to London with a partner,two children,and a dog.Their new office is in Central London,and they are looking for a three-bedroom property with parking close to the office,a potential new school for the children,and a place of worship.They have requested a property with outside space,a lift in the building,and ideally,an onsite gym.The average rate for a three-bedroom property in Central London that meets all these requirements is approximately 400 per night,while the London average for such accommodations is around 300 per night.This presents a critical question for the company managing the relocation:should they approve the more expensive property to meet the assignees requests,thereby ensuring high satisfaction,or should they opt for a more cost-effective solution that may not satisfy all the assignees preferences?What is the compromise here?WEIGHING THE OPTIONS:DATA INSIGHTS To make informed decisions,RMCs and Mobility Managers must carefully weigh the benefits and drawbacks of different approaches:1.HIGH-COST/HIGH-SATISFACTION APPROACH Advantages:Approving the higher-cost property that meets all the assignees requirements is likely to lead to high satisfaction.The assignee will feel valued,supported,and comfortable,reducing stress and increasing productivity.High satisfaction can also lead to better work performance and quicker adaptation to the new role and environment.Disadvantages:The primary downside is the significant increase in costs.For a standard three-month temporary housing period,the company could spend up to 36,000,compared to 27,000 if they opted for the average-priced accommodation.The additional 9,000 might be difficult to justify,especially if the relocation budget is tight.2.COST-EFFECTIVE/LOWER-SATISFACTION APPROACH Advantages:Opting for a more cost-effective property saves money,potentially freeing up resources for other parts of the relocation program,such as settling-in services or cultural training.This approach can keep the overall program within budget and demonstrates fiscal responsibility.Disadvantages:The assignee may experience dissatisfaction due to unmet needs,such as longer commutes,lack of desired amenities,or living in a less desirable area.This dissatisfaction can lead to increased stress,lower morale,and potentially even reduced productivity,which might offset the cost savings in the long run.There is also the increased risk of an unsuccessful relocation,which is the worst outcome for all concerned.3.A BALANCED APPROACH Advantages:A middle-ground approach might involve finding a property that meets the most critical needs of the assignee while compromising on less essential features.For instance,the company could prioritise a shorter commute and adequate space but forego amenities like an onsite gym or a highly central location.This could lead to moderate satisfaction levels while keeping costs relatively controlled.Disadvantages:While this approach can mitigate extreme dissatisfaction,there is still a risk that the assignee may feel unsupported if the compromises significantly impact their quality of life.CONCLUSION:IS THERE A PERFECT FORMULA?Balancing cost management with assignee satisfaction in temporary housing is a complex challenge,and while there may not be a perfect formula,there are strategies to get as close as possible.The key lies in understanding both the companys financial objectives and the assignees personal needs,and then finding a solution that respects both.Engaging a temporary living specialist can certainly assist and be invaluable in this process,providing the insights needed to make informed decisions that balance cost control with the well-being of the assignee.By focusing on what truly mattersboth for the assignees satisfaction and the companys budgetRMCs and global Mobility Managers can utilise this expertise to create a relocation experience that is as stress-free and successful as possible.Credit:Radisson Hotel&Residence Riyadh Olayaunsafe areas to avoid?Where will they find permanent accommodation?What are the commute options?Where are the nearest places of worship,schools,and supermarkets?Temporary housing is often the assignees first real experience of living in their new location.This period is typically the busiest and most stressful,involving settling into an unfamiliar environment,managing tired children,handling personal belongings,and quickly preparing for a new job in a foreign country with different cultural expectations.Moreover,the assignee must also begin the challenging task of finding permanent accommodation,enrolling children in schools,and ensuring the whole family is comfortableall while adapting to a new role at work.By JO WEBBHead of OrbiRelo,OrbiRelo(part of Ariosi Group)The key lies in understanding both the companys financial objectives and the assignees personal needs,and then finding a solution that respects both.11GSAIR 2024:EMEA 10At Sirva,we appreciate how essential competitive housing rates are for our clients,but how do we ensure we are getting the best rate or value?With some corporates still using 2018 accommodation budgets,it can be challenging to determine how far your money really goes now.In this article we explore:Why costs have risen,and by how much.Important factors outside of cost when sourcing corporate accommodation.The cost impacts of changing assignee and business traveller needs.How to get the best value from your budget.The value of educating clients and end users about serviced apartments.KEY FACTORS INFLUENCING SERVICED APARTMENT COSTS There are many factors and variables that influence the cost of a serviced apartment,many of which are determined by the global economic landscape.The cost of rent itself,which many not familiar with the complexities of serviced accommodation rates compare to the open,long-term market,is only a small portion of the overall cost.You also have to factor in vacancy rates,furniture,housewares,utilities,Wi-Fi,maintenance,as well as operator,staffing and technology development costs;costs which are often not visible to or considered by the end user.Over the last few years,we have seen increased costs from every angle in the UK for example,glassware and white goods costs were up 13%in 2022,an iron was over 22%more expensive,even hotel costs have increased 14%1.Utility bills have soared with gas prices up 129%in some regions in 2023,electricity prices up 67%2.We have also experienced increased costs of living common items found in apartment welcome baskets such as coffee or tea for example increased Here,Gemma Williams of relocation and moving specialist Sirva,explores the value of understanding the cost of a temporary accommodation program,and shares her top tips and strategies for overall program success.Credit:Your Amsterdam HousingCredit:edynBy GEMMA WILLIAMSSupplier Network Manager,Corporate Housing,Sirva(13%and 7%in the UK3)all of which continue to impact the serviced apartment landscape.Global inflation is set to fall in 2024,but it is not going away and will continue to impact cost models-as a rule of thumb,increases in serviced apartment rates typically mirror inflation.Whilst global economics are expected to continue to normalise and rate increases to subside,the activity of global economics over the past couple of years will likely ensure rates remain higher than they were a few years ago as providers look to recoup losses and recover.CONSIDERATIONS BEYOND COST As a result of the above,and continued COVID recovery within the industry,cost pressures have increased the need to diversify solutions which has enhanced interest in alternative accommodations or accommodation sourcing.Temporary corporate accommodations are not stored in a single global database;they are in thousands of buildings and locations around the world,and there is a myriad of accommodation types that formulate the product being offered to corporate guests already.This can be confusing when discussing serviced accommodation.With strengthening data privacy requirements,growing safety and due diligence concerns,and increasing global legislation changes attempting to regulate and tax the short-term rental market,it is more important than ever for corporate clients to have confidence that their needs are being managed by professionals who fully understand their unique requirements,challenges,and fully adhere to all regulations.Confidence in procurement and supply chain management is therefore critical to success;it is not just about who offers the cheapest rate.There are additional considerations alongside cost to factor in to serviced accommodation provision.Changing preferences brought on by hybrid work models mean guests are looking for more space.Changing location preferences,for example a longer commute,more suburban neighbourhoods,secondary or tertiary cities,or increased desk space(often for two occupants),as well as an increase in accompanying pet needs,have led guests to want an experience tailored to their exact circumstances and requirements more so than ever.Corporate budgets have not always kept up with changing guest demands or expectations.In addition,corporate relocation is seeing more competition for serviced accommodation products from business travellers and tourists;groups that can represent higher spend or profit margins.Environmental,Social and Governance(ESG)commitments will also continue to factor into corporate accommodation decision making.Reportable ESG statistics are important and will continue to develop how,where,and why certain accommodations are booked.Whilst we lack global standards within the serviced apartment industry at present,many aggregators and accommodation providers remain focused on this essential target.ESG reporting and selection will be a continued area of concentration for corporates and an area which I can really see as representing a growing differentiation for the serviced accommodation industry in comparison to the online marketplace competitors such as Airbnb,who are yet to spotlight on this scope.GETTING THE BEST VALUE FROM YOUR BUDGET How to get the best value from your budget goes hand in hand with the need to educate clients and end users about serviced apartments,aggregators,and the industry as a whole.Rates and estimates are complex as they are based on supply and demand principles and therefore subject to change.Rate comparisons are challenging-apartment providers can demand a different rate for each square footage,apartment type and floor location.There may be different operators within a building that may have similar units,but ultimately are not vetted or operated by providers that would comply with our scope of service.Rates can vary across even city locations due to variations in areas,desirability,etc;vary based on length of stay or depend on actual dates needed where large sporting or cultural events for example may impact.They are often projections based on booked values and historical data and need to factor in peak/off peak fluctuations to remove any disproportionate data.Budgets provided by data providers often fail to factor in these variances,fluctuations,and nuances which can ultimately impact budgets and in turn apartment quality and the guest experience.Our partners technology systems,alongside their human expertise,is critical to ensuring Sirva experiences the best possible rates.Within our partners technology systems,there is a mini bid or auction for every file initiated,creating dynamic and competitive markets among housing providers.These real-time auctions,where certified partners engage in competitive bidding,ensure transparency and fairness.It guarantees clients benefit from live competitive IS YOUR SERVICED APARTMENTBUDGET REALISTIC?1 https:/ 2 The Global Serviced Apartment Industry Report 2023 3 https:/ 2024:EMEA12Credit:Native Manchesterrates due to the bid system,while maintaining high-quality standards with trusted third parties.In turn,this provides clients with cost-effective housing solutions without compromising on quality,enhancing overall value.I cannot recommend enough the value of clients and buyers touring properties to achieve firsthand experience of what their budget achieves in reality,as this can often be very enlightening.In addition,the serviced apartment industry works differently across regions and even within a specific location,with much diversity and variation of accommodations making it challenging to talk about with consistency.Market awareness and product understanding therefore is a value add not to be underestimated for budget setting.STRATEGIES FOR COST-EFFECTIVE HOUSING Aside from product and industry awareness,there are a few general strategies to consider for more cost-effective housing.Strategies need to be tailored to individual client need and each comes with benefits,caveats,and challenges.Volume commitment:guarantees of and commitment to set volumes can often help secure competitive rates with specific providers.Expanding the search location:exploring less busy areas or those slightly further from the city centre can sometimes offer more cost-effective housing and value.Facility or unit inclusion evaluation:many guests want gym access within their housing which can increase cost and may not be necessary,for example,if gym access is available at the work site.Allowing communal instead of in-unit laundry facilities is another consideration that may result in lower rates in some markets.Turnkey leases:turnkey leases are a great strategy for cost-effective housing in locations where clients have frequent and repetitive volume.Sirva is fortunate to work with some fantastic partners that provide regular market updates and trend reports;educating us both internally and externally on what is often a very multifarious product and service line indeed I thank them for their contributions to my knowledge for this article.With all of this complexity,it is vitally important to keep clients informed about the industry which,in turn,helps to aid policy changes and budgetary reviews.It is crucial that all players,whether it be aggregators,apartment providers,or RMCs,are effectively collaborating to ensure that we are demonstrating value in the supply chain,providing excellent service,and bringing visibility to how clients can get the most from their serviced accommodation budgets.With all of this complexity,it is vitally important to keep clients informed about the industry which,in turn,helps to aid policy changes and budgetary reviews.15GSAIR 2024:EMEA 14Nouran Zarroug is the Founder of NuLight,a Consultancy within the Business Travel and Global Mobility sectors.Here,she emphasises the importance of building trust around technology and highlights why collaboration is essential for its long-term success.BUILDING TRUST IN GLOBAL MOBILITY ANDBUSINESS TRAVEL TECHNOLOGY By NOURAN ZARROUGFounder,NuLight Consulting In todays rapidly evolving,and at times uncertain,Global Mobility and Business Travel landscape,trust is the cornerstone for both brand reputation and long-term client loyalty.As technology continues to revolutionise the way we work,communicate,and conduct business;building and maintaining trust across our eco-systems becomes even more critical.Today,trust around Serviced Apartment technology has plenty of room for growth;with both Business Travel and Global Mobility managers frequently stating that there is insufficient transparency and a feeling of smoke and mirrors around the finer details.Could there be a disconnect between the claimed and actual capabilities of technology within the Global Mobility and Business Travel landscape?TRUST ISSUES Whilst we have seen significant advances within Serviced Apartment technology since the pandemic,there remains some trepidation even at times cynicism amongst some corporate buyers when researching suppliers within the space.Many have explained that they have been promised an all-encompassing technology solution,however in the cold light of day,this has rarely materialised.There have been extensive discussions around API connectivity offering access to vast amounts of inventory globally,bookings within seconds and instant confirmations.Whilst this certainly exists for some properties,the stark reality is that(for a wide variety of reasons)this is simply not the case for the majority.Many corporate buyers who manage global programmes have described that once implementation/integration has concluded(post RFP),the day-to-day reality has proved quite different.It is commonly known that well-established modern metropolises such as London,New York,Singapore etc can deliver speedy serviced apartments bookings through RMC and TMC interfaces,however,many of the tertiary cities seem to be heavily reliant on the back-and-forth email method.Furthermore,within the global mobility sector where stays begin at 30 nights and can go up to 12 months,bookings and the subsequent trails of emails take on a further layer of complexity.Not only are corporate buyers quickly realising this,but they are also openly discussing their experiences with their peers(most buyers will discuss their RFP shortlist with other buyers to compare and learn of their experiences before making a final decision on the successful supplier).Hence,overall trust has slowly been eroding and buyers are a little confused on what is realistic and possible today from a technology perspective.THE NEED FOR TRANSPARENCY As an industry that is facing a rollercoaster of volatility,now is the time to prioritise transparency above anything else when describing what is truly possible today versus the long-term vision.Only through this honesty and openness will we truly be able to both educate corporate buyers and build back trust around technology solutions.In fact,many corporates would go further and state the sheer refreshing honesty of suppliers would catapult them to the shortlist of preferred providers.The industry is aware of the challenges,specifically the biggest barrier being access to a centralised platform and distribution system that everyone can enjoy affordably.Additionally,agents and operators must navigate the fine tightrope of loading availability online,predicting lead times and most crucially,protecting longer stay opportunities that at times can come in very last minute!Rather than trying to mask these challenges or minimise the impact from buyers and competitors,we should encourage open dialogue and transparency and work towards broader solutions together.THE POWER OF HUMAN TOUCH Despite the urgent need for improved access to Serviced Apartment inventory and systems that speak to each other;we must never neglect the importance of human interaction when the moment requires.Often within the global mobility space,assignees and their families are permanently relocating to another country with a different language spoken and new cultural norms to navigate.Hence,lengthy detailed conversations with an advisor become even more crucial than APIs.For anyone that has experienced an international assignment;you will understand that as the panic sets in,it is the minutia that becomes the most reassuring aspect!In these circumstances,having access to an expert that can provide empathy and an emotional connection when employees are experiencing a heightened sensitive state,will go a long way in both supporting the assignee and developing trust with the corporate client or RMC.Additionally,the human touch provides an essential role in being able to discuss inclusive solutions for diverse populations who are relocating,i.e.advice around accessible apartments,LGBTQ friendly neighbourhoods etc.In essence,the human touch bridges the gap between efficient technology and the emphatic nuanced needs of extended stay guests.FOSTERING TRUST THROUGH AI With the AI revolution comes huge opportunities to reduce administrative workloads,provide predictive forecasting;and most importantly deliver sophisticated customisation and deep personalisation to both guests and clients alike.By using AI and machine learning algorithms,Operators and Agents can analyse client behaviour and regular Credit:Domus StayAs an industry that is facing a rollercoaster of volatility,now is the time to prioritise transparency above anything else when describing what is truly possible today versus the long-term vision.feedback to provide hyper-tailored apartment options.For example,by studying previous booking data,AI can suggest apartment buildings in specific locations that match the guests style and preferences yet still align with the companys travel/mobility policies,i.e.modern dcor,gym,pet friendly,3km from the office and under 250 per night etc.AI can then deliver confirmations and billing information in a format that is best suited to the clients internal HR systems.This enhanced level of personalisation will make clients,and their staying guests feel valued and understood,thereby strengthening trust and confidence in their supplier.However,it is always important to mention that ethical considerations are becoming increasingly scrutinised and hence the Serviced Apartment sector along with the full Business Travel and Global Mobility eco-systems must ensure that their usage of technology aligns with ethical standards,robust DEI practice,and respects client privacy.HUGE OPPORTUNITY AWAITS Industry-wide collaboration is paramount to successfully realising the opportunity that awaits.Frequent and transparent discussions amongst buyers,agents,operators,industry bodies and consultants,will not only ensure that the technology design and architecture is aligned with the future state vision,but will also support with educating corporate buyers.Painting a clear and honest picture of todays capabilities versus tomorrows utopia will re-build their trust in the sector and most importantly will re-engage their enthusiasm to join us on this exciting journey.This radical collaboration fuelled by continuous innovation that is deeply grounded in ethical practice,will ensure the Business Travel and Global Mobility eco-systems are not only future proof but perceived as trusted partners for decades to come.17GSAIR 2024:EMEA16Ren Stegmann is the founder of Relocation Africa(Pty)Ltd and of MyResidence.Africa Limited and has more that 30 years experience in the corporate relocation industry.She shares her extensive experience with us,via a triple topic feature article,with an African focus.By REN STEGMANNBusiness Development,MyResidence.AfricaCredit:edynCredit:Cheval Maison The Palm DubaiCHALLENGES OF MARKET ENTRY INTO THE SERVICED APARTMENT SECTOR IN AFRICA Launching a business in a new market is never without its hurdles,and when that market is as diverse and complex as the African continent,those challenges can multiply.My journey into the serviced apartment industry began overseas,where we successfully established our brand and customer base which provided the platform for five years of steady growth.When the time finally came to expand our customer base into Africawhere our products originated and where we recognised significant untapped potential although we anticipated challenges it was very interesting understanding those specific challenges entering into conversations with the travel management companies(TMCs).THE ROLE OF TMCS In the corporate travel industry,TMCs are pivotal players.These organisations manage everything travel related from transport logistics to accommodation arrangements for large companies,making them an obvious partner for a serviced apartment business like ours.As a founder of MyResidence.Africa,I took on the role of business development lead,attending numerous conferences and networking events,including meetings with key associations like Meetings Africa,the Global Business Travel Association(GBTA)Southern Africa,and the Africa Business Travel Association(ABTA).Our efforts introduced MyResidence.Africa to corporate clients in South Africa who require serviced apartments across the African continent.Despite these efforts,weve faced significant challenges in gaining traction as a service provider to the TMCs.A primary obstacle has been the expectation from TMCs that our serviced accommodation portfolio of 15,000 rooms should be instantly bookable through a System Interface or API to the TMCs booking platforms tools.While this expectation is understandable given the streamlined operations typical in more developed regions like Europe,Asia,and the Americas,it overlooks the realities of Africas serviced apartment sector and even globally,instantly booked serviced accommodation is not a reality.AN EMERGING CONCEPT Serviced apartments catering to the executive business traveller are still a relatively new and emerging concept in Africa.The industry on the African continent is not as established or technologically advanced as it is in other parts of the world.Yet,substantial property investments and developments in this area are paving the way for growth and investment opportunities.MyResidence.Africa is well-positioned with technology that effectively manages our growing inventory,backed by robust secure legal agreements along with curated relationships across our widespread network covering 54 countries.Additionally,we cater to a client base that cannot rely on other more consumer focused platforms like Airbnb or B,which do not offer independent vetting of the accommodation or services like pre arrival audits and non-compliance with security standards and requirement,which are critical for corporate businesses.Despite these clear advantages,and the prospect of paying a lower long stay rate,many companies still default to using non-compliant and expensive big name booking platforms,potentially risking the well-being of their business travellers and exposing themselves to gaps in their duty-of-care responsibilities.THE BIG QUESTIONS Are TMCs prepared to explore new ways of servicing their clients and to offer innovative solutions that align with the evolving needs of their clients?Agility is the buzzword and the challenge to TMCs is to be agile and explore a more cost effective and expansive offering to their clients.Should travel buyers within corporates actively seek out innovative solutions beyond the standard current offerings of TMCs?By doing so,these travel managers or travel buyers can push their TMCs to integrate new,more compliant options into their distribution systems.We also need to recognise the broader implications of this issue.While there is extensive discourse at industry conferences about diversity,equity,and inclusion,the barriers faced by new market entrants attempting to introduce innovative products highlights an inconsistency.TMCs,must evolve their practices and technologies to meet the changing demands of the market they serve.Ultimately,the success of corporate travel solutions in Africa depends on a collaborative effort between innovative providers and forward-thinking TMCs who understand that their role is to facilitate access to innovation,resulting in benefits to their clients.NAVIGATING NDC KEY INSIGHTS FROM A RECENT WEBINARMyResidence recently participated in a webinar focused on the evolving landscape of New Distribution Capability(NDC)and its implications for the African travel industry.The event provided a comprehensive overview of NDC,highlighting global successes and the specific challenges faced within the African market.The webinar aimed to offer valuable insights to delegates,including travel buyers,airlines,hotels,and TMCs,while simplifying NDC for those less familiar with it.NDC,launched by IATA,is a program designed to modernise and standardise how airline products are distributed.Globally,NDC has gained significant traction,but African adoption remains slow,with only six airlines currently on board.High costs,complexity,and lack of transparency are among the factors hindering its implementation.African airlines face significant challenges in integrating NDC.Each airline is developing its timeline for implementation,often through different technology partners,leading to new development work for each TMC.The complexity,high costs,and lack of transparency make the process difficult,highlighting the need for careful planning and support.Are TMCs prepared to explore new ways of servicing their clients and to offer innovative solutions that align with the evolving needs of their clients?AFRICAN TRIO-A TRIPLE TOPIC FEATURE ARTICLE WITH REN STEGMANN19GSAIR 2024:EMEA18HOW DO WE BALANCE RISK WITH SUSTAINABLE DEVELOPMENT IMPACTManaging risk is a topic we are all familiar with in business as it requires understanding the market,regulatory environments,and socio-political landscapes we need to navigate challenges like political instability,currency fluctuations,and infrastructure gaps.And as with many businesses around the world,we mitigate risk in our businesses by conducting market research,engaging with local partners,and we stay informed about regulatory changes.Understanding this we plan on various models of risk mitigation including diversification across regions and sectors or by investing in risk management frameworks,including insurance and contingency planning.SUSTAINABLE DEVELOPMENT IMPACT Understanding the Sustainable Development Impact of a business requires the same level of commitment and research to ensure the business you are involved with is a sustainable business that is considering all risks related to the environment,the social,and the governance pillars of the UN Global Sustainable Development Goals 2030.There is pressure in the serviced accommodation industry to ensure we are measuring carbon or that we are doing something to reduce the impact on the UN Sustainable Development Goals 2030.However,the industry doesnt understand what their impact on sustainable development is and the pressure should be both on understanding the topic of sustainable development as well as conducting a materiality assessment to understand what a particular business impacts.For example,a business that is a pure serviced apartment agency who operates as an aggregator will impact sustainable development differently to a serviced apartment business that owns properties.There will also be a marked difference in impact from a business in the United Kingdom versus a business in Africa.UNDERSTANDING AND LEARNING WITH INDUSTRY BODIES Understanding external factors like environmental regulations,climate change,and societal expectations is crucial for assessing how these affect business operations.Second,from the inside out view,companies must also consider their impact on local communities and the environment.This includes how much energy and water they use,how they manage waste,and the social impact of their operations.Industry organisations like the Corporate Housing Providers Association(CHPA)and the Greener Mobility Coalition are advancing the sustainable development conversation,supporting members and the broader Global Mobility community in aligning with authentic sustainability practices.By integrating risk management with sustainable development goals,businesses can navigate challenges while contributing positively to the planet and society.Credit:Dusit Thani Abu DhabiFor TMCs,NDC presents both opportunities and challenges.The complexity of integration,varying approaches by airlines,and high costs can be disruptive.Effective partnerships and collaboration are crucial for overcoming these barriers and embracing change.A case study from Kenya demonstrated successful NDC implementation through collaboration among airlines,TMCs,IATA,and travel agents.Addressing 12 key challenges led to greater acceptance,emphasising the importance of communication and collaboration.The discussion reinforced the need for enhanced collaboration,global best practices,and ongoing education to address the complexities of NDC.The webinar highlighted the need for stakeholders to work together,adapt to new technologies,and embrace change to maximise the potential of NDC in the African travel industry.KEY NDC TAKEAWAYS 1.African adoption of NDC is lagging,with transparency and cost issues as primary barriers.2.The complexity and costs of NDC pose significant challenges for TMCs.3.Successful NDC implementation relies on effective partnerships and collaboration.4.Corporates need transparency and clear information to support NDC integration.Short staysthat stand out from the crowdStaycations or work relocations whatever the reason for your clients visit,our dedicated guest services team will make the experience seamless.Choose from distinguished Notting Hill townhouses,Mayfair apartments and Kensington mews homes and leave us to sort the rest.Get in touch for more details:020 8168 8880/Understanding external factors like environmental regulations,climate change,and societal expectations is crucial for assessing how these affect business operations.21GSAIR 2024:EMEA 20Credit:Numa GER Nook BerlinNUMA operates more than 7,300 units in 14 countries and 34 European cities,including Berlin,London,Paris,Rome,Milan,Madrid,Barcelona,and Vienna.Below we hear more about their brand,growth strategy and lessons learned.Q&A WITH DIMITRI CHANDOGINPRESIDENT,NUMA GROUPWHAT IS NUMAS VALUE PROPOSITION AND ITS USPS?Headquartered in Berlin,NUMA Group is at the forefront of the European hospitality industry with a robust digital platform that is redefining the guest experience for the modern traveller.Our core value proposition focuses on delivering a seamless,technologically advanced stay in our stylishly designed apartments and boutique studios in Europes most desirable destinations.NUMA caters to a new age of travellers who seek both comfort and digital convenience,offering an experience that com-bines the authenticity of local living with the efficiency of modern technology.Our unique selling points are deeply rooted in our innovative approach to hospitality.First,our proprietary technology-based solutions automate most operational processes,and curating our guests stays from booking to check-out,enabling a contactless and seamless guest experience.For example,NUMAs AI Emma provides guests with service options before,during,and even after their stay.Emma can perform tasks such as rebooking guest reservations,helping guests request more in-suite amenities,and even providing location-specific recommendations and unit-specific details.Shes a digital concierge who never sleeps.This automation not only enhances the guest experience but also drives significant cost efficiencies.Second,NUMA is a trusted partner for investors,owners,and developers,leveraging our digital expertise and data-driven approach to boost property revenues and operational efficiencies across more than 7,300 units in prime European locations.With a focus on technological innovation and exceptional guest experience,NUMA is uniquely positioned to pioneer the next generation of hospitality services in Europe.HOW DO DEMAND AND CUSTOMER NEEDS VARY BETWEEN YOUR DIFFERENT EUROPEAN LOCATIONS?Weve observed nuanced differences in demand and customer needs based on location.Our strategy is tailored to embrace these differences,ensuring that we meet local expectations while maintaining our overarching brand standards.In cities like Berlin and Barcelona,theres a significant demand from younger,tech-savvy tourists and business travellers who prioritize digital convenience and stylish,functional spaces.These travellers value our automated services and contemporary design,using our properties as hubs to explore vibranturban cultures.Conversely,guests often seek a blend of modern comfort infused with local character in more historically rich cities like Rome and Paris.Here,the demand extends to deeper cultural engagements and bespoke experiences,which we cater to through curated digital local NUMA guides.Moreover,business-focused locations such as Frankfurt exhibit a higher demand from corporate travellers,who require streamlined,efficient stays with strong connectivity and flexible workspaces.Understanding these guest profiles allows NUMA to effectively tailor our offerings to meet a broad range of needs.This approach enhances guest satisfaction and optimizes our operational strategies across different markets.HOW HAVE YOU DELIVERED A BRANDED PRODUCT WITHOUT COMPROMISING REGULATORY COMPLIANCE OR BRAND INTEGRITY?At NUMA,maintaining regulatory compliance and brand integrity while delivering a branded product is central to our operating philosophy.We have established a robust framework to ensure that all our properties across various European cities comply with local laws and regulations without sacrificing the elements that define our brand.We achieve this through meticulous compliance with local regulatory requirements across our entire property portfolio.Our technology platform is designed to be adaptable,allowing us to tailor operational processes to meet specific local standards.For example,our automated check-in systems comply with local security regulations by incorporating required data protection and identity verification processes.As we expand into new markets,a key area of focus is prioritizing and anticipating transparency to stay ahead of any regulatory changes and ensure that our operations remain compliant,is a key area of our focus.Doing so protects our brand integrity while delivering a seamless and compliant hospitality experience to our guests and local regulations.WHAT IS YOUR EXPANSION STRATEGY,AND HOW DO YOU BALANCE EXPANSION OPPORTUNITIES AGAINST LOCAL MARKET COMPLEXITIES?Our expansion strategy is carefully crafted to balance robust growth with the intricacies of local market dynamics.We target European A-cities with a confluence of tourism,business activity,and cultural significance,ensuring a steady demand for our innovative hospitality solutions.To effectively navigate local market complexities,we employ a two-pronged approach:meticulous data-driven market analysis and strategic partnerships.Before entering a new market,we conduct in-depth research to understand local consumer behaviour,regulatory landscapes,and competitive scenarios.This allows us to tailor our offerings to meet specific local needs and expectations while remaining consistent with the NUMA brand.Strategic partnerships with local investors,property owners,and developers are pivotal.These collaborations provide valuable insights into the local market and facilitate smoother market entry and operations.Our partners benefit from our proprietary technology and operational expertise while we leverage their local knowledge and networks.Furthermore,our operating model focuses on scalability and flexibility to quickly adapt to new markets.A solution-oriented and data-driven approach is adaptable to regulatory requirements and local cultures,securing our strategic competitive advantage.Through this balanced approach,NUMA effectively expands while respecting and adapting to the nuances of each new market.WHAT LESSONS HAVE YOU LEARNED ON YOUR JOURNEY TO DATE?Our journey in revolutionizing the hospitality industry with digital solutions has been both challenging and enlightening.Several key lessons have shaped our approach and strategy.First,guest obsession stands at the forefront of our thinking in every aspect.We want to ensure that every stay is not just a visit but a memorable experience for our guests.Second,the importance of adaptability cannot be overstated.The hospitality sector is dynamic,influenced by technological advancements,changing consumer preferences,and unforeseen global events like the COVID-19 pandemic.Our proven ability to swiftly adapt our operations and business model to these changes has been crucial for our resilience and continued growth.Third,a deep understanding of local markets is vital.Each city has its unique regulatory landscape,cultural nuances,and consumer behaviors.Embracing these differences rather than adopting a one-size-fits-all approach has allowed us to effectively tailor our offerings.And finally,technology is a powerful enabler,but it must be people-centric.Our investments in technology have significantly enhanced operational efficiency and guest experiences.However,focusing on interaction and personalized service has proven critical to ensuring guest satisfaction and loyalty.These lessons have been instrumental in guiding NUMAs decisions and strategies as we continue to grow.23GSAIR 2024:EMEA 22With 5,660 serviced apartment buildings in 20194,the Kingdom of Saudi Arabia still has by far the largest inventory of extended stay properties in the Gulf Cooperation Council(GCC)bloc,also comprising Bahrain,Kuwait,Oman,Qatar and the UAE.HOW THE GCC EXTENDED STAY MARKETIS CHANGING By GUY WILKINSONOwner&Director,Viability Management ConsultantsCredit:Dusit Thani DubaiCredit:Bree Street ApartmentsBy comparison,the Kingdom had 2,621 hotels in the same year5,reflecting the Saudis preference for such apartments.Often comprising small buildings containing just a handful of furnished units and neither facilities nor services(40 per cent of the serviced apartments were rated Fourth Class6),they were historically somewhat akin to a bed and breakfast in the UK,but with an emphasis on multiple-bedroom units and guest privacy that Saudi families value highly.Above this large number of owner-operated,economical serviced apartments are two major midscale domestic serviced apartment chains in Saudi Arabia,Al Muhaidb with 42 properties and Boudl with 33.Above those again are relatively few branded properties operated by the large international chains,such as Marriott Executive Apartments(four),and two existing buildings each of Adagio,Ascott,Novotel Living,Radisson Blu and Residence Inn.The other single-property global serviced apartment brands at the top of Saudi Arabias still fledgling market comprise Citadines,DoubleTree,Fairmont,Fraser Suites,Hilton,Hyatt House,Movenpick,Somerset and Swissotel Living.A number of these branded properties are twinned with full-service hotels.Those brands are also present in similarly limited numbers throughout the other major GCC cities,from Manama to Muscat,with one notable exception.MOST ADVANCED MARKETDubai in the UAE is another matter.The GCCs most advanced city market,it boasts a 2024 supply of 193 hotel apartment buildings7 as they are called there,including 83 Superior and Deluxe properties,and 54 that are internationally branded.At the 5-star level,brands such as Grand Hyatt,InterContinental,Kempinski,Ritz-Carlton and Shangri-La all offer impressively luxurious serviced apartment options,as do Dubai-based international brands Armani,Damac Maison,Jumeirah Living,Palazzo Versace and The Address.Local mid-to-upper-upscale serviced apartment chains like Auris,City Seasons,Flora,Golden Sands,Grand MidWest,Jannah and Rotana compete on an even footing in terms of quality with the likes of Adagio,Element,Ramada and Residence Inn.But it is the business models introduced in Dubai that make its serviced apartments market stand out.Dubai opened its housing market to foreign ownership only in 2002 until then,expatriates could only rent houses and apartments from their Emirati owners.Combined at that time with the UAEs secure,tax-free lifestyle(there are some taxes now),this resulted in an explosion in freehold developments that has continued to this day.Many apartment buyers wanted to rent out their individual flats to tourists,so in 2013 the Dubai Department of Tourism&Commerce Marketing(now Department of Economy&Tourism)introduced guidelines to allow and regulate holiday homes lettings through Airbnb.Condo apartments(a term from the US hotel industry that refers to serviced apartments that are individually sold freehold and then effectively leased back by their owners to a hotel operator)have been available in Dubai since 2004,when leading local master developer Emaar launched its first such towers using this business model.Those were The Address hotel/serviced apartment complexes at Dubai Mall(two hotels,one of which was recently reflagged as the Kempinski Central Avenue Dubai)and Dubai Marina Mall(now JW Marriott Hotel Marina).DEVELOPER BENEFITSFor developers,the main advantage of this model is the ability to sell a buildings full stock of apartments off-plan,thus ensuring the project is paid for the day it opens.For investors,condo apartment income derived from serviced apartment operations is typically higher than annual residential rent.As a result,Dubai has seen more than 1008 serviced apartment buildings and hotels developed using this approach,and phenomenal unit sales that not even COVID could slow down,to buyers as far afield as the Subcontinent,Nigeria and China.In a 2021 report by global property advisory firm Savills,Dubai was ranked the top city market in the world for development of branded residences,with almost 60 existing and pipeline projects,followed by Miami with 45 and New York with 30.Routinely used as a synonym for condo apartments in the GCC,the term refers to residential apartments or houses that are branded by a hotel chain or a retail brand.When unit owners in such projects want to lease out their units to generate income,it should in principle be on the residential market,but in reality,the term encompasses rental pools with hotel-style condo apartment operations Among the plethora of exalted hotel brands in Dubais branded residential sector are 25hrs,Armani,Andaz,Biltmore,Bulgari,Mandarin Oriental,One&Only,Paramount,Raffles,Royal Atlantis,St.Regis,Six Senses,SLS,S/O,The Dorchester and W.Complementing those are fashion brands Cavalli,Elie Saab,Fashion TV,Fendi,Jacob&Co and Missoni and car brands Aston Martin,Bentley,Bugatti,Lamborghini,Mercedes Benz and Pininfarina.COLIVINGSo buoyant is the Dubai property market at the time of writing that new phases of residential developments can sell out in a matter of hours,regardless of their often-exorbitant prices.On the cutting edge of serviced apartment evolution in Dubai,HIVE Coliv is the citys self-proclaimed first true coliving project comprising 120 studio,1,2,3 and 4 bedroom apartments.The owner-operator explains the concept thus:“Ten years ago,coliving was what happened when you couldnt afford to rent your own place.For the conservative GCC with its majority Muslim populace,colivings proposition of sharing an apartment with a total stranger albeit each with their own bedroom is radical.Today coliving is a conscious lifestyle choice offering the best of both worlds your own private apartment with access to communal facilities you wouldnt otherwise be able to enjoy,in a community of like-minded people.”Public area amenities at this upscale property,where one month is the minimum length of stay,include a caf,gym,pool,library,gaming room,open-air cinema and coworking space.For the conservative GCC with its majority Muslim populace,colivings proposition of sharing an apartment with a total stranger albeit each with their own bedroom is radical.In its most cosmopolitan city,Dubai,no alarm bells have been rung.But with operators of such brands as Lyf by Ascott now in discussions with developers in the Kingdom,it will be interesting to see just how fully the concept will be embraced,or whether regional adjustments will be needed.4 SCTA MAS 5 Ibid 6 Ibid 7 https:/www.dubaidet.gov.ae/en/research-and-insights/tourism-performance-report-may-20248 Viability Management Consultants 25GSAIR 2024:EMEA24GLOSSARY OF TERMS ADR:Average Daily Rate.Agent:Used more generally to describe an intermediary,either individual or company,booking travel or accommodation on behalf of another party.AI:Artificial Intelligence.APAC:Asia-Pacific.Aparthotel:Fully furnished and equipped apartments,which include hotel services such as manned reception and cleaning.Typically used for shorter stays and suitable for business and leisure use.API:Application Programming Interface.ASAP:Association of Serviced Apartment Providers.Assignment working:A short or long term stay,undertaken to perform a specific task or project based trip.Stays can last between 30 days and three years and are temporary,whereas Relocation(see below),is permanent.Assignment workers are often referred to as assignees.Business travel:Journey specifically taken for work purposes,usually but not always up to seven days.Business travel excludes daily commuting,leisure trips or holidays.CHPA:Corporate Housing Providers Association.Co-living:Co-living refers to accommodation where multiple unrelated people can live together.Units usually contain large communal spaces as well as private bedrooms.Developments often feature social areas and programmes designed to foster a sense of community.Corporate housing:Residential apartments,packaged up to include servicing and bills,typically bookable for a minimum of 30 nights,either let and maintained by the operator on an ongoing basis or rented specifically for a particular housing requirement and length of time,after which they are handed back to the owner.Corporate housing is also the term used in the U.S.to describe serviced apartments.CRM:Customer Relationship Management.DE&I:Diversity,Equity,and Inclusion(also referred to as EDI).DSP:Destination Service Provider.EMEAEurope,the Middle East,and Africa.ESG:Environmental,Social,and Governance.F&B:Food and Beverage.FTSE:Financial Times Stock Exchange.GCC:Gulf Cooperation Council.GDPR:General Data Protection Regulation.GDS:Global Distribution System(e.g.Amadeus,Travelport,Sabre).Gen Z:Generation reaching adulthood in the second decade of the 21st century.GHG:Greenhouse gas.GSAIR:Global Serviced Apartment Industry Report.Homestay:Generic term for products like Airbnb,or home rental.IATA:International Air Transport Association.ITM:Institute of Travel Management.LOS:Length Of Stay.M&A:Merger and Acquisition.NDC:New Distribution Capability.OBT:Online Booking Tool.Occupancy:Percentage of occupied bedrooms/apartments during a set period.OTA:Online Travel Agent(e.g.Expedia,B).PMS:Property Management System.QR:Quick Response(commonly referred to as QR code).Relocation:Relocation(also referred to as Relo),involves permanently moving an employee,and family,to another city or country.RevPAR:Revenue Per Available Room.RFP:Request For Proposal.RMC:A Relocation Management Company provides outsourced relocation logistics management for organisations of different sizes and needs.ROI:Return On Investment.Serviced living:Generic term to describe the expanding number of emerging extended stay concepts.Fully furnished accommodation including kitchen facilities,with some private and communal spaces.TMC:A Travel Management Company manages the business travel requirements of an individual or organisation,in line with their corporate travel policies,where relevant.Several acronyms or abbreviations are used in this report.These are as follows:GSAIR 2024:EMEA 2627Adagioadagio- 33(0)1 55 26 32 00 Discover Adagio.The city made easy in comfortable flats with services included.Choose from over 125 aparthotels in the heart of the cities.AptsLatam 57 320 339 7773AptsLatam,an award-winning provider of corporate housing and serviced apartments in Latin America and the Caribbean,offers tailored solutions and first-class support for single and group moves,ensuring a seamless experience.A 44(0)20 8168 8168A specialist serviced apartment consultancy and the home of OrbiRelo and GSAIR.We aspire to be the place you come to access accurate and up to the minute insights,advice,support,and training resources.Astra Apartments .au 61(0)2 8231 6624 Since 2001,Astra Apartments has specialised in creating better experiences for extended stays.Our urban footprint extends over 550,full-sized corporate apartments in major cities across Australia and New Zealand.dluxSuites 1 248 676 0876We are redefining corporate furnished housing by curating memorable experiences one luxury stay at a time.Domus S 44(0)20 8168 8880Short stays with a difference.Domus Stay brings together exceptional,design-led homes across London with dedicated guest services and handpicked experiences from its black 44(0)117 242 0492Edyn combines boutique hotel design with serviced apartment flexibility in a trailblazing aparthotel concept,creating vibrant,local experiences.The hybrid approach meets modern travellers needs,defining the future of serviced apartments.Hybrid Resi 44(0)20 3488 2904We are a UK-based company offering serviced apartments in Greater London.Our modern,fully furnished accommodation combines hotel conveniences with extra space,comfort,privacy,and amenities like split-screen monitors for remote work.Mansley Serviced Apartments 0800 304 7160Mansley Serviced Apartments currently operate seven properties across London,Edinburgh,Inverness&Cheltenham.Oasis 44(0)20 3608 1863(International HQ) 1 813 489 5144(US HQ)As a leading global temporary housing agency Oasis connects you with over 600,000 units.Our dedication to quality control and ongoing service throughout ensures you always have an extraordinary stay.OrbiRelo 44(0)1524 428 298 A versatile multi-agent aggregator platform which specialises in temporary living accommodation solutions.Access to over 1 million temporary living properties globally via multiple agents.Powered by technology.Superpowered by humans.PREMIER SUITES 44(0)151 227 9467Spacious serviced apartment living in 15 hand-picked city destinations.Ireland United Kingdom Continental Europe Bringing home a little closer.SilverD 44(0)20 8090 8090The worlds leading corporate accommodation agent providing businesses across the globe with an unrivalled service and intuitive technology for an outstanding booking experience.The Residence 44(0)20 7052 4527 The Residence offers modern,spacious serviced apartments with sleek interiors,equipped kitchens,and luxurious queen beds.Centrally located in London for business,relocation,or vacation.Your home away from home!DIRECTORY LISTING 29GSAIR 2024:EMEA 28A versatile multi-agent aggregator platformwhich specialises in temporary living accommodation solutions.Powered by technology.Superpowered by Temporary Living Technology Multi Agent SolutionAccess to over 1 million temporary living properties globally via multiple agents.Global LeadersAward-winning global team with decades of experiencein temporary living.Money Saving Experts Competitive pricing,cost savings,and solution diversity.Never compromising on quality.SanctuaryAMSTERDAM|BERLIN|CAMBRIDGE|DUBLIN|EDINBURGH|THE HAGUE|LISBON|LIVERPOOL|LONDON|MANCHESTER|MUNICH|ZURICHedyn is pioneering a new era of hospitality,blending the comforts of home with the amenities of a hotel.The company develops,owns,and operates an expansive portfolio comprising 3,468 keys across 23 properties in prime locations.The Locke brand boasts 2,875 keys and 16 properties,while the Cove brand encompasses 593 keys and 7 properties.With a focus on design,technology,and exceptional service,edyn offers a truly unique and enriching experience,redefining the way we live,work,and explore our cities. 44(0)117 242 0492|salesedyngroupSoulful hospitality and sanctuaries.Wittenberg by Cove Plantage|AmsterdamEmber Locke Kensington|LondonTuring Locke Eddington|CambridgeCove Centrum Passage|The HagueCove Landmark Pinnacle Canary Wharf|LondonWunderLocke Sendling|MunichGSAIR 11 EDITION TH trusted guide to the serviced apartment industryCREATED WITH CARE,BY INDUSTRY EXPERTS,WITH REAL EXPERIENCE
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PUBLICATIONIN ASSOCIATION WITHTH11 EDITION20243GLOBAL SERVICED APARTMENT INDUSTRY REPORT 2024 In association with our Platinum Sponsors:edyn,Oasis&Oasis Private Collection,SilverDoorPublished by Ariosi Compiled by Travel Intelligence Networkwww.the- Designed in house at Ariosi Helen Ochoa DesignerDisclaimerWhilst every effort has been made to ensure accuracy,neither Ariosi nor Travel Intelligence Network can be held responsible for any errors or omissions.Confidentiality noticeCopyright 2024 by Ariosi(the Company).All rights reserved.This document or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the Company.The information contained within is strictly confidential and/or protected by law.If you are not the intended recipient of this document you must not make any use of this information,copy,store,disclose or show it to any unauthorised person.Unlock your teams potentialSeamless and cost-efficient L&D servicesROI Increased revenue opportunities are the result of motivated and empowered teams.Feedback Translating data into tangible next steps for continual improvement and career growth.Customised training,workshops,courses,coaching and mentoring that is tailored to your preferences.Insights and AnalysisTransforming your training needs into measurable learning outcomes that benefit your business.Free ConsultationDiscovery phase to learn more about your team,your SMART goals and business needs.Email us for a free consultation to discuss your L&D requirements.Ariosi is an accredited member of ITOL,supporting the development and delivery of current content and learner experience.Bespoke L&D 44(0)20 8168 TH GSAIR 11 EDITION5GSAIR 20244Report methodologyPage 05Editorial teamPage 07AcknowledgmentsPage 08Glossary of termsPage 10Welcome and introductionPage 12Top 10 trends driving the serviced apartment industry in 2024Page 13GSAIR survey and results analysisPage 15Serviced apartment volumesPage 16Length of stay and rates Page 19Usage trendsPage 21Why serviced apartments(any why not)?Page 23Sourcing Page 24Programme performance metrics Page 27Sustainability Page 28AutomationPage 32Supply Page 33Categorising and quantifying the serviced apartment marketPage 34Hot seat with Steve Lowy of The ResidencePage 37What changing traveller and assignee needs mean for corporates and operatorsPage 38Case study why making it easy is the key to compliancePage 41Serviced apartments the next phase of evolutionPage 42Case study why technology is the key to great content Page 46Corporate housing overviewPage 47How the serviced apartment industry is driving ESG Page 50AI why theres no need for panicPage 52Hot seat with Stuart Winstone of SilverDoorPage 56Long term future of serviced apartmentsPage 58Hot seat with Steve Frey of Oasis Page 61The last wordPage 62Top destinations and ratesPage 64Directory listingsPage 72List of tablesPage 74The 2024 edition of the Global Serviced Apartment Industry Report has been responsibly compiled from annual proprietary research and selected secondary sources,both in and closely aligned to the serviced apartment industry.The bulk of this report is based on data from the dedicated survey undertaken especially for this report.This was conducted during March and April of 2024 amongst a perpetually refreshed and consolidated database of 3,000 corporate buyers,serviced apartment operators and agents.The surveys findings were then presented to,and discussed with leading corporate buyers,agents,and operators in a series of one-to-one interviews conducted in April and May 2024.Although the questions posed in this years survey have been updated to reflect current market trends,comparisons with previous years have been included to highlight trends where appropriate.For this edition,we have focused on primary sources,with secondary sources kept to a minimum.Where secondary sources are used,information sources are fully attributed.REPORT METHODOLOGYCONTENTSCredit:Oasis Private Collection7Joanna CrossChief Operating Officer,AriosiJoannas journey in the hospitality sector began at the Four Seasons Hotel in Sydney in 2001.In 2005,she moved to London and joined the team at COMO Metropolitan Hotel.Her interest shifted to serviced apartments in 2006 when she joined SilverDoor.Transitioning to the operational side of the sector in 2015,Joanna gained experience at both Supercity Aparthotels and Clarendon Apartments over the course of several years.In 2022,she rejoined Habicus Group and later in November of the same year,launched Ariosi Group Limited,a specialist serviced apartment consultancy.Mark HarrisContributing EditorMark joined the business travel industry in 1990,has been a Director of Travel Intelligence Network since 2005 and originated GSAIR.He was voted the business travel industrys Personality of the Year in 2006 and has notched up four Business Travel Journalism Awards.TINs output includes over a million words in reports,white papers and blogs,co-creation of the Serviced Apartment Awards and hosting many others.After lunch,he is chairman of the PitchingIn Northern Premier League and an FA councillor.Shani ClarkeClient Manager,AriosiShani began her journey in the serviced apartment industry in 2013 with SilverDoor,joining their Account Management team.Working from the ground up,she quickly learnt about the extended stay and corporate housing industry advancing her to the position of Account Manager where she led a team catering to global mobility and travel management clients.Her career progressed as Sales Manager at the London-based property operator Cycas Hospitality.Now,with over a decade of experience,Shani is Client Manager at Ariosi Group Limited,utilising her diverse expertise to support all areas of the business.EDITORIAL TEAMAlice BazziMarketing Manager,AriosiAlthough new to the serviced apartment industry,Alice holds substantial experience in marketing and content strategy.Having recently finished her Diploma in Professional Marketing with The Chartered Institute of Marketing,she has developed marketing and content strategies in the Tech and Publishing industries,showing a strong interest in start-ups.Alice now oversees all marketing and content aspects at Ariosi,drawing on her extensive experience to drive projects forward.Alison WillisGSAIR Project Manager,AriosiAlison began her career in the industry 22 years ago as a placement student with Holiday Inn.Her journey has since included working in all elements of the business travel and meetings industry.Including hotels,venues,and agencies.Alison also led the partner relationships team at SilverDoor from 2016-2018.Most recently Alison was a Senior Client Programme Manager for SilverDoor,managing a portfolio of global clients and their business travel and mobility programmes.In 2024 she brought her wealth of industry knowledge and long-standing corporate relationships to GSAIR.9GSAIR 20248ACKNOWLEDGMENTSAlex Neale Senior Vice President Partner Relationships SilverDoor Andrew Meadowcroft Vice President Customer Experience Aires Barbara Hale PresidentdluxSuites Ben Davis Co-founder Saxbury Carlos AlmendrosGlobal Travel&Card Category Manager CiscoCatherine Chetwynd Journalist and Copywriter Chad M Keiser Global Category Manager Graebel Chris Orme Global Director of Sales and Business Development edynClaire Barrie Executive Vice President,Sales&Marketing Synergy Global Housing Daniel Cockton VP Global Travel Services Wood PLCDaniel Simmons Chief Commercial Officer HotelREZDavid James Wright Portfolio Development Manager&Sustainability Officer Mansley Serviced ApartmentsDuncan AdamsManaging Director Astra ApartmentsDusko KainCorporate Land Supply Manager EMEA Flight Centre Travel Group Evelyn Haran COO(UK)and PREMIER SUITES Brand Standards Manager Europe PREM GroupGuillaume Gerard Head of European Corporate Sales Adagio Aparthotel Gavin Carruthers Partner Relationship Lead-EuropeK2 Corporate Mobility Hanish VithalChief Information and Technology Officer SilverDoorJames Foice CEO The Association of Serviced Apartment Providers(ASAP)John AngusManaging Director Switch ManagementKaren HutchingsFounderCobb&Hutch ConsultingKatie Garrahy Senior Client Programme Manager SilverDoorLeanne FowlerDirector of Account Management Clarity Business Travel Max SlaghtCo-FounderDomus StayRick Schultheis Area Director of Sales UK,Ireland&Nordics Rotana Hotels and ResortsRico LopesDirector Supplier Development GraebelShabina AwanVP Partner DevelopmentSilverDoorSoren Sturup-ToftGlobal People Operations DirectorOxa AutonomySteve Frey CEO OasisSteve LowyCEO The Residence Stuart Godwin Managing DirectorLamington GroupFiona MurchieFounder and Managing EditorRelocate Global LimitedGeorge Sell Editor-in-chiefInternational Hospitality MediaJack Ramsey CEO TripStax Technologies LtdLinda RaffertyGlobal Head of Compliance and ESG K2 Corporate MobilityStuart WinstoneChief Executive OfficerSilverDoorWith thanks to all our interviewees and written contributors.Special thanks to our guest writers:Catherine Chetwynd,Fiona Murchie,George Sell,and Jack Ramsey.Only contributors that were directly interviewed by the GSAIR team will appear here-thanks also to any third party interviewees/contributors that may appear on the following pages.11GSAIR 202410ADR:Average Daily Rate.Agent:Used more generally to describe an intermediary,either individual or company,booking travel or accommodation on behalf of another party.AI:Artificial Intelligence.APAC:Asia-Pacific.Aparthotel:Fully furnished and equipped apartments,which include hotel services such as manned reception and cleaning.Typically used for shorter stays and suitable for business and leisure use.API:Application Programming Interface.ASAP:Association of Serviced Apartment Providers.Assignment working:A short or long term stay,undertaken to perform a specific task or project based trip.Stays can last between 30 days and three years and are temporary,whereas Relocation(see below),is permanent.Assignment workers are often referred to as assignees.Business travel:Journey specifically taken for work purposes,usually but not always up to seven days.Business travel excludes daily commuting,leisure trips or holidays.CHPA:Corporate Housing Providers Association.Co-living:Co-living refers to accommodation where multiple unrelated people can live together.Units usually contain large communal spaces as well as private bedrooms.Developments often feature social areas and programmes designed to foster a sense of community.Corporate housing:Residential apartments,packaged up to include servicing and bills,typically bookable for a minimum of 30 nights,either let and maintained by the operator on an ongoing basis or rented specifically for a particular housing requirement and length of time,after which they are handed back to the owner.Corporate housing is also the term used in the U.S.to describe serviced apartments.CRM:Customer Relationship Management.DE&I:Diversity,Equity,and Inclusion(also referred to as EDI).DSP:Destination Service Provider.EMEAEurope,the Middle East,and Africa.ESG:Environmental,Social,and Governance.F&B:Food and Beverage.FTSE:Financial Times Stock Exchange.GDPR:General Data Protection Regulation.GDS:Global Distribution System(e.g.Amadeus,Travelport,Sabre).Gen Z:Generation reaching adulthood in the second decade of the 21st century.GHG:Greenhouse gas.GSAIR:Global Serviced Apartment Industry Report.Homestay:Generic term for products like Airbnb,or home rental.ITM:Institute of Travel Management.LOS:Length Of Stay.M&A:Merger and Acquisition.NDC:New Distribution Capability.OBT:Online Booking Tool.Occupancy:Percentage of occupied bedrooms/apartments during a set period.OTA:Online Travel Agent(e.g.Expedia,B).PMS:Property Management System.QR:Quick Response(commonly referred to as QR code).Relocation:Relocation(also referred to as Relo),involves permanently moving an employee,and family,to another city or country.RevPAR:Revenue Per Available Room.RFP:Request For Proposal.RMC:A Relocation Management Company provides outsourced relocation logistics management for organisations of different sizes and needs.ROI:Return On Investment.Serviced living:Generic term to describe the expanding number of emerging extended stay concepts.Fully furnished accommodation including kitchen facilities,with some private and communal spaces.TMC:A Travel Management Company manages the business travel requirements of an individual or organisation,in line with their corporate travel policies,where relevant.Several acronyms or abbreviations are used in this report.These are as follows:GLOSSARYOF TERMS13GSAIR 202412Celebrating the 11th edition Im delighted to be sharing the 11th edition of the Global Serviced Apartment Industry Report with you fondly referred to by many as GSAIR.In 2023 we made some format changes that allowed us to deliver GSAIR in four chunks across the calendar year:Survey&Results,and three regional reports covering EMEA,Americas,and APAC.Weve retained the same format in 2024 and are thrilled the new regime has been so warmly embraced by so many of our readership and contributors.16 years and still going strongIts been 16 years since the first publication of GSAIR and Mark Harris of Travel Intelligence Network has worked on and contributed to all editions since 2008.Mark originated the publication alongside Charlie McCrow,of what was then The Apartment Service.Anyone who has contributed to GSAIR across the years will likely have been expertly interviewed by Mark,and its fair to say his enthusiasm and commitment to GSAIR hasnt waned one bit.Thank you,Mark,for working with us to bring GSAIR together each year,we appreciate your drive and dedication.Annual amalgamationAt Ariosi,we survey over 3,000 corporate buyers,agents,intermediaries,and operators of serviced apartments to bring you this annual amalgamation of survey results,data analysis,expert industry commentary and opinion.In doing so,we provide a global perspective on serviced apartments,corporate housing,and temporary living whilst the terminology might differ regionally,the insights are real,current,tangible and we hope you find them to be of value personally and in your organisation.Collaborative contribution Weve gathered some of the finest industry voices to be interviewed,form focus groups,sit on mini discussion panels,and even be peppered with hot seat style Q&A we hope you enjoy the takeaways of these excellent collaborative contributions.Were proud to engage and partner with such a diverse and expert group of professionals to deliver content filled with valuable insights.Get to know Ariosi Were specialist serviced apartment consultants and the home or OrbiRelo and GSAIR(hopefully the latter is clear,given youre reading this in the 11th publication of the same).We work with anyone who touches or is interested in serviced apartments actual or aspirational operators,agents,intermediaries,buyers,investors,and developers.At Ariosi,we aspire to be the place you come to access accurate and up to the minute insights,advice,support,and training resources.Our aspirations are becoming a reality-thank you to our clients that have and are making this possible,allowing us to curate and deliver tangible products and services back into your business.A sincere thank you GSAIR wouldnt be possible without significant contributions from so many of you.Its my 3rd year of all things GSAIR and each year Im bowled over by the enthusiasm of all who get involved Im always humbled by the time you give to us,particularly as were all perpetually squeezed and with many business priorities to juggle.Thank you to our sponsors,advertisers,varied contributors,and supporters,your unwavering commitment continues to make GSAIR possible.Enjoy,and best wishes for the year ahead I hope you enjoy our latest GSAIR instalment and best wishes for 2024 and beyond.With that,Ill let you delve into the results and supporting commentary and may it serve as a catalyst for further collaboration,innovation,and growth within our industry.Welcome to the 11th edition of the Global Serviced Apartment Industry Report.By Joanna CrossChief Operating Officer,AriosiWELCOME AND INTRODUCTION1.Corporate demand has levelled off following the spike that peaked in 2022 and tailed off in 2023;post-pandemic travel programme reviews,growing corporate commitment to sustainability and the adoption of purposeful travel,resulting in fewer,but longer stays.2024 should be seen as the new normal.2.Whilst many business travellers and assignees are still working remotely,there has been a gradual increase in the return to office-based work in some sectors,with companies now requiring employees to be in the office at least three days a week.The impact of which is rising hotel rates,especially in London.Workstations are now a mandatory element of corporate RFPs.3.During the pandemic,companies showed that projects could be completed without travel,let alone relocation.The relocation market has been becalmed by economic and geo-political factors,so apartment operators are looking to other source markets including blended trips and group travel associated with film,music,and sport.4.Although progress amongst operators is generally slow,ESG is no longer a box-ticking exercise.As well as Gen Z travellers,travel and mobility managers now require providers to evidence their Environmental,Social and Governance credentials in most RFPs.The brands have cottoned onto this,but smaller operators risk being left behind.5.Buyers want technology to provide more choice,slicker and simpler booking processes,and a better user experience.They remain frustrated by TMCs reliance on legacy GDS technology,despite the opportunities provided by API direct connects and AI.The problems start with the more emotive longer stays which demand human interaction.6.A combination of interest rates,rising building costs and increased regulation in major European and international cities has hit developers margins hard,dis-incentivising new builds.With everyone fishing in the same pond,those who can think outside the box will be the ones to clean up.7.Hotel chains are reacting to fragmentation of the extended stay sector by launching their own extended stay brands,with built in GDS connectivity,either in dedicated buildings or as dedicated floors within their hotels.They have the economies of scale,but cannot realistically compete with the smaller,more agile players.8.The competitive advantage enjoyed by serviced apartments post-pandemic has been eroded by hotels.Radical collaboration between operators,especially around distribution technology,sharing data and common data platforms is required,to prevent market share being lost.9.Disintermediation(direct selling to corporates)has been accelerated in the air and hotel sectors by NDC(New Distribution Capability.)If TMCs and RMCs do not expand their inventory and bookability,expect suppliers to ramp up their direct sales too.It wont be long before TMCs start buying serviced apartment specialist agents,or vice versa.10.The serviced apartment industry is still struggling to attract talent,which is impacting the user experience and could contribute towards consolidation between brands,intermediaries,and technology providers.Unless operators are able to put hospitality at the heart of their offerings,hotels will take full advantage.The macro trends that will be driving the industry in the year ahead;from hotels creating new extended stay brands,to connectivity,disintermediation and why ESG just got serious.TOP 10 TRENDS DRIVING THE SERVICED APARTMENT INDUSTRY IN 202411 Based on 1-2-1 interviews with 30 corporate buyers,intermediaries,and operators April-May 2024.Credit:edyn15GSAIR SURVEY AND RESULTS ANALYSIS2A bespoke survey of travel and mobility managers,agents,relocation and travel management companies,and serviced apartment and corporate housing operators has been at the core of the Global Serviced Apartment Industry Report ever since our first edition,way back in 2008.Each year we survey around 3,000 people across these categories,with respondents completing either our Buyers,Agents3,or Operators survey.Some questions are common to two or all three surveys;others are specific to one.Credit:The GateWe usually vary some of the questions posed,so that the survey remains fresh and relevant.Thats why,in this article,year-on-year comparisons are provided in some cases,and not in others.By Mark HarrisContributing Editor2024 figures and charts with supporting commentary provided by Mark Harris.More nimble.More current.More bite size.4 publications throughout the yearto keep you up-to-date.GSAIRSurvey&ResultsGSAIREMEAGSAIRThe AmericasGSAIRAsia-Pacific2 Survey conducted March-April 20243 36.36%of agent respondents were Destination Service Providers,compared to RMCs(31.82%);specialist serviced apartment agents(13.64%)and TMCs(9.09%.)This is broadly comparable to 2023 agent survey respondents.17GSAIR 202416Fig.2 Why corporates use serviced apartments 2024 vs.2023 Fig.3 Agents clients corporate serviced apartment usage 2024 vs.2023 SERVICED APARTMENT VOLUMES Corporate usage of serviced apartments is down year-on-year.62.5%of buyers are using serviced apartments for business travel,down by 11.18%from 73.68%in 2023.Usage for assignment or project working shows an increase on 2023.62.5%of corporates are also using serviced apartments for this purpose in 2024,compared to 57.89%a year earlier.Usage for relocation is also down year-on-year,with 56.25%of corporates using apartments for this purpose,compared to 73.68%in 2023.Although usage in two out of three purpose categories is down,usage for business travel is falling in fewer companies(9.09%)this year than the same time a year ago(13.33%).However,the same is not true of assignments or relocation.Apartment usage for assignment work has fallen in 15.38%of companies in 2024,compared to 7.69%in 2023.Usage for relocation has fallen in 27.27%for corporates compared to 16.67%a year ago.Agents report that 42.86%of their clients are using serviced apartments more for business travel,although this is also down year-on-year from 55%in 2023.Usage for assignment/project working is down amongst 30%of agents clients compared to 63.64%a year earlier,whilst usage for relocation is also down,but marginally at 40%of agents clients compared to 43.48%in 2023.Operators say they have seen the highest growth in business travel and leisure bookings equally(24.62%),followed by assignment/project working.Operators say their overall relocation business has shown the least growth at 16.92%.Fig.1 Corporate serviced apartment usage 2024 vs.202319GSAIR 202418Fig.4 Operators biggest growth market by segment 2024Fig.5 Corporates predicted average length of stay 2024 vs.2023 LENGTH OF STAY AND RATES Looking to the year ahead,80%of buyers say their average length of stay is unlikely to change.This is a big turnaround from 44.44%who made the same prediction in 2023.The remaining 20%predict their average length of stay will be longer,also at 44.44%in 2023.68.16%of agents say their clients length of stay averages 30 nights,compared to 87.1%in 2023.18.18%of agents report an average 45 nights length of stay.75%of buyers say their serviced apartment costs have risen compared to 2023;12.5%say they have stayed unchanged.Unsurprisingly,none report that rates have fallen.21GSAIR 202420Fig.6 Agents clients average length of stay 2024 vs.2023 Fig.7 Corporates usage of Homestay and Co-living products 2024 USAGE TRENDS Growth in the usage of serviced apartments for each trip purpose is slowing.Only 18.18%of buyers say their usage for business travel is growing,compared to 53.33%in 2023.Usage for assignment/project working is growing in 15.38%of companies,compared to 38.46%in 2023.The biggest source market for growth is relocation,with 27.27%of companies reporting their use of serviced apartments for this reason is growing,compared to 11.11%in 2023.The growth of Airbnb and other Homestay product adoption has slowed,but still outstrips the adoption of co-living products.Early adopters report limited growth year-on-year.18.75%of companies say their use of Homestay products has not grown.In 2023,50%of buyers were using Airbnb type products with 62.5%considering using.Growth in the adoption by corporates of co-living has virtually stalled.Despite 50%of buyers reporting they were already using co-living in 2023,figures in 2024 show that usage also remains unchanged in 18.75%of companies and is growing in just 6.25%of companies.75%buyers say they do not use co-living products.Agents say their clients usage of Airbnb is unchanged in 31.82%of cases but growing in 22.73%.Similarly,usage of co-living is growing in 9.09%of their clients companies,and is unchanged in 27.27%.23GSAIR 202422Fig.8 Agents clients usage of Homestay and Co-living products 2024 WHY SERVICED APARTMENTS (AND WHY NOT)?When choosing a serviced apartment over any other accommodation product,the most important factor for travel and mobility buyers is policy compliance,followed by location and traveller safety.In 2023,the top three factors were traveller safety(#1),location(#2)and cost(#3).By contrast,agents cite location(#1),cost(#2)and traveller safety(#3)as their clients most important selection criteria.AI is not yet having any impact on buyers programmes,but buyers cite a wider choice,content,and pricing options as hoped-for future impacts.Agents are also undecided about the future impact AI will have on managed travel programmes.The top barriers to greater usage of serviced apartments for both buyers and agents in 2024 are cost,followed by location(i.e.sourcing apartments in the locations they need)and technology,specifically the lack of online availability.Fig.9 Corporates decision making criteria when choosing a serviced apartment 2024 Length of stay25GSAIR 202424SOURCING More buyers are booking serviced apartments through TMCs,and specialist serviced apartment agents than a year ago.62.5%of corporates now book apartments via a TMC compared to 31.25%in 2023.37.5%of corporate buyers use a specialist serviced apartment agent,compared to 50%in 2023.12.5%now book via a bespoke enquiry portal,compared to 0%in 2023.The proportion booking directly with properties remains unchanged at 12.5%.Amongst agents,72.73%of serviced apartment bookings are still made manually,direct with the property,compared to 40%in 2023.54.55%of intermediaries source serviced apartments via a specialist serviced apartment agent,compared to 66.67%in 2023.Operators top 3 sources of business by booking channel are OTAs(#1);direct from the(corporate)client(#2)and via a specialist serviced apartment agency(#3).45.45%of intermediaries now regard serviced apartments as a core part of their offering,compared to 61.29%in 2023.40.91%offer serviced apartments as an ancillary service compared to 41.94%in 2023.18.18%only offer serviced apartments within an overall hotel offering,compared to 6.45%in 2023.The top 3 cities in which buyers expect to see the biggest growth in the next twelve months are London(#1),Tokyo(#2)and Singapore(#3).The top 3 cities in which buyers struggle to find supply of an acceptable standard are London(#1),New York(#2)and Bengaluru(Bangalore)in third.Fig.10 How corporates book serviced apartments 2024 vs.2023 Fig.11 How agents source serviced apartments 2024 27GSAIR 202426Fig.13 How do agents present serviced apartments 2024 vs.2023Fig.12 Operators source channels by booking volume 2024 PROGRAMME PERFORMANCE METRICS 56.25%of corporate buyers use total cost of stay to measure success in their serviced apartment programmes,followed by accommodation cost per night(50%)and booking/procurement team feedback(31.25%).Agents say their clients measure success based upon accommodation cost per night(#1),guest feedback(#2)with total cost of stay in third.Fig.14 How corporates and agents measure serviced apartment programme success 2024GSAIR 20242829Fig.15 Proportion of RFPs requiring evidence of providers sustainability credentials 2024 SUSTAINABILITY 53.33%of companies now require serviced apartment providers to evidence their sustainability credentials in all RFPs.This is a significant increase on 35.71%in 2023.33.33%require the same evidence in some RFPs,down from 50%in 2023,whilst just 13.33%dont require any such proof,virtually unchanged from 14.29%a year ago.Agents say 45.45%of their clients require evidence in all RFPs and the same figure require evidence in some.12.5%of operators say all RFPs and 50%of some RFPs they have received in the last twelve months have required evidence of their sustainability initiatives.43.75%of corporate buyers say their organisations have calculated their Scope 3 emissions,almost twice 2023s figure of the 21.43%.25%of buyer organisations have calculated their Scope 2 emissions,a three-fold increase on 2023s 7.14%.Just under a third(31.25%)of buyer organisations have not calculated their greenhouse gas emissions to any degree.In 2023,64.29%stated this to be the case,highlighting the progress made in just twelve months.Amongst agents,33.33%say their organisations have calculated Scope 1 emissions;28.57%have calculated Scope 2 and 19.05%have calculated Scope 3 emissions.Only 4.69%of operators say they have calculated Scope 3 emissions,compared to 13.79%in 2023.9.38%say they have calculated Scope 2 emissions,compared to 15.52%in 2023.21.88%of operators say they have calculated Scope 1 emissions,which compares to 22.41%in 2023.However,the bulk of serviced apartment operators have made no progress at all.In 2023,68.10%had not yet calculated their GHG emissions.Twelve months on,in 2024,64.06%of operators still have not calculated their emissions.Fig.16 Corporate buyers organisation GHG emissions calculated 2024 vs.2023 Scope 1:direct emissions from owned or controlled assetsScope 2:indirect emissions from the generation of your companys purchased utilitiesScope 3:all other indirect emissions that occur in a companys value chain,e.g.waste and business travelGSAIR 20243031Fig.17 Agent organisations GHG emissions calculated 2024 Scope 1:direct emissions from owned or controlled assetsScope 2:indirect emissions from the generation of your companys purchased utilitiesScope 3:all other indirect emissions that occur in a companys value chain,e.g.waste and business travelNot measured any GHG emissionsFig.18 Operators GHG emissions calculated 2024 vs.2023Scope 1:direct emissions from owned or controlled assetsScope 2:indirect emissions from the generation of your companys purchased utilitiesScope 3:all other indirect emissions that occur in a companys value chain,e.g.waste and business travel33GSAIR 202432AUTOMATION Serviced apartment operators automation in the last twelve months has centred on guest communications(65.45%);mobile apps/check-in(34.55%)and Property Management Systems(30.91%).In 2023,their focus was on PMS(73.6%),self-service check-in(49.6%)and mobile apps(31.2%).In the next twelve months,operators say their focus will be on mobile apps(27.27%),PMS(25.45%)and guest communications(23.64%).Fig.19 Operators automation focus 2024 SUPPLY Local corporate demand and the cost of property acquisition are the most important criteria for operators when selecting a new location.In 2023,whilst local corporate demand was ranked most important,competitor presence was ranked second,equal alongside cost of property acquisition.Looking to the future,operators are most optimistic for the next twelve months in relation to average length of stay(#1);average daily rate(#2)with occupancy ranked third.Fig.20 Operators reasons to be cheerful 2024 35GSAIR 202434Way back in the mists of time(well,2008 anyway),the first edition of GSAIR defined a serviced apartment as“typicallyin urban locations,range in standard from budget to deluxe and offer hotel services such as 24 hour reception desk.they vary in style;however most are fully furnished with en-suite bathrooms,a fitted kitchenette and lounge/dining area.Many are run by major players in the hotel market”.16 years later,the market has seen the emergence of aparthotel,co-living,short term rentals and homestay,the latter including the Airbnb model that has brought the extended stay market awareness at the expense some would say of reputation.Earlier in 2024,an independent review of the role and value of serviced apartments in the UK was commissioned by the Association of Serviced Apartment Providers.It offered an,admittedly more succinct,but ultimately little-different definition.“Often described as home away from home,serviced apartments can be defined as self-contained accommodation units that offer an array of hotel-like services such as regular housekeeping and flexible lease terms.”4 Plus a change,as the French say.So what has the impact of other hotel alternatives been on the hospitality sector and its source markets?If you cant beat em“Things have changed a lot in the last 10 years”says Guillaume Gerard,Head of European Corporate Sales at Adagio Aparthotel.“Recently weve seen listing private rentals on their website.Like when Airbnb came on the scene,this has had the positive impact of raising awareness of our products,and those of our competitors.The challenge is always how well these products meet the needs of the business traveller,and their employers especially in safety,security,and regulatory compliance.”However,Guillaume also admits that existing players have been quick to learn from the new kids on the block.Lobby areas are a good example.With more than a nod to co-living products,Adagio have created the Circle;an environment in which to meet,but with shared kitchens,library books guests can borrow,and even some shops.By Mark HarrisContributing EditorIn 2024,what is a serviced apartment?How are blurred lines between alternative accommodation models impacting supply and demand,and why its important to size the market.CATEGORISING AND QUANTIFYING THE SERVICED APARTMENT MARKET“We try to inspire ourself with the other models”he says.“For example,Airbnb have some huge apartments.There arent any hotel chains doing this,so weve launched our co-living concept which includes four bedroom apartments in Bercy,Paris and in Whitechapel,London later in 2024.Thats really innovative.”The blurring of the lines between traditional hotels and serviced living has brought challenges for corporate travel managers,as one explains.“Having so much choice has raised our employees expectations,and they expect their employer to meet them.We try to meet them in the middle by being flexible without compromising on security.”“Theres also a lot of hidden costs with Airbnb and other Homestay options that employees dont necessarily see,and that makes things more challenging too”she says.Alex Neale is Senior Vice President Partner Relationships at SilverDoor.He believes the extended stay buyer and supplier communities should embrace the diversity of product types that now exist.“One of the things that makes this industry great is theres different products for different clients,but there are also some reasonably concrete categories in there,like aparthotels,co-living and,in America,corporate housing.Of course,there are other concepts that lie between,and products that fall under the home-sharing category,but we dont consider those to be part of our corporate serviced apartment offering.”SilverDoor colleague Shabina Awan elaborates further.“Whats important for us is to articulate why we use different accommodation types.There are a lot of products that have spun-off from serviced apartments.The ability to explain how they differ and for what types of client and trip they are appropriate,is essential.”Licensing the sectorThe ASAP commissioned report referred to earlier is not the first to size the UK serviced apartment(GSAIR did that!).However,it is the first to estimate the overall economic value of the sector at 1.7 billion.This is made up of 1.2 billion of aggregated turnover of“professionally run serviced apartments”and 500 million from single-key operators.The report also says the UK serviced apartment sector directly supports 6,050 jobs.Whats the purpose of the report?We asked James Foice,CEO of ASAP.“Quite simply,we wanted to provide a reliable estimate of the size and scale and impact of the serviced apartment sector to policymakers,so that they can make better informed decisions typically around planning-that could impact our industrys future”he says.Due in part to being categorised by politicians alongside Airbnb,parties,and anti-social behaviour not to mention taking up housing stock in a housing crisis,the report has been published as a licensing scheme for operators in England gets ever-nearer.“We needed to determine the impact of any potential legislation in terms of capacity,and therefore room rates.We have told government that the right thing for the accommodation sector in the UK is to incorporate fire safety and health and safety benchmarks into legislation.The challenge is that hotels,bed&breakfasts,and hostels will be excluded from that legislation”Foice concludes.Which is in everyones interests after all.According to the Emerging Trends in Real Estate:Europe 2024 report by PwC5,the interest in investing in serviced apartments has been gradually growing.In a ranking of 26 real estate sectors,serviced apartments climbed from the 16th place in 2022 to rank in 9th in 2024.James FoiceCEOASAP“If youre going to exclude any part of the accommodation sector(from legislation),you may as well not bother because some organisations could claim to be a product type that they are not.”Credit:The Ascott LimitedCredit:The Ascott Limited4 https:/theasap.org.uk/independent-review/5 https:/ is the sectors biggest threat and opportunity Steve Lowy is CEO of student accommodation provider Anglo Educational Services(AES)and serviced apartment operator The Residence.He is also serving chair of the Association of Serviced Apartment Providers(ASAP).How is increased regulation impacting serviced apartment operators ability to pivot towards other source markets?Regulation is both our greatest threat and opportunity.In cities across Europe and internationally,restrictions have been initiated whereby operators cannot let residential-style apartments for certain fixed periods per calendar year.In London,thats 90 days.In Dublin its 14,and 30 in New York.Although this isnt every city,it does feel like there will be some sort of restriction in most major cities in the coming years.If a citys leisure market averages two nights stays,and the minimum stay is 14 days,serviced apartment operators will struggle to fill their apartments.These restrictions are obviously threats.The opportunity,is that regulation is brought in with regards to basic health and safety standards covering fire regulations etc.This could improve standards across the board and show governments that there are plenty of excellent,and safe operators in this sector.What has ASAP done about this?The sector has operated under the radar for decades but not anymore,because governments have seen the impact of Airbnb on the housing crisis and serviced apartments have been swept up into the new regulatory reality.We produced an in-depth report that sizes our industry6 to stop government making uninformed decisions that could devastate an industry worth 1.7 billion to the UK economy;especially when our economy hasnt grown significantly in the last 10-12 years.7 Airbnb has normalised staying in temporary accommodation.The challenge now,for smaller serviced apartment operators,is to professionalise themselves to distinguish themselves from operators who dont have health and safety documents or fire alarm systems.Whats the future look like?If the UK government makes the serviced apartment sector totally inflexible,they will kill off a thriving sector.If the proposed new C5 use classification for future short-term lettings of under 90 days will be allowed,subject to operators getting planning permission,then there could be greater flexibility.8 That will enable professional operators to get on with business without having to worry about a knock on the door.However,in reality,with the election pending,there remains a lot of uncertainty and the consultations that took place in 2023 have yet to be taken to a stage whereby the findings are presented.Join as we put a CEO in the spotlight HOT SEAT-WITH STEVE LOWY OF THE RESIDENCE Credit:Domus Stay6 ASAP Independent Review of the Role and Value of Serviced Apartments in the UK https:/theasap.org.uk/independent-review/7 https:/ https:/www.gov.uk/government/consultations/introduction-of-a-use-class-for-short-term-lets-and-associated-permitted-development-rights/introduction-of-a-use-class-for-short-term-lets-and-associated-permitted-development-rights39GSAIR 202438Gen-Z employees(people born between 1997 and 2012)now make up over 20%of the UK workforce.9 So they also represent a significant chunk of the travelling and mobile workforce and growing.This put the onus on travel and mobility managers,and their suppliers,to understand this new customer segments needs,lifestyles,and attitudes.Gen-Z spends an average of 10.6 hours per day online,making them the most digitally connected generation.10Gen-Z expects convenience and efficiency in their interactions.In an accommodation context,which means offering mobile check-in and checkout options,providing high-speed Wi-Fi,and integrating mobile payment methods.The heirs to our planet have also inherited responsibility for climate change.In fact,climate concern is the biggest concern for a third of Gen Z.11 90%are trying to reduce their own impact on the environment.So how do the needs of the new generation differ from those of previous ones?More space,more comfort,more animals“One thing we saw throughout Covid was lots of people got pets,”says Andrew Meadowcroft,Vice President of Customer Experience at relocation company,Aires.“Thats changed what our customers need from temporary housing.Before the pandemic,maybe one in every ten relocating families has a pet.Now,a significant amount of our relocating families travel with pets,which has put a lot of pressure on the temporary housing industry to meet to those needs.”“The dynamic has changed.Lots of companies have moved to a hybrid workforce,so employees who are relocating or looking for more space;the ability to be able to work comfortably from home.Weve seen an uptrend in people,who have traditionally been entitled to a one-bed apartment or flat,wanting an area for a home office as well.”Fewer trips but longer Karen Hutchings of Cobb&Hutch Consulting says business people are traveling longer but making fewer trips.“Sustainability is partly responsible,and behaviours are changing too.Instead of travelling backwards and forwards every week,they are staying longer and then working from home for the next two.Individuals also dont necessarily want to stay in large hotels so much and prefer the less crowded serviced apartment concept since the pandemic.”By Mark HarrisContributing EditorRemote working,blended stays,and long stays;data-driven personalisation;localisation,security,and other sourcing trends.WHAT CHANGING TRAVELLER AND ASSIGNEE NEEDS MEANFOR CORPORATES AND OPERATORS“Serviced apartments offer these travellers the option to be on their own.Some,especially in the U.S.want to travel with their pets.Then you have the work-from-home culture,which makes it even more important to bring people together because theyre not getting that office-related interaction.Thats why meetings and events are on the increase.”“Many companies are reducing their footprint from a real estate perspective because they know people are not going to be in the office so much”Hutchings says.Dusko Kain is Corporate Land Supply Manager EMEA at Flight Centre Travel Group.His customers want extra space too.“They are staying longer so they are looking for a little bit more comfort too.For people staying more than two weeks,the work-life balance of being able to bring your family or pets with you is an important part of wellbeing.”Digital nomadsThe Oxford English Dictionary defines a Digital Nomad as“a person who earns a living working online in various locations of their choosing(rather than a fixed business location).”Its a term often associated with guests at edyn hotels,although Global Director of Sales and Business Development,Chris Orme says it is meaningless and hard to quantify.“I prefer to say theres a class of traveller defined by the spaces in which they stay because the reasons for their stays are multifaceted.It might be a combination of business and leisure,or a combination of office-based and field-based work and thats where we need to start.What does that traveller need?Not just in terms of a kitchen,Wi-Fi,or living space,but a co-working space,or a small meeting space.”“Theres a conversation to be had about loyalty programmes too.If youre looking to nudge people away from hotels into serviced apartments,we need to think about that,and other value-adds.”“Things like early check-in or check out,and super-fast Wi-Fi are an expectation now for business travellers,just like hot water and a good nights sleep.For operators,its about working out what else the customer needs within the apartment.“A new generation has joined the business travel community.They demand a seamless experience and wont put up with friction.Its got to be seamless and app-based because its not just about the product.Its about the nature of the stay.”ESG As ESG becomes more embedded in corporate travels DNA,travellers and assignees want to know their travel partners ESG credentials,from the booking process to the apartment itself.However,as Leanne Fowler,Director of Account Management at Clarity Business Travel points out,“most serviced apartments are still in their infancy when it comes to sustainability.However,progress is being made.”“It will be essential for them to make sure the carbon accreditations theyre using are available to travellers at the point of booking,and not just in a post-travel report for travel managers.”David Wright is Portfolio Development Manager&Sustainability Officer at Mansley Serviced Apartments and heads up ASAPs Green Team.He agrees operators want help in how to navigate the often-confusing world of ESG.“The task of measuring Scope 3 emissions is a common challenge raised,as well as uncertainty around which measurement metrics to use”he says.“Travellers need information,like a sustainability checklist,for any property in which they stay.”Credit:Hybrid ResiCredit:Domus Stay9 https:/ https:/ https:/ 41 Quality,space and comfort/Safety and compliance Exceptional customer services/Over 40 locations to choose from across London,the South East,and Lisbon.Were here to Telephone: 44(0)208 944 3662 or email SERVICED APARTMENTS FOR BUSINESS FOR OVER 25 YEARS Bringing a Human Touch to the Digital WorldAccommodation your business can depend onWhy arent serviced apartments used within Wood?Although our length of stay is growing(currently its 3.3 nights),for stays of 7 nights our people tend to stay in hybrid extended stay hotel suites,rather than traditional serviced apartments.Thats because serviced apartment content is not readily available at the point of sale.Youve implemented a simplification strategy.How will that impact serviced apartment usage?A new travel portal will make a huge difference.For example,it currently takes 4 clicks to find the online booking tool.With the new portal it will take 4 clicks to complete a booking.We want to give our bookers and travellers a consumer grade experience for booking long stay accommodation.Our challenge will be to optimise the content to make sure people are getting what they want when they go to book.How many bookings currently cant access the content they need?Stays of seven nights or more make up 10%of our bookings,with 30 night stays representing 3-5%of that.Most is going into aparthotels rather than apartments because that content is not available through our TMC.Our nirvana would be that within the online booking tool,once the booking is flagged as a long stay,relevant content should present,even if it is a combination of traditional and hybrid serviced apartments to provide choice.Currently,the only way I can see this is possible is through API direct connects into the TMC/OBT.Why is this?Largely because serviced apartments dont have the ability to get serviceable GDS-equivalent content to the point of sale,even though Expedia and both can facilitate it.TMCs drive GDS content because theres a commercial upside.For me,serviced apartment providers,the GDS and TMCs need to have a mature conversation about how to make sure they all remain profitable,enable richer content without any major impact to the price point and all be available at point of sale online and offline.Daniel Cockton is VP-Global Travel Services at Wood PLC,a multinational engineering and consulting business,headquartered in Aberdeen,and Associate Director at ITM.CASE STUDY-WHY MAKING IT EASY IS THE KEY TO COMPLIANCECredit:Your Amsterdam Housing43GSAIR 202442Dynamic,proactive,and innovative,the serviced apartments industry is maintaining its reputation for keeping up with trends.Availability and price of land dictates that many openings are in converted or renovated spaces and although traditionally,Cycas has built extended stay properties,“While land is available,construction costs are increasing.We are seeing opportunities to convert offices or retail into accommodation,especially in historic city centres such as London,Amsterdam,and Paris,”says Chief Operating Officer of UK&I,Keith Griffiths.Operators are also building,with a major focus on Asia,and China in particular,where demand for extended stay properties is growing.Adagios first establishment in the country is in Chengdu Jianyang,planned for 2025,and Frasers is increasing its footprint with Fraser Residence Tianjin and Fraser Place Chengdu.The company opened Frasers Suites Al Liwan Bahrain in February this year as part of Seef Properties mixed-use Al Liwan development.“Global brands are expanding into new regions with big investments in the Middle East and Africa,such as Dubai,Riyadh and Addis Ababa,”says Rebecca Brooker partner account manager at Situ.“In the UK they are moving outside London.Cycas Residence Inn by Marriott Cambridge will open in 2026 and Staycity is building in Park Street,Cambridge.”Supply and demand continue to evolve,with built and converted properties increasingly providing co-living spaces and technology to provide greater convenience for guests.By Catherine ChetwyndEditor of the Institute of Hospitality MagazineSERVICED APARTMENTS-THE NEXT PHASE OF EVOLUTIONEuropean expansionIn the rest of Europe,Cycas is bringing Holiday Inn Express and Suites to Sion,Switzerland early in 2025,and Accor continues to expand in France with Adagio Access in Porte de Camargue and Boulogne-Billancourt Kermen(new builds),and a renovation in the form of an Adagio Access in Rouen.Staycity is expanding its Wilde brand through a mixture of construction and renovation;its Bordeaux property combines new build and conversion in the city centre.Unusually for London,where space is notoriously at a premium,the company is pursuing its hybrid model in Middlesex Street,Spitalfields,E17,is putting up a new build in Great Eastern Street,EC1,and in Amsterdam.The organisation will also be running Wilde in another five locations in the UK,France,and Germany;details yet to be revealed.Staycitys properties epitomise the increasing trend towards co-living spaces.“It is important that we keep our offer relevant,and we are incorporating flexible space into our developments where we can,with areas for guests to work,have meetings,socialise,eat or just relax,”says Director of Brand&Marketing,Jason Delany.“Todays travellers are more fluid in the way they use aparthotels,combining business with pleasure and needing facilities and spaces that fit with both.Our aim is to keep ahead of these changing trends.”Adagio is launching this style at Adagio Original London Whitechapel later this year with five co-living units,each comprising four bookable rooms around a common area that includes a kitchen and a lounge.This follows the first version in Adagio Original Paris Bercy.“Over the past 12 months weve seen the continuing rise in popularity of aparthotels and other alternative accommodation/blended model style solutions via requests from clients and their employees,”says Chief Operating Officer at Ariosi,Joanna Cross.“This is driving a flow of more flexible style environments entering the market.”Ascotts lyf responds to this demand with public spaces that are aimed at“digital nomads,technopreneurs,creatives and self-starters,”and can be used for workshops or social gatherings.This reflects the rise in blended travel,with corporate travellers adding holiday to work trips.The organisations Citadines also have co-working spaces.Cheval Collections MY Locanda is under construction in Glasgow and will provide F&B and The Lounge,which will be open to guests and the public,tuning into the local community.In fact,community is the brands raison dtre,with communal kitchens and a Wall of Curiosity that allows locals and residents to lend and borrow items during their stay.Multi-purpose and connectedSitus Rebecca Brooker notes this growing trend:“Weve seen property partners looking at multipurpose areas which can be used for co-working or meeting spaces in the day but become restaurants,cocktail bars or venue hire spaces in the evening.There is much more consideration being given to bringing the community in,which is a big factor in co-living space and for many new aparthotel developments,”she says.Situs supply chain has moved towards digital solutions to improve energy consumption and guests health and Credit:PREM GroupCredit:Oasis Private CollectionSoren Sturup-ToftGlobal People Operations DirectorOxa Autonomy“You can check-in and out at an Airbnb on a smartphone app but not a serviced apartment.Todays travellers want this in every major city in the world,now.”Anonymous Corporate Buyerin a leading role for People,at a Global International Bank“Its more of a challenge now because there is so much more choice.It not just hotel vs.serviced apartment,youve got so many blurred lines in between.Its more of a challenge because employee expectations are a lot higher.”45GSAIR 202444Credit:Oasis Private Collection“The prominence of the serviced apartment offer has prompted some of the larger branded hotel groups in North America to play in this space by designing products with slightly larger rooms and extra amenities to attract longer stay guests.”“Mobility may have plateaued,but new customer segments are emerging.As serviced apartments start to play in these new customer segments,their offerings,distribution,and their service ethic needs to move more towards the hotel model,whilst remaining true to their serviced apartment roots.”“The serviced apartment sector also has to change to remain relevant to the business traveller community.A branded apartment offer needs to provide cost savings(compared to hotels),quality assurance,traveller safety and sustainability.Especially those with a larger consistent footprint.”Chris OrmeGlobal Director of Sales and Business Developmentedyn“Airbnb seem to be everywhere yet with huge disparities from one operator to another,and travellers demand the consistency,reliability and safety that can only be found by using professionally accredited serviced accommodation providers.These specialist firms operate in a professional manner by paying equal attention to duty of care and hotel-like booking terms”.“These days corporates also have more choice and aparthotels have certainly taken centre stage.Longer term,I believe we will a see a move away from using residential apartments for very short stays and leisure bookings,and with upcoming changes to legislation in the UK surrounding short lets its likely that we will also see a fair amount of M&A among those operators with smaller portfolios”.Ben DavisCo-founderSaxburycomfort,with better controls for air,heat and lighting going into new developments.In addition,“Online information packs are now accessible via QR codes or apps,smart TV apps give details of property facilities,there are keyless entry systems,and app-based customer care services provide improved round the clock support,”says Brooker.Guest experienceAscott is piloting the use of self-check-in kiosks with facial recognition technology using computer vision AI at several properties in Singapore,with plans to roll out worldwide,and loyalty programme members can check in on the groups DiscoverASR mobile app,use it as a room key and order amenities.On trial at lyf one-north Singapore is a web app on which guests can order food from dining outlets in or near the property.Ascott also launched a generative AI powered chatbot on DiscoverASR.com last year to aid travel planning and booking,and to answer routine questions 24/7.Cheval Collection provides mobile keys,streaming from guests devices on to screens and smart lighting but,“We have sought to avoid complicated room systems which can be inaccessible and,ultimately,unused,”it says.The last word goes to res:harmonics Giles Horwitch-Smith:“PropTech software is revolutionising the serviced apartment industry.Buildings are becoming smarter,with software integrations reducing the need for manual intervention,creating a smoother guest and operating experience.In interconnected serviced apartments,operators can learn from their connected devices,use data to better understand space management and maximise the performance of their assets,”he says.Credit:edyn47GSAIR 202446How important are serviced apartments in your travel programme?Theres always been an element of extended stay requirement but since the pandemic we have been mandating the use of our serviced apartment partners.We use extended stay accommodation for relocation,project-type work,and business trips above two weeks.We also use serviced apartments for shorter stays where colleagues are looking for an apartment rather than a hotel,and for our crisis management programme.What technology would make a big difference to your programme?The ability to include extended stay properties in our OBT,so a Cisco employee planning a 10 day trip can see the extended stay options available to them.Employees may prefer to stay in a non-full-service hotel,so they need to be able to select an extended stay property over a hotel.The challenge is importing extended-stay content for all locations we need,not just key ones,wherever they are travelling,when,and whatever the purpose.What would the benefits be?The process is very manual and its done through the TMC.Extended stay accommodation isnt always displayed to TMC front line staff,so they have to go offline to make some calls.At Cisco we drive adoption of our travel booking tool,so the culture is there but not the technology,yet.With it,companies like us will be able to drive adoption of extended stay properties.Some travel managers are so busy figuring out how to improve air,hotel and car content that extended stay has been less of a priority.For us,as we look at distribution,innovation and experience,extended stay is a great fit as we strive to create a modern retailing environment.Carlos Almendros is the Global Travel&Card Category Manager at Cisco,responsible for category supply management in all areas of travel.Along with his team of eight he oversees the Cisco travel programme,which uses American Express GBT its sole Travel Management Company(TMC).CASE STUDY-WHY TECHNOLOGY IS THE KEY TO GREAT CONTENT Credit:edynFrom a global mobility perspective 2024 has got off to an interesting start.Corporate travel and assignments are certainly back and in full swing.Even the regions hit by the harshest lock down restrictions such as Hong Kong,China,Malaysia,Australia,Peru,Argentina,and Chile are actively pursuing new markets for international assignees.A changing landscape for corporate housing Shifting political landscapes and legislation,particularly in the US and India,alongside increased demand for hybrid working,are key drivers of growth in global corporate travel demand.For many business leaders the shift back towards more office working continues to gain traction.“With change comes a need for agility,so it is important to ensure demand and supply arent at a disconnect as much as possible,”says Al Butler,Senior Client Programme Manager at SilverDoor.Trends shaping the international market A new report has revealed that New York City,The Bay Area USA,Tokyo,Singapore,and London top the list of wealthiest cities.12 The US has 11 cities in the top 50 including New York in first place and Northern Californias Bay Area encompassing the city of San Francisco and Silicon Valley in second place.Tokyo,once the worlds wealthiest city,now sits in third place with London in fifth place.Paris is the wealthiest city in mainland Europe in seventh place and Sydney in Australia has risen to eighth place.China is booming with five cities in mainland China making the list(Beijing,Shanghai,Shenzhen,Guangzhou and Hangzhou)as well as Hong Kong and Taipei.In the Middle East,Dubai is the wealthiest city in the region.Among rising locations was Vietnam,the top destination among 43%of respondents who have assignees relocating to new countries in the past two years.13 The trends shaping global mobility supply and demand.By Fiona MurchieFounder and Managing Editor,Relocate Global&Think Global PeopleCORPORATE HOUSING OVERVIEWCredit:The Residence12 https:/ Cartus Global Talent Mobility Survey 2024-https:/ 202448Volatility and geopolitical tensions will be key considerations Geopolitical issues are also a major influence on where and when global mobility teams may need to act.The World Economic Forum Annual Meeting at Davos defined 2024 as a year of rebuilding trust,against a background of increasing division,heightened hostility,and a surge in conflict.Elections will play a major part in the global economy in 2024.In India,business travel spending is expected to reach up to$38billion this year,as its General Election and the largest democratic event in history is currently underway.969 million people are eligible to vote in a region that is seeing significant economic growth and likewise growth in demand for corporate housing and accommodation rates.Like many of its international competitors,the economic situation has hampered growth in the UK property market.“We need to see interest rates coming down to stimulate the property market,but we might have to wait a while longer for this to happen”says Ben Davis,Co-founder at Saxbury.“Typically,development funding for new Aparthotel projects is provided by a pension fund,but escalating build costs and softer commercial yields have conspired to deter these funds from entering the market”.“If it costs an average of 180,000 per unit to build a new Aparthotel and your leased-up yield is sub-5.5%,by the time youve built it,financed it,and rented it to an operator,the capital value of that building often equates to just shy of what it cost to build.It barely washes its own face.”Supply and demand trends are influenced by new business challenges For many corporate employers post Covid,serviced apartments are becoming a cheaper and more popular option than hotels.Part of this is due to hybrid working,where assignees need more space in their accommodation in which to work,as well as optimising the employee experience.Another key point of transition for many companies is the need to accommodate and measure new metrics on Diversity,Equity and Inclusion(DE&I)and Environmental,Social and Governance(ESG)data.While many developing countries do not yet have the means or legislation in place to measure and enforce new policies,developed nations are increasingly under pressure to demonstrate strategy and provide data for customers,stakeholders,and regulators.A number of key sectors are undergoing fundamental shifts to change their business model and capitalise on new markets.This includes the car sector,oil,gas and energy,environmental and sustainability companies,and mining.The financial sector and technology are growing strongly but suffering from a shortage of talent and rising salary demands.No post-Covid recovery-yet Although mobility volumes are reported to have increased or stayed the same over the past two years,corporate mobility teams are understandably nervous.“In this business,theres always something coming around the bend that we as business owners have to anticipate.”Says Barbara Hale of dluxSuites and immediate past chair of the Corporate Housing Providers Association.“In the US and globally,many big corporates have cut back on relocations.The message Im getting is that the relocation market has struggled coming back since COVID,to pre-2019 numbers.”Chad Keiser,Global Category Manager at Graebel.“Were in a strange time with relocations,because although volumes are down,relocations are still happening and have the same needs.With corporate housing,its a very high-risk small reward kind of business and our partners have to make logical decisions on the inventory they hold.”“Theres a lot of folks out there,our partners included,doing temporary housing.They want to mitigate that risk as much as possible.So theyre doing a lot of aggregating and wholesaling and not holding that inventory,but at the same time for a corporate housing company to be successful you have to hold your own inventory.So its about finding that balance.”Commentators agree that the global mobility sectors stand at a critical juncture.The industry is grappling with a complex interplay of geopolitical,technological,and economic forces that could reshape the landscape.14Credit:B-AparthotelsCredit:The Capital Hotels,Apartments&ResortsBarbara Hale President,dluxSuitesand immediate past chair CHPA“Theres a saying in the US amongst corporate housing teams survive until 25.”14 https:/ 202450In May 2024,TMC technology specialist TripStax announced it had seen a surge in demand for data required to enable carbon reporting,risk management and traveller wellbeing services.TripStax said that the number of data points added to bookings from third parties through its TripStax Core processing system had increased by 185%in 2023 compared with the previous year.15 The company attributed this rise to increased demand for data needed for CO2 reporting,as well as for duty of care and wellbeing services for travellers.But does this surge apply to extended stay bookings?The evidence suggests that it does.Evidencing sustainability This years GSAIR survey found that 53.33%of travel buying organisations and 45.45%of agents clients now require serviced apartment providers to evidence their sustainability credentials in all RFPs.Thats a year-on-year increase of 17.62%.43.75%of corporate buyers say their organisations have calculated their Scope 3 emissions,almost double 2023s figure.“Clients are now under increasing legislative pressure to report on ESG factors”says Alex Neale,Senior Vice President Partner Relationships at SilverDoor.“Weve seen a massive change in the way clients carry out RFPs in terms of the information they want from serviced apartment providers.Were now moving on to the next phase which is how they use that information to change traveller behaviour.”“Thats why SilverDoor has created a Carbon Calculator.It will compare emissions from all the different types of apartments we book and compare them against hotels too.Its a mammoth data collection exercise to get to a point where we have all the information we need to answer these questions accurately”says Alex.What is the sector doing to prove its ESG credentials;the role of technology and the challenges around capturing data and reporting.By Mark HarrisContributing EditorHOW THE SERVICED APARTMENT INDUSTRYIS DRIVING ESGCase study K2 Corporate Mobility K2 is a relocation management company which began as a household goods shipping company and has since expanded into all elements of global mobility.Gavin Carruthers,K2s Partner Relationship Lead Europe says that RFPs are now less about price,and more about sustainability.“We want to nudge people to make the right choice,so we need to find a way to evidence the impact of an individual trip and translate that into options for the traveller.That kind of element within the RFP has become quite complex,so the data around that and whats required has become more granular in most RFPs.”Gavins K2 colleague Linda Rafferty is Global Head of Compliance&ESG.“Data is key,being able to gather that data and actually interpret it is paramount because if youre engaging with multiple reporting platforms,youre going to be getting data in different formats and must align all measurement methodologies.We partner with EcoVadis for our compliance elements.”“Our companys environmental impact is minimal.The services we provide to our clients,however,have a huge impact.As a result,we are very compliance driven and the organisations we deal with are highly regulated.”“In choosing to partner with EcoVadis for our supply chain compliance,we wanted a platform that can capture data across our entire network regardless of the type of service delivery partner.We have some aggressive targets in onboarding our partners to the EcoVadis platform,but we also know that other partners may also be engaging with other platforms,so were not making it mandatory as yet”says Linda.Scoping the problem The 2024 GSAIR survey shows that 43.75%of buyer organisations and a third of agents have calculated their Scope 3 greenhouse gas emissions(which includes the impact of business travel),yet only 4.69%of operators have done so.In fact,the bulk of serviced apartment operators have made no progress at all.In 2023,68.10%had not yet calculated their GHG emissions.A year on,64.06%of operators have still not calculated their emissions.Why is this?David Wright of Mansley Serviced Apartments says its down to smaller operators lacking the financial or human resources.“Some brands,like Staycity or edyn can employ entire departments to carry out the work.However a lot of operators only have a handful properties that dont have that luxury.Someone has to do the work,which is a big ask for some.”Stuart Godwin is Managing Director of Lamington Group.In 2022 his company published its One Planet Living Action Plan,which takes“a holistic approach to sustainability across the group and maintains our focus on reducing carbon emissions.”Lamington Group also publishes an annual ESG Report.16 He sums up the enormity of the task facing the sector.17“It takes a lot of best practice to offset or reduce the big bill of embodied carbon.We are talking about a whole life asset being net zero the asset is expected to last 60 years you have to talk about the embodied carbon,which for room2 Chiswick was 2,500 tonnes of carbon,as opposed to the operational carbon,which for room2 Chiswick is 15 tonnes of carbon.Unless you are detailing the embodied carbon it doesnt matter how much you have washed the towels dont tell me you are saving the planet by not washing my towel if you havent looked at the embodied carbon.”On the curve So how is the serviced apartment sector doing compared to hotels.“Some are doing better than others”says K2s Gavin Carruthers,“although the pace has accelerated in the last 12 months as weve moved on from planting a tree or working with utility providers to get hold of meaningful data.”“Some providers are now building their own carbon offsetting tools and providing the data that drives the conversation around what can actually be done.Its been fascinating to see this collaboration between different partners that we use in that field working together to try and find a solution.”Credit:Hybrid ResiJack RamseyCEOTripStax“The increase in demand for automated carbon,risk and wellbeing data is just one sign that the evolution we set out to kick start is underway and TMCs want to migrate towards using a centralised data warehouse as a single point of truth for managing and enriching their customers travel data.”15 https:/ 16 https:/ https:/ 202452TripStax is a technology company which works with Travel Management Companies(TMCs)and corporates to power global travel programmes.We provide ten cutting-edge modules,all connected to a vast data processing architecture.We also own a hotel booking platform,so I was interested to find out more about how serviced apartments differ from hotels in terms of automation and booking flows.Weve invested a lot into adopting Artificial Intelligence(AI)across our technology stack,and I know many other businesses are also taking advantage of the benefits it provides.Some are just using ChatGPT to answer questions,while others are surging ahead and embracing the full power of machine learning.To find out how AI might shape the world of business travel,we pulled together a panel of experts in serviced apartments and technology.It comprised of:Daniel Simmons,Chief Commercial Officer at HotelREZ;Hanish Vithal,Chief Information&Technology Officer at SilverDoor,and Joanna Cross,Chief Operating Officer at Ariosi.Why AI is essential for Gen Z travellers/assignees;why success is a blend of tech and humans and how AI can support operator and agency profitability/productivity.By Jack RamseyCEO,TripStax AI WHY THERES NO NEED FOR PANIC Starting the journey To start with,I wanted to find out what level the businesses on our panel were at in terms of adopting AI.Daniel:We havent even touched the tip of the iceberg with AI yet,because the landscape is so complicated.To start with,were looking at all of our different systems and how we can really attract the right business at the right price and the right personalisation for our client properties.We are looking at how we can use AI to analyse the data in our booking engine so that when someone does come to one of the booking platforms,they get the right messaging.Joanna:At Ariosi we are also trying to understand what its all about and how we might apply AI practically and tangibly,day-to-day,to create operational and process type administrative efficiencies.Within our OrbiRelo tech platform,were looking at how AI can not only save team time,but also deliver a better user experience for all who interact with it.Hanish:Our journey has begun,but we are also taking our time to understand the culture we need to bring into our company to implement AI.Its about agility and empowering people to use AI tools to make their jobs easier.You also need to be in a good place with your technology,people,and processes-which we are-before looking to layer AI on top.On Hanishs point,it seems many companies are struggling to harness AI because their foundational technology,data and processes arent well organised and the shop needs a little tidying up before they embrace the future.AI will only perform well if it sits on a solid base,so if the base is a mess,avoid making it messier with technology you dont yet fully understand.An opposing school of thought however,and one that TripStax is adopting,is the use of AI to help with foundational cleansing exercises.There are areas of our stack where were using AI to analyse and refine code or restructure databases.My point being there are use cases for AI in both the preparation phases and execution phases of its adoption.At this stage in AIs evolution,I do have respect for those who approach it with caution,if they dont fully understand the landscape.Its a powerful beast,not to be underestimated.Serviced apartment vs hotel booking experience Looking more closely at the serviced apartment world in particular,I wanted to explore its foundations and how it compares to the more standardised hotel booking space.TripStax is well versed in hotel booking,but I understand booking serviced apartments is a little less straight forward.I asked the panel why its more complicated and cumbersome to book serviced apartments and do they think AI can have impact on improving this?Daniel:Every serviced apartment provider we work with wants visibility of their product and their distribution is very fragmented.The have long and short stay guests and they want to get the right business.They have to have good PMS,CRM,and revenue management systems,and when each is a different system,it can overcomplicate things.The biggest barrier to serviced apartment operators putting availability online is around the mechanics of length of stay and lead time and protecting the opportunity to get a longer stay.The real benefit of AI will be to enable better human decision making.Hanish:It has been talked about in the serviced apartment world for years,but there has to be a centralised platform or distribution system.Simplicity should be the starting point;giving operators the right tools to do the job.Thats why we are so far behind hotels;they already make it simple and accessible.User/Guest experience vs.booker experience More than 80%of travel buyers think their corporate booking tools user experience is not fit for purpose.18 One of the reasons for this is that theres so much focus on the interconnectivity of all the data behind the scenes that the user experiences is just seen as a visualisation layer for all the chaos that lies beneath.Credit:The GateCredit:edyn18 Speaker at ITM conference 202455This work can be done without AI,but does the panel believe theres more that can be done from an AI perspective to improve the user experience?Daniel:Huge changes are coming to booking engines,led by what the airlines are doing with New Distribution Capability(NDC),which is to generate higher revenues.The other big change will be in relation to using AI to streamline processes.Sadly,this is also likely to mean cutting staff,because companies will look to use AI to cut costs.This is a valid point.At TripStax,we built a tool with AI to automate the gathering of content from different airlines from multiple channels integrated into one environment.We showed it to one of our large TMC customers and their reaction was that it could reduce their human resources by 70%.Joanna:Theres a big disparity between the user experience and the booker experience.In my private life,Im used to using multiple portals,the majority of which are slick and customer focused.But I think in corporate travel life,its fair to say that the portals we touch arent as slick,or as sharpened for the consumer,particularly when it comes to booking corporate,temporary accommodation.Theres a real disconnect there and room for improvement.This is also backed up by the results of this years GSAIR operator survey,where we can see the focus is very much on guest or end user experience,but not booker experience.Hanish:At SilverDoor we try to bring consumer grade applications to the corporate world because corporate tools are overly complicated.Its all about enriching the functionality so everyone can have a one click system,but its a challenge because we need data and content from different providers to make that efficient.You need content to create personalisation.Then you use AI to leverage the content to deliver the user experience.Its about streamlining everything and bringing it back to the reality of how we use our phones and apps.Someone needs to be brave and take a risk by doing something fundamentally different.Short staysthat stand out from the crowdStaycations or work relocations whatever the reason for your clients visit,our dedicated guest services team will make the experience seamless.Choose from distinguished Notting Hill townhouses,Mayfair apartments and Kensington mews homes and leave us to sort the rest.Get in touch for more details:020 8168 8880/“Success is a blend of people and technology.When you are going away for three,four weeks or even longer,the business traveller needs that human interaction because they need re-assuring,its part of the human condition to want to speak to someone.”“This is even more relevant in relocation,one of our clients is coming over from South Africa with his family for an extended period.Yes,they can find lots of information on our portal,but the portal cant tell our client which schools are the best locally.”Katie GarrahySenior ClientProgramme ManagerSilverDoor“Amongst TMCs,the current thinking is that AI will have its greatest impact on efficiencies.In the summer of 2023,we introduced live chat.Whilst not exactly AI,its a half way house to adopting AI within our customer experience,especially around contacting us.”“From the corporates side,theres a lot of nervousness around AI because of the external influences around the edge.Theres a risk to duty of care,so HR are involved.With infosec,security teams are involved.Not to mention sustainability teams,diversity,equality,and inclusion.”“We regularly interface with those teams around GDPR,data and where data is held.Our clients teams are getting to grips with what this all means.”Leanne FowlerDirector of Account Management Clarity Business Travel“From the customers perspective its a whole new experience with self-check-in,even before youve arrived.It becomes more difficult when youre trying to pick a restaurant or menu.Ive seen places trying to use AI for room service menus.When someone decides they dont want cheese on the burger thats a disaster.”“The principal benefit for us in implementing AI is a combination of guest experience and the bottom line,although by putting the former first,the latter tends to take care of itself.”John AngusManaging Director Switch ManagementGSAIR 20245657Join as we put a CEO in the spotlight HOT SEAT-WITH STUART WINSTONE OF SILVERDOOR Corporate demand for serviced apartments seems to be slowing again;what is driving demand right now?Its worth taking a moment to remember how things were the two years after the pandemic,at SilverDoor in 2022 we saw unprecedented levels of business which softened a little in 2023 and the landscape is somewhat less volatile now with markets adjusting to fluctuating demand in many locations.Its a good sign that the UK has recovered from the mild recession we saw at the end of last year and,if the last couple of weeks is anything to go by,I would suggest volumes are back on the rise and many customers are telling us the second half of the year is set to be busier.How will greater regulation(e.g.licensing)impact supply and demand?Greater licensing can have several implications for the serviced apartment industry and we definitely dont see it as a negative in principle.That being said,I think we need to be wary of being too heavy handed and placing too much financial and administrative burden on operators.We already have over 150 health,safety,and security measures that operators must meet if they want to join the SilverDoor portfolio.In addition to this,many of our clients actually have their own mandatory standards and features they require in all apartments,things like double locking doors,spyholes,fire blankets and carbon monoxide alarms.In most major cities,local regulation already demands these things,but when youre dealing with more developing countries its not always the case.So,we regularly find ourselves engaging with property partners in emerging markets where our clients have a demand and we advise them that should they wish to accommodate these customers,they will need to fit these features,which in most cases they are very happy to do.Therefore,we can and do see a natural improvement in safety and security standards a result of market pressure working hand in hand with formal industry-wide regulation.Regulation is not the answer to everything,and I think theres a balance there:overregulation can stifle innovation and diversity,it can increase operational costs,making it harder for operators to be profitable and can lead to homogenising the product and reducing choice and competition.One of the reasons people love apartments over hotels,is the unique,home from home environment they offer,so while regulation has its place in standardising our industry and driving best practice,lets not let it water down what makes our product special,and put off smaller,independent operators from entering the market by placing endless onerous requirements on them.How has SilverDoor tackled TMCs reliance on GDS to source and book serviced apartments?Weve been hearing from our clients for some time that online,live availability and instant booking capability is a non-negotiable,so we are continually developing our technology offering to increase the widespread accessibility of serviced apartments for corporate travel.The challenge for travel management companies has historically been the limited serviced apartment content available via the GDS.Our API solution presents serviced apartment content,aggregated from more than 2,600 global operators,next to hotel options on TMCs own platforms and allows bookers to directly compare rates,facilities and carbon emissions.The message from our clients has been clear for a long time:if serviced accommodation wants to compete with hotels,they need to exist in the same spaces,offer live rates,and have seamless,instant booking technology.This API brings the SilverDoor portfolio squarely into those spaces and is instantly available to view and book alongside hotel rooms.This represents a huge step in making serviced accommodation more easily accessible to relocation and business travel programmes and,for those that are unable to connect via the API at this time,our live rates and inventory are available at SilverD.Is it possible to meet the needs of travellers/assignees and their employers?Yes!Weve been doing this for nearly 25 years and of course sometimes it needs a careful balance and clear communication on both sides,but essentially there is usually a way.Were seeing an evolution in the needs of travellers,with the ongoing maturation of the digitally-native Gen Z and those born into an internet-enabled world.These generations now constitute a large proportion of our business travellers;they have different priorities from their parents,but,at the end of the day,people want to be treated as individuals and have an experience tailored to them,delivered with honesty,integrity and care.Is the serviced apartment industrys reluctance to share data hampering attempts to reach net zero?When we launched the SilverDoor Carbon Calculator in November 2023 we were very clear about our vision and ambitions for it:that we wanted to create a consistent,standardised approach to emissions measurement for the serviced apartment and corporate housing industry that we could all benefit from.We knew that sharing common best practice and data would be the key to widespread adoption we wanted operators to be able to enter their data once and for this to be shared across multiple agents platforms.Any solution that meant multiple platforms and multiple methodologies would be impractical and onerous for users to engage with,and for clients to understand.Having spent a year developing the Carbon Calculator technology,we want to make it widely and freely available and weve made this very clear to our agent colleagues,as well as a number of industry bodies.What are your predictions for the serviced apartment industry in the year ahead?We are confident that business travel and global mobility is on cautious yet positive trajectory.While overall travel volumes remain below 2019 levels,there is a noticeable uptick in demand from FTSE 250 and Fortune 500 companies,signalling optimism.Extended stay properties still continue to thrive across the world,as many travellers are taking fewer trips but for longer duration,using apartments for their cost reduction benefits,to aid sustainability goals and to nurture traveller wellbeing when away for long periods.Credit:The Capital Hotels,Apartments&Resorts59GSAIR 202458Global and regional economic,social&ESG trends;target markets,rates,and the ROI of serviced living.By George SellEditor-in-chief at International Hospitality Media LONG TERM FUTURE OF SERVICED APARTMENTSIn 2024,the serviced apartment sector is at a crucial stage of its evolution.The pandemic brought serviced apartments and aparthotels to the fore,allowing operators to continue trading,albeit in a vastly different landscape,while more traditional hospitality offerings were forced to close.In 2024,business travel remains unpredictable.Fewer but longer trips have become the norm,frequently with leisure and family time factored in.So,what does the next decade hold,and what changes will we see?More supply,more brands,smaller rooms Daniel Johansson,Director of Development and Acquisitions at Cheval Collection,predicts significantly more supply,more brands,and specialised chains with more properties.“I also expect to see a hotel-type rating system specifically for the sector.”James Fry,founder of Beyond Apartments&Aparthotels,believes the trend towards smaller room sizes should stop.“We should focus on what serviced apartments and aparthotels do best-larger rooms,with full kitchens that encourage longer stays,reduce operational cost,and increase bottom line EBITDA returns.This will attract more capital into the sector.”A more diverse audience Larry Korman,President of US-based AKA Hotels&Residences,is very upbeat about the future,and the industrys ability to attract a more diverse audience:“Thanks partly to the pandemic and the reduction of Airbnb in many major cities,serviced apartments are now a mainstay of hospitality.In the near future we will see more hospitality and investment companies launch higher-end extended stay serviced residences as preferred lifestyle alternatives to hotels that have become diluted by big-box mega companies such as Hilton and Marriott.”“We will see stronger demand for independent brands and properties that appeal to a sense of home,while offering resort-standard amenities and services.Those who have loved Airbnb are conditioned to the advantages of a residence rather than a room.Now theyve grown up,have finer tastes,and more money to spend.Corporate travellers will travel less and stay longer,so a place where they can eat,work and sleep is a great option.”Daniel Johansson predicts that brands will improve their penetration across Europe,and that:“well see operators expanding to have pan-European portfolios.In the US,there is potential for more high-end product in key cities.”“The European sector is still very fragmented”adds James Fry.“A handful of brands will become the go-to operators,with a mixture of smaller brands rising rapidly,along with an element of consolidation.”Sector has rested on its laurels Karen Hutchings,founder of consultancy Cobb&Hutch and former Head of Travel at EY,shares others optimism,predicts divergence within the business travel market,and sounds a note of caution.“Serviced apartments will become more significant for travel managers over the next ten years.Demand for Airbnb has started to infiltrate travel programs.Mobility is the bedrock of serviced apartments business,but many companies are already using them for transient travel too.”“Corporate mobility expenditure probably makes up 1015%of their total accommodation spend.That shows how much opportunity remains untapped.The sector needs to reach business travellers,and technology will be the means to do so,but they havent cracked that yet.”“Covid gave people the opportunity to test apartments for the first time.Since then the sector has perhaps rested on its laurels while the hotel sector has come back strongly.”Larry Korman agrees the sector cannot afford to rest on its laurels.“We must keep growing in quantity,and especially quality,but the onus is on us to evolve and enhance our offerings.Whether thats with food and beverage,amenities and services,technology,and wellness.At AKA,we have grown not based on length of stay or square footage,but how we create a sense of home,away from home.”To maintain its appeal to corporate travellers,travel buyers and TMCs,Chevals Daniel Johansson says the sector needs to improve product standards across the board.“A serviced apartment should not be a second choice for a traveller after searching for a hotel.Its essential to provide a good space to work from,with a desk,away from the bedroom.Finally,its essential to be competitive on pricing.”Credit:The Ascott LimitedLarry Korman President of US-based AKA Hotels&Residences“I seeserviced apartments becoming more luxe,more mainstay,and with wider appeal to a grown-up global audience.”Credit:The GateClaire Barrie Executive Vice President,Sales&Marketing Synergy“We have to diversify the audience because we have to be able to appeal to all.The way that we can do that is through investment in marketing and technology,balanced with that hospitality feel.”61GSAIR 202460Put technology at the coreDusko Kain,Corporate Land Supply Manager-EMEA at Flight Centre Travel Group warns theres work to be done around the identity of serviced apartments.“Fragmentation has reached the point of what is a serviced apartment?Its like Hoover and vacuum cleaners.Travellers,business,and leisure,need to be re-educated about the benefits of serviced apartments and aparthotels.”Kain also highlights technology as a major driver of future sector growth.“Operators need to come together to create a way for serviced apartment inventory to be bookable,on-line,for stays of up to 30 days as a direct connect into the GDS because they are losing market share to all the big chains.Travellers need to be able to make informed choices at the point of sale.”Claire Barrie EVP,Sales&Marketing at Synergy echoes the need for future investment into technology to ensure the longer term future of the sector,but not just around distribution technology.“As an industry we need to invest more in data protection and security.Like certification and compliance,it costs a lot of money,but we cant afford to cut corners in either area.”“We need to select technology tools that provide a multilayered approach to data security so that transactions are secure,fully compliant with international payment and data privacy standards.As yet,thats not happening.”Credit:PREM GroupCredit:Hybrid ResiJoin us as we put a CEO in the spotlight HOT SEAT-WITH STEVE FREY OF OASIS Why a stagnant global economy needs to start growing,and quickly The financial economic landscape is worrying in most global economies.What impact is that going to have in the short to medium terms in the UK and the U.S.?Most U.S.cities dont have the equivalent of,say Canary Wharf,where the demand is so focused on one particular area of a city.In the U.S.corporate housing operators will rent a handful of apartments in one location,a handful in another location and then disperse the demand around the city.So,depending on where the client may have needs you have something in all areas of the city,which is much harder to do if youre actually putting up a building.I dont know where development activity will take place,primarily because the economic outlook is so uncertain,especially when youre using private equity capital to build serviced apartments.They could wait to see where economic activity starts to improve before funding more buildings.How will the results of the upcoming US election impact the serviced apartment and corporate housing sectors?Canadian comedian Dave Chappelle was asked what the first thing hed do if Donald Trump gets elected.“Get a significant tax break”Chappelle replied.If Joe Biden is re-elected,his tax plan is to double capital gains tax.That could be stifling to corporate housing when there is pent-up demand but limited supply.That demand gave many people their best year ever in 2022,so if the central banks all over the globe start to raise interest rates,theres going to be an inflationary effect.If you stall the economy,the next thing is the biggest global employers start laying off tens of thousands of people,which slows relocation and mobility and hinders industry growth.What are your hopes and fears for the next 12-24 months?My hopes are my fears.We are in a stagnant economy which could become highly recessionary.My hopes are that theres no more war between Russia and Ukraine,or China and Taiwan,and the situation in the Middle East calms down.Then we can get interest rates down.On both sides of the Atlantic,tax policies more conducive to economic growth would give the serviced apartment market the boost it needs.Credit:B-Aparthotels63GSAIR 202462We wrap up this edition of GSAIR with some additional comments from our contributors.THE LAST WORD This year weve had an unprecedented number of buyers,intermediaries and operators take up our invitation to contribute to GSAIRs editorial.Unfortunately,weve not been able to accommodate them all in the compilation of our written articles,so weve created The Last Word,so they can do just that.“I dont see temporary living as something thats going to either go away or never be used again.There will be changes to the market;like providing assignees with new household goods because people dont want to ship their goods anymore.Assignees want to be more remote and more flexible.”Rico LopesDirector Supplier DevelopmentGraebel“Diversification has been good for the market.Some of the larger hotel chains now have one eye on the serviced apartment sector because they want a piece of the pie.Theyre investing in standalone residential properties which they are servicing.If anything good came out of Covid,it was the fragmentation of the workplace.Employees and contractors can work anywhere,stay longer,and have a mixture of business,which is a real benefit to a city like London.”Max SlaghtCo-FounderDomus Stay“In the Middle East,where most Rotana properties are located,demand is growing for serviced apartments with a twist towards hotels.A lot of our serviced apartment branded properties are located next to or near to a Rotana hotel,so our serviced apartment guests can use our hotels facilities.”Rick SchultheisArea Director of Sales UK,Ireland&NordicsRotana Hotels and Resorts “Our model is to lease residential properties.Theres massive demand and under supply of properties,so weve got a problem where our rents are skyrocketing every week.Im hearing stories of AUD100-200 per week increases because there is no knowing when new supply is coming into the market.Our corporate clients are having to react to that.”Duncan AdamsManaging DirectorAstra Apartments“Theres an awful lot of people that are still thinking about sustainability but are waiting for some silver bullet technology,but dont necessarily know what to do about it.”David James WrightPortfolio Development Manager&Sustainability OfficerMansley Serviced Apartments“Im not sure travellers needs have changed that much,although their expectations are probably slightly different from 15-20 years ago.They expect to walk in and be able to hook up to the Wi-Fi without any complications.They also expect therell be certain things in the fridge waiting for them when they arrive.Theres probably a keener sense of entitlement amongst people who travel these days,but the fundamentals remain the same.Is the apartment safe?Is it clean?”Daniel CocktonVP Global Travel ServicesWood PLC“To reach the next stage of ESG adoption requires collaboration between different sorts of organisations sharing data and showing how positive change does make a difference.Demonstrating whats working and what isnt,and how it can be done.This is not a tick box or a marketing exercise.This is something that really matters.”Gavin CarruthersPartner Relationship Lead EuropeK2 Corporate Mobility“To be honest Im surprised there hasnt been more consolida
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2024APACPUBLICATIONIN ASSOCIATION WITH3GSAIR 2024:APAC2GLOBAL SERVICED APARTMENT INDUSTRY REPORT APAC 2024 In association with our Platinum Sponsors:edyn,Oasis&The Oasis Private Collection,SilverDoorPublished by Ariosi Compiled by Travel Intelligence Networkwww.the- Designed in house at Ariosi Helen Ochoa DesignerDisclaimerWhilst every effort has been made to ensure accuracy,neither Ariosi nor Travel Intelligence Network can be held responsible for any errors or omissions.Confidentiality noticeCopyright 2024 by Ariosi(the Company).All rights reserved.This document or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the Company.The information contained within is strictly confidential and/or protected by law.If you are not the intended recipient of this document you must not make any use of this information,copy,store,disclose or show it to any unauthorised person.Report Methodology GSAIR APAC 2024 has been responsibly compiled by undertaking extensive research using primary sources including conducting interviews and curating and collecting self-written pieces from contributors both in and closely aligned to the serviced apartment sector.For this edition we have focussed on primary sources,with secondary sources kept to a minimum.Where secondary sources are used,information sources are fully attributed.Unlock your teams potentialSeamless and cost-efficient L&D servicesROI Increased revenue opportunities are the result of motivated and empowered teams.Feedback Translating data into tangible next steps for continual improvement and career growth.Customised training,workshops,courses,coaching and mentoring that is tailored to your preferences.Insights and AnalysisTransforming your training needs into measurable learning outcomes that benefit your business.Free ConsultationDiscovery phase to learn more about your team,your SMART goals and business needs.Email us for a free consultation to discuss your L&D requirements.Ariosi is an accredited member of ITOL,supporting the development and delivery of current content and learner experience.Bespoke L&D 44(0)20 8168 TH GSAIR 11 EDITION5GSAIR 2024:APAC4Acknowledgments and Editorial teamPage 05Welcome and introductionPage 06Its all eyes on IndiaPage 08The unique appeal of Tokyo and Japans Serviced Apartment MarketPage 10The growth and evolution of the serviced apartment industry in AustraliaPage 12How buyers and operators can work together to find balance Page 16Ascotts journey in Disability InclusionPage 18Glossary of termsPage 22Directory listingsPage 24CONTENTSACKNOWLEDGMENTS AND EDITORIAL TEAMMARK HARRISSupporting EditorTravel Intelligence NetworkMark joined the business travel industry in 1990,has been a Director of Travel Intelligence Network since 2005 and originated GSAIR.He was voted the business travel industrys Personality of the Year in 2006 and has notched up four Business Travel Journalism Awards.TINs output includes over a million words in reports,white papers and blogs,co-creation of the Serviced Apartment Awards and hosting many others.After lunch,he is chairman of the PitchingIn Northern Premier League and an FA councillor.JOANNA CROSSChief Operating OfficerAriosiJoannas journey in the hospitality sector began at the Four Seasons Hotel in Sydney in 2001.In 2005,she moved to London and joined the team at COMO Metropolitan Hotel.Her interest shifted to serviced apartments in 2006 when she joined SilverDoor.Transitioning to the operational side of the sector in 2015,Joanna gained experience at both Supercity Aparthotels and Clarendon Apartments over the course of several years.In 2022,she rejoined Habicus Group and later in November of the same year,launched Ariosi Group Limited,a specialist serviced apartment consultancy.Many thanks to our GSAIR APAC contributors whose time and input is highly valued.Our appreciation goes to:CECILIA CAI Partner Account Manager-APACSilverD DUNCAN ADAMSManaging DirectorAstra A.auKANA KUMOSHITACEOKADO-Mekado- SOFIA ORAGANOSenior Director International SalesSynergy Global H BEH SIEW KIMChief Financial and Sustainability Officer,Lodging,CapitaLand Managing Director,Japan and South Korea,The Ascott Limited 2024:APAC6Retain the flavour of the main GSAIR report When deciding upon topics for inclusion,were influenced by the findings of our main report,the GSAIR survey and results edition published in June 2024.However,were also open to new themes being introduced to enhance our breadth of opinion and keep things spicy.Weve found that there is plenty of correlation between regions and global themes,and its indeed interesting to see how the commonalities we see and are experiencing as an industry are manifesting themselves at a regional and local level.Successful formulaIn 2024 we struck upon a formula for our regional reports that was well received by our audience and that gave a tasty flavour to our regional pieces.We shied away from being just another source of industry news,and instead curated a series with guest contributors writing for us,from their perspective,in their own voice and words.Yes,they are opinion pieces,often supported by cold hard facts,but theyre real and lived experiences from a collection of specialists in various roles,across a selection of geographies,in our industry.We feel a handful of perspectives is just about right to ensure we deliver a collection of diverse,thought-provoking articles,with just enough content to stimulate our readership without being overwhelming.The pleasure is ours One of the most enjoyable parts of curating GSAIR is the process of sourcing our contributors,then deciding upon the topic(s)that light their fire,giving them a voice and concurrently serving the GSAIR readership community well.Sofia Oragano takes us on a journey to India whats driving demand,which cities are capitalising on the surge of interest in temporary living products,and what other factors need to be considered in the boom.Another country seeing a similar surge and period of growth and international interest is Japan;Kana Kumoshita shares her expert view to give us insight into a unique and appealing market.Next up we hear from Duncan Adams,who gives us an update on another region which is experiencing significant growth;Australia&New Zealand.He shares his insights on the challenges and opportunities afoot,and his tips for standing out in such a competitive landscape.Cecilia Cai,based out of Singapore,shares six pointers to aid collaboration between buyers and operators who need to balance cost and environmental considerations,across the region and beyond.Closing out GSAIR APAC for 2024,Beh Siew Kim shares the significant commitment her business has made in the area of disability inclusion a hugely important topic,particularly across a portfolio of almost 1,000 properties.Thanks for putting on your writing caps As with every edition of GSAIR,were thankful and grateful for our guest contributors who once again stepped up to fulfil the role of writers.Your enthusiasm for sharing your professional experience and expertise with us is very much appreciated and we cant thank you enough for delivering the goods.THANK YOU!Enjoy,and see you next year!To our GSAIR readers we hope you enjoy our final edition for 2024.Were looking forward to seeing where the industry travels to in 2025 Im sure therell be plenty to discuss as we navigate our way into the next quarter of the century.Take care,see you next year!Welcome to our second year of regional sub reports were closing out the year with GSAIR APAC!By JOANNA CROSS Chief Operating Officer,AriosiWELCOME AND INTRODUCTION9GSAIR 2024:APAC8As business travel and mobility accelerates throughout India,this rapidly flourishing powerhouse has emerged as the land of opportunity for corporateswith its serviced accommodation landscape growing right along with it.Whats driving demand for serviced accommodation in India?While Indias extended-stay accommodations are gaining momentum,they remain a relatively niche offering in this region compared with other major global markets.Despite this,demand has surged as corporate buyers acknowledge the role this accommodation type can play in achieving organisational objectives and mitigating cost leakage.This momentum comes as a consequence of various market forces including:The growth of key industries such as IT,finance,tech,semiconductor,manufacturing and pharmaceuticals Increased globalisation Growth in internship programmes Economic growth(GDP 8.7%in 2023)The development of commercial and tourism infrastructure The progression we are witnessing is underpinned by the governments ambitious plans to attract over USD 100 billion in foreign direct investment via the bolstering of key“engines”including physical/digital infrastructure,lifting up those at the bottom pyramid of the population,boosting manufacturing and making it easier to do business across the country.Sofia is the Senior Director for International Sales at Synergy,a global leader in serviced accommodation program management.Responsible for driving innovative client partnerships across the EMEA and APAC regions,Sofia shares her expertise across the business travel and serviced accommodation landscape within India.By SOFIA ORAGANO Senior Director,International Sales,Synergy Global HousingWhich cities are seeing the most growth?Bengaluru,Hyderabad,Mumbai and Pune are the cities driving the most demand for serviced accommodations as corporations race to scale their operations and reach this low-cost market known for innovation and access to talent.Where things really start to get exciting,however,is the growth of secondary locations such as Gurgaon,Chennai and Noida.Recently,these cities have emerged as key economic hubs across industries such as IT,manufacturing and finance,bringing with them an influx of diverse traveller demographics.This,combined with their strategic proximity to government and educational institutions,has created the perfect storm for a surge in supply and demand as businesses seek increased connectivity to the heart of Indias political and economic activities.Which factors are shaping the serviced accommodation industry?Increased demand for intern-friendly products Indias strong educational institutions,widespread English proficiency and strategic time zone has made its key cities a magnet for university graduates.As a result,the serviced accommodation industry has seen widespread demand for intern-friendly product types such as co-living,particularly across Bengaluru and Hyderabad.There is an opportunity for key players to cater to the enhanced requirements of interns through the streamlining of complex group accommodation processes.These may include the management of contracts,guest services and financial considerations.Domestic demand Gone are the days where demand for serviced accommodations across India came primarily from international executives and c-suites.What was once a market fuelled by demand for luxury accommodations,is now becoming a market in need of alternative solutions as traveller demographics and psychographics shift.Consequently,the supply of serviced accommodations which meet these diverse requirements of travellers will only continue to grow as investors and property developers target growing groups of consumers such as interns and graduates.An emphasis on cost containment The requirement for cost-sensitive accommodation solutions continues to be a priority across India,particularly among domestic buyers.While our industry recovered impressively from the COVID-19 pandemic,the longer-term effects remain in that travel budgets are coming under increased levels of scrutiny as the value of virtual working remains high.Today,corporates are increasingly required to contain costs and demonstrate the additional value of in-person trips,particularly as the concept of“purposeful travel”prevails.Despite this emphasis on cost sensitivity however,service providers and buyers must consider the“hidden costs”associated with cutting costs.Within India,for example,choosing a serviced accommodation option further away from ones place of work may be cheaper in terms of nightly price,but could have an impact on a travellers productivity due to additional commute times due to traffic and so on.Building bridges between quality standards Indias serviced accommodation sector currently exhibits a wide variation in quality levels,ranging from standard to luxurious high-end options.Typically,the expectations of an international traveller can differ widely to those of a domestic India traveller as it relates to accommodation quality.With the rise in international travel,the gap between high and low quality accommodations is expected to narrow as travellers,both global and local to India,seek a standard of accommodations similar to what they experienced in more advanced markets around the world.We should anticipate investment into the mid-range sector,particularly as international travel managers seek to optimise traveller productivity through enhanced comfort and wellness.Price versus availability Unsurprisingly,increased demand for serviced accommodation has led to a slight uptick in nightly rates.These price rises,however,remain moderate as new streams of supply constantly enter the market.This additional supply is mainly a result of increased investment from local property developersparticularly in high demand locations such as Bengaluru and Hyderabads IT parksas well as the globalisation of major hospitality brands and the emergence of new,alternative accommodation providers.An opportunity to push the boundaries of industry duty of care As we pointed out earlier,serviced accommodation is still in its infancy across India,particularly within secondary and third-tier cities.Now,as an increased number of international players enter the market,we will likely witness a shift in the management of industry duty of care.This shift should bring with it a period of innovation as brands seek to both standardise and level-up the wider industrys approach to apartment vetting in accordance with international duty of care obligations.ITS ALL EYES ON INDIA:WHATS DRIVING DEMAND AND WHICH FACTORS ARE SHAPING THE SERVICED ACCOMMODATION INDUSTRY?Credit:Astra ApartmentsGone are the days where demand for serviced accommodations across India came primarily from international executives and c-suites.What was once a market fuelled by demand for luxury accommodations,is now becoming a market in need of alternative solutions as traveller demographics and psychographics shift.GSAIR 2024:APAC1011KADO-Me is a specialist Japanese consultancy,based out of Tokyo.CEO Kana Kumoshita established the business to connect foreigners with Japan,whilst promoting economic development and appealing to investors interested in Japanese real estate and beyond.By KANA KUMOSHITA CEO,KADO-MeIn Japan,a country with language and cultural barriers,serviced apartments provide an ideal solution for foreign executives and expatriates who require a business-focused living environment.Japans serviced apartment market has a history of over 20 years,with major global providers like Ascott and Oakwood,as well as unique Japanese operators such as Mori Building and Enplus.Although serviced apartments are familiar to business professionals globally,Japans market differs from the U.S.and Europe in terms of legal procedures and required documentation.Partnering with a reliable service provider is crucial to ensure compliance with Japans unique regulations.This article explores five key aspects of Japans serviced apartment market from the perspective of KADO-Me,a service provider with years of experience supporting business professionals and international companies entering Japan.1.Growing demand and supply:market expansionDuring the pandemic,Tokyos serviced apartment market experienced a significant reduction in available properties.However,post-pandemic,demand has stabilised and even grown,driven by increased foreign investment due to the weakened yen,as well as a shift from long-term expatriate assignments(2-3 years)to shorter stays of around one year.The surge in inbound tourism has led to higher hotel occupancy rates and prices in central Tokyo,which has also driven demand for serviced apartments.Notably,newly opened properties with hotel licenses now offer stays from as short as one night,distinguishing them from traditional hotels.Serviced apartments offer privacy,spaciousness,and convenience,making them attractive for long-term stays for expatriates,international business professionals,and tourists who desire a comfortable,home-like environment with hotel-grade services.In 2024,two notable new properties joined the market:Hyatt House Tokyo Shibuya,opened in March 2024,offers well-equipped kitchens and comfortable living spaces ideal for long stays.Lyf Shibuya,set to open in November 2024,is a unique,co-living facility designed to attract young professionals and creatives.These new properties illustrate the continued growth and diversification of Tokyos serviced apartment market,providing options that cater to different needs and lifestyles.In addition,Mori Buildings Azabudai Project,a luxury serviced apartment complex scheduled to open in 2026,will provide about 160 units from studios to two-bedroom layouts,targeting affluent business professionals.This project represents both the expansion of high-end serviced apartments and the THE UNIQUE APPEAL OF TOKYO AND JAPANS SERVICED APARTMENT MARKET:AN EXPERTS PERSPECTIVEgrowth of Japans accommodation market.Another recent trend is the growing preference for one-and two-bedroom units in areas slightly outside central Tokyo,where rents are lower,as remote work becomes more common.2.Legislative landscape:overview of Japans rental regulations Serviced apartments in Japan are typically operated under the Ministry of Land,Infrastructure,Transport and Tourisms regulations,which require stays of at least one month and formal lease agreements rather than standard hotel contracts.Some foreigners may find the required documents and procedures for serviced apartments in Japan cumbersome,but this is due to the need for a lease agreement that supports“living”rather than“staying.”Japans 2018 Minpaku Law allows licensed properties to offer short-term stays of up to 180 days per year,provided they meet specific conditions and obtain special licenses.Rules vary by municipality,and recent demand for medium-and long-term stays among expatriates and business travellers has prompted an increase in serviced apartments with hotel licenses to maximize revenue.3.Growth and market opportunities:rise of high-end developments Mori Living,Japans leading serviced apartment provider,has spearheaded the growth of premium serviced apartments like the Azabudai Project,catering to executives,high-net-worth individuals,and domestic business leaders.These properties offer not only high-quality living spaces but also premium amenities such as concierge services and spa facilities.Credit:Quest Apartment Hotels The Azabudai Projects 160 units,with a variety of studio and two-bedroom layouts,are designed to meet the diverse needs of global clientele.The scale and ambition of this project reflect Mori Buildings confidence in Tokyos continued appeal as an international business hub.The Hyatt House Tokyo Shibuya,which opened in March 2024,and lyf Shibuya,set to open in November 2024,also illustrate the diversification of the serviced apartment market.Hyatt House provides a hotel-style apartment with full kitchens and spacious living areas,ideal for business travellers and long-term tourists.Lyf Shibuyas co-living design,with its vibrant shared spaces,is geared toward younger,creative professionals,offering a new option in Japans serviced apartment sector.4.Future predictions and challenges:adapting to competition and economic changes Tokyos serviced apartment market is expected to remain active for some time,but challenges persist.Competition among domestic and international operators is intensifying as the market expands.Rising costs for utilities,materials,and labour are additional concerns,and continuing to offer high-quality services and facilities will be key to maintaining a competitive edge.Currency fluctuations also impact corporate budgets,and further monitoring of exchange rates will be essential for companies managing expatriate housing costs.Credit:Mori LivingSome foreigners may find the required documents and procedures for serviced apartments in Japan cumbersome,but this is due to the need for a lease agreement that supports“living”rather than“staying”.13GSAIR 2024:APAC12Since 2001,Astra Apartments has specialised in accommodating corporate travellers in Australia&New Zealand.With privacy,space and convenience intertwined,professionals can live life seamlessly,even when away.Here,Managing Director Duncan Adams provides insight into the current market,and shares his recipe for standing out in a competitive industry.By DUNCAN ADAMS Managing Director,Astra Apartments THE GROWTH AND EVOLUTION OF THE SERVICED APARTMENT INDUSTRY IN AUSTRALIA Credit:Dao by DorsettAustralias serviced apartment industry is undergoing a period of significant transformation and growth.In the post-COVID landscape,this sector has seen a resurgence,driven by various factors,including the increasing demand for flexible and spacious accommodation options,the rise of remote work and extended business travel,and the growing preference for more environmentally sustainable accommodation options that offer home-like amenities for longer stays.Companies are seeking out this style of accommodation for both their domestic travellers as well as skilled workers coming in from overseas,and serviced apartments are playing a key role in accommodating this workforce.Demand drivers Among the industries driving the growth of the serviced apartment sector in Australia,construction,logistics and infrastructure stand out as the largest contributors.With infrastructure projects and warehouse automation booming across the country,there is a strong demand for short-term housing for project-based workers,particularly those moving from other states or abroad.Serviced apartments are ideal for these sectors,where employees often need longer-term accommodation for project durations,sometimes lasting several months or even years.These industries understand the value of additional living space,self-catering options and secure parking that serviced apartments provide.In addition,professional services,IT,and engineering sectors are also contributing to demand.Professionals in these fields often require temporary accommodation for business trips or relocations.Challenges and opportunities in the Australian market While the serviced apartment industry in Australia is experiencing growth,it is not without its challenges.State Government regulations,in particular,can be a significant hurdle and there is a lot of pressure building as government bodies try to find solutions to the highly topical housing crisis.Regulatory frameworks also vary widely from state to state.In some states,strata laws,which govern apartment complexes,can impose restrictions on short-term rentals,limiting the availability of units that can be utilised as serviced apartments.Moreover,licensing and operational restrictions are complicating business operations.Different states have different requirements,and navigating this regulatory landscape can be costly and time-consuming for businesses.For smaller operators,these regulatory challenges can be particularly daunting and as a result,some have been forced out of the market.Larger players with more resources are better equipped to handle the complexities and absorb some of the additional costs.On the other hand,these regulatory obstacles also present opportunities for businesses that are able to navigate them effectively.Companies that can establish strong relationships with local governments and strata bodies and adapt to the specific regulations in each state are well-positioned to thrive in this fragmented market.Standing out in a competitive market As demand grows,so does competition,so its essential to know who the differentiator is.From its beginning in 2001,Astra Apartments carved out a niche by focusing solely on the corporate sector.By providing a specialised service that caters exclusively to business travellers and the companies they work for,we differentiate ourselves from competitors who may also serve retail clients and short stays.From a product perspective,its about full-sized apartments,with spacious living areas,full-sized kitchens,internal laundries and work desks.Our 24/7 meet&greet service and apartment orientation remain highly valued by our clients,as well as maintaining stable rates for our corporate customers when leisure-based events like the Australian Open or Melbourne Grand Prix are in town.The role of intermediaries and direct relationships Direct client relationships have always been a crucial source of business for many Australian serviced apartment operators.However,increasingly Travel Management Companies(TMCs)and Relocation Management Companies(RMCs)are being engaged for their services and are playing an essential role.Since the end of COVID,we are seeing many more corporates engaging TMCs to facilitate and run their accommodation programs.In turn,many TMCs are turning to Online Booking Tools that allow their clients staff to self-book all travel needs,thereby streamlining the booking process.Many companies have a hybrid model,where some bookings come directly and others through intermediaries.Navigating,understanding,and respecting the boundaries of these models is key.What are guests/clients demanding in the Australia/New Zealand region?With remote and hybrid work now the norm,theres an increased emphasis on seamlessly integrating work and living environments,especially when its a long-term stay.At the forefront of these expectations are dedicated workstations within the apartment because they offer a clear distinction between professional and personal spaces.No longer is a dining table in the apartment sufficient for the rigours of remote work;Credit:Astra ApartmentsCompanies that can establish strong relationships with local governments and strata bodies and adapt to the specific regulations in each state are well-positioned to thrive in this fragmented market.15GSAIR 2024:APAC14instead,corporate travellers now seek full-sized desks,ergonomic chairs,reliable and dedicated Wi-Fi,and ample power outlets to support their work-from-home needs.In general,companies are paying more attention to the mental and physical wellbeing of their travellers.As such,decision-makers are looking for accommodation options with sufficient space and amenities like full-sized kitchens to help maintain a sense of balance and normal life.Buildings that include amenities like gymnasiums,pools,and wellness spaces are also a big draw card,as well as locations that provide good access to transport,restaurants,shops,green space,and entertainment.Environmental sustainability Similar to other regions,there is a growing focus on sustainability.When compared to hotel-style accommodation,Corporate Apartments have a lower carbon footprint.Corporate Apartments offer weekly cleans compared to daily hotel cleans,timers on air-conditioning compared to 24/7 air conditioning throughout the entire hotel,plus low flow water systems and facilities to cook from home(to name a few).In addition,Astra Apartments are located in buildings with double-glazing and features like block-out curtains that provide better insulation in Australias harsh climate.What are your future predictions for the industry?The serviced apartment industry in Australia&New Zealand is robust and evolving.While challenges such as regulatory hurdles and the tight rental market remain,the sector is well-positioned for continued growth.As businesses continue to bring in skilled talent from overseas and domestic corporate travel rebounds,demand for serviced apartments is expected to remain strong.In the coming years,we anticipate an increased focus on technology,sustainability,and cost containment in the serviced apartment industry.Clients are becoming more discerning,demanding better technology solutions,environmentally friendly practices,and cost-effective options.The ability to meet these evolving demands will be key to staying competitive in this dynamic industry.As Australia continues to recover from the impacts of COVID-19 and addresses its ongoing rental housing challenges,the serviced apartment sector will remain an essential part of the countrys accommodation landscape,offering flexible,convenient,and high-quality housing options for both corporate and leisure travellers.GSAIR 2024:APAC1617SilverDoor opened their first international office in Singapore in 2016 and over the last eight years their APAC base has gone from strength to strength.Cecilia Cai oversees partner relations in the region and shares her top tips for managing both environmental and cost considerations.HOW BUYERS AND OPERATORS CAN WORK TOGETHER TO BALANCE COST REDUCTION WITH ENVIRONMENTAL SUSTAINABILITYBy CECILIA CAI Partner Account Manager-APAC,SilverDoor While accommodation rates in most key APAC locations have declined a steady 7%since this time last year,we anticipate ADR to plateau into 2025 and dont expect any dramatic movement for the coming quarter at least.That being said,intense scrutiny on budgets remains as many businesses look to reduce or maintain travel expenditure in 2025.Businesses are also doubling down on their emissions reporting and reduction goals.Asia Pacific has a critical role to play in reducing global emissions,and most nations have committed to GHG reductions in some form.Singapore has long been regarded as a pioneer in sustainable economic development,with renewable energy and rainwater harvesting commonplace here;recent legislation in Hong Kong and Thailand are also harbingers of more widespread measures that we only expect to increase in the coming months and years.Its widely believed that more sustainable choices come at a premium.Corporates who want and need to choose the sustainable option are often limited by tight budgets and,when under pressure to demonstrate savings,its natural to opt for the lower nightly rate rather than the lower nightly emissions.Choosing a serviced apartment over a hotel is already a good start though.Apartments often offer better commercial value than hotels,particularly for stays of 14 nights ,but SilverDoor Carbon Calculator data consistently shows that apartments can be over 50%less costly from an emissions perspective too.Credit:Astra ApartmentsSilverDoor Carbon Calculator data consistently shows that apartments can be over 50%less costly from an emissions perspective too.So,assuming youre already using apartments,what can you do to achieve both commercial and environmental goals?1.(Unit)size matters:Some clients are re-examining their no studio policy to keep nightly rates down,others are looking at two-and three-bedroom units where colleagues can share.Both options can have a significant impact on both the bottom line,and on the carbon emissions of your stay.SilverDoor Carbon Calculator data suggests a two-bedroom apartment emits significantly lower emissions than two studios or two one-beds.2.Stay for longer:Combining several trips into one can offer many benefits:fewer flights mean fewer emissions and time lost in transit,longer bookings often benefit from lower rates,and it can also safeguard availability in busy times or locations.Its often easier to shorten a longer stay,and more flexible cancellation policies can be enjoyed in certain locations.Your agent can advise on cancellation policies if your schedule may be subject to change,but we encourage bookers to err on the side of a longer stay and shorten a trip if needed.3.Buy local and eat in:Buying groceries for the duration of your stay is more cost-efficient than eating out or grabbing food on the go.Many operators make it easy for travellers to eat in by either providing welcome boxes with some groceries or essentials,or by offering on-site pantries.A small,well-planned grocery shop can go a long way to save money,reduce waste and promote a healthy,balanced diet.4.Be flexible on location:We can always advise on suitable,close-by alternative locations with good public transport links within a given commute time.For example,North Sydney or Chatswood are easily commutable to Sydney CBD within 20 minutes and many properties around Orchard or River Valley in Singapore offer free shuttle buses to core office locations across the island.5.Plan ahead and be flexible:Enquiring 4-6 weeks before you want to travel will secure the maximum choice and best rates.Advise your agent of flexible travel dates,so we can look at /-2 days either side of your ideal travel dates to find lower rates.Operators can support this to fill available rooms by making practical suggestions of small changes in stay dates or room types that they may be able to offer at a reduced rate.6.Be decisive:Be clear on the priorities for your accommodation so your options are suitable and you can get it booked right away.Time delays while bookers decide,or shop around to see if they can get a better deal,are usually fruitless and their original option may no longer be available when they eventually go to book.In the words of one of our agents:“Trust us and our recommendations;if we say its the best option for you,then it probably is”.Credit:Far East HospitalitySilverDoor top tip:Tuesdays&Thursdays are often the most cost-effective days of the week to travel.Its important for buyers and businesses to ensure rate caps and policy reflect corporate priorities,both facilitating and incentivising sustainable or cost-conscious choices where possible.Rate caps can go out of date,so benefit from regular reviews against market rates.Our experience shows that the premium associated with eco-friendlier apartments is minor,and a slightly more generous rate cap is likely to mean more opportunity to book the greener option.If your people are prepared to stay in a more modest apartment,cook meals in-house,share units with colleagues,or consider a longer commute,how can these responsible behaviours be recognised and rewarded?Some companies are awarding points or vouchers when staff save against financial budgets or make greener choices,and savings are sometimes recognised in charitable donations.And for operators:please challenge the status quo and consider offering options with fewer frills.An upcoming launch from Frasers is the Premium Rental Apartments solution,designed with the more self-sufficient or cost-conscious guest in mind,it offers no breakfast and less frequent housekeeping.The option to choose less regular servicing with associated lower nightly rates is something we would like to see more of.There are carbon emissions reductions to be realised here as well,but anecdotal feedback from operators in APAC is that initiatives like these have been met with pushback from guests who seem to expect more regular servicing as standard.This contrasts with our experience in EMEA where daily servicing is considered unnecessarily wasteful and costly,and weekly servicing is the norm.Against a backdrop of financial and environmental scrutiny,can we afford to ignore this opportunity to make a measurable difference?GSAIR 2024:APAC1819With over 1 billion people or about 15%of the global population living with permanent disabilities,and up to 40%of people requiring accessible services at some point in their lives,enhancing accessibility has become a critical priority for a global hospitality company like Ascott.Meeting the needs of this demographic not only attracts guests with disabilities but also expands outreach to their caregivers and companions.Furthermore,guests with disabilities tend to be loyal and high-value customers,often staying longer when they find suitable accommodation.Prioritising accessibility,therefore,not only makes sound business sense for Ascott but also contributes to fostering a more compassionate and inclusive society a mission that the company is passionate about.The Ascott Limited(Ascott),the lodging business of CapitaLand Investment headquartered in Singapore,manages a portfolio of more than 960 properties in over 40 countries.Ascott are committed to promoting inclusivity and accessibility in the hospitality sector,as both a strategic business initiative and a social responsibility.A COMMITMENT TO#ASCOTTCARES:ASCOTTS JOURNEY INDISABILITY INCLUSIONBy BEH SIEW KIM Chief Financial and Sustainability Officer,Lodging,CapitaLand Managing Director,Japan and South Korea,AscottThe Evolution of Ascotts Accessibility JourneyAscott is continually exploring ways to enhance the accessibility of our properties to improve the guest experience.For instance,in 2017,Ascott Orchard Singapore became the first serviced residence in the country to receive the Universal Design Mark Platinum award from the Building and Construction Authority,recognising its outstanding accessibility features.While Ascotts properties across various countries establish their own accessibility standards tailored to local contexts,there has yet to be an overarching framework that unifies these efforts and ensures consistent implementation of best practices throughout the company.This includes not only the physical The signing of MoU between Ms.Beh Siew Kim,Chief Financial&Sustainability Officer,Lodging,CapitaLand Investment(left)and Ms.Ku Geok Boon,Chief Executive Officer,SG Enable,was witnessed by Mr.Eric Chua,Senior Parliamentary Secretary,Ministry of Culture,Community and Youth Ministry of Social and Family Development.modifications often referred to as the hardware but also the commitment to fostering respect and understanding for persons with disabilities(PWDs),known as the software,which is essential for creating a truly inclusive environment.Ascotts inclusivity journey gained new momentum after I was inspired by a Singapore Tourism Board conference on inclusive hospitality in 2023.Soon after,we launched Ascotts Accessibility Roadmap and formed an Accessibility Taskforce to oversee its implementation across five key pillars:Inclusive Spaces,Programmes,Digital Interfaces,Hiring and Training.Since then,Ascott has embarked on multiple initiatives,collaborating closely with SG Enable,Singapores focal agency for disability and inclusion.This partnership In Australia,Quest Apartment Hotels,a member of Ascott,is improving the accessibility of its hotels in partnership with Accessible Accommodation.led to the signing of a Memorandum of Understanding(MoU)between the two organisations aimed at promoting workforce diversity and establishing standards for accessible accommodation in the hospitality industry the first of its scale in Singapore.Outside Singapore,Ascott clusters in different regions are partnering with their local agencies.Together,Ascott and our partners plan to develop a global playbook by 2025 to guide disability inclusion efforts across Ascotts properties worldwide.Ascotts Accessibility Roadmap Inclusive SpacesIn Australia,Ascott has partnered with Accessible Accommodation,a leader in the accessible sector.Key initiatives include a comprehensive guide for implementing accessible practices across all properties of Quest Apartment Hotels,a member of Ascott.Ascott Australia has also adopted Accessible Accommodations independently reviewed three-tier accreditation system,displaying accreditation seals on its website and on-property.Staff members undergo inclusion training to enhance their delivery of an inclusive guest experience.Additionally,Ascott Australia collaborates with Accessible Accommodation to conduct property audits and improve accessibility at existing locations.Accessible Accommodation also provides consultation on all new builds and fit outs for Ascott Australia to enhance the functionality and aesthetics of accessible rooms.In Singapore,Ascott is enhancing accessibility for a diverse range of disabilities by partnering with SG Enable to conduct site studies.Earlier this year,Ascott Orchard Singapore hosted three PWDs,each representing different disability types,to gather their feedback on the propertys accessibility features and services.This valuable input will be incorporated into the Asset Enhancement Initiative plan for Ascott Orchard Singapore.Ascott will continue to work closely with global partners to establish standards and provide guidelines for inclusive designs across our properties worldwide.Inclusive Programmes Ascott is committed to introducing inclusive programmes suitable for all guests.One example is“lyf Sustainival”,a sustainability carnival hosted by Ascotts lyf properties in Singapore.This years event showcased innovative 3D-printed assistive tools and featured Singaporean Paralympic medallist Theresa Goh,highlighting the achievements of the disabled community.We have also reviewed Ascotts Corporate Social Responsibility initiatives to enhance support for PWDs.For instance,more than 60 associates from Ascott Singapore took part in this years Purple Parade,Singapores largest movement dedicated to promoting inclusion and raising awareness for PWDs.A year after being inspired by the annual inclusive hospitality event organised by the Singapore Tourism Board,Ms.Beh Siew Kim(centre)returned to the Sustainable Tourism Conversations in 2024 to share Ascotts journey towards promoting accessible accommodation.21GSAIR 2024:APAC20Ms.Anne Azman,a deaf graphic designer at Ascott Malaysia,shares,“Beyond workplace design and accessibility,I value the supportive and inclusive culture within the organisation.Ascott Malaysia organised awareness sessions to educate associates on disability inclusion and promote empathy and understanding.I feel loved by my colleagues,who value my efforts and recognise my talents.”Inclusive Digital Interfaces Acknowledging the importance of inclusive digital interfaces,Ascott has been enhancing the design of our website www.DiscoverASR.com to align with the globally recognised Web Content Accessibility Guidelines set by the Worldwide Web Consortium.These improvements aim to simplify the user experience and enhance accessibility features.Inclusive HiringAscott has signed the Enabling Employment Pledge by SG Enable,reaffirming our commitment to creating accessible workspaces and supporting global employment opportunities for the disabled community.Job roles have been redesigned to attract and retain associates with disabilities.Additionally,the Ascott Accessibility taskforce participated in workshops on job accommodations to better support these associates.An example of Ascotts commitment to inclusive hiring is the story of Anne Azman,a deaf graphic designer at Ascott Malaysia.Anne utilises visual aids,sign language posters and digital messaging systems to communicate effectively with her team.Her office has invested in various technological and assistive devices to enhance her productivity and efficiency.Furthermore,her team has provided training on basic sign language to associates,fostering a culture of empathy and support within the workplace.Inclusive Training Ascott recognises that creating an inclusive environment requires a strong foundation of engagement and understanding among employees.In March 2024,Ascott associates participated in a Disability Awareness Talk,which provided an overview of various disabilities and essential disability etiquette.This was followed by a Disability Management Workshop,where associates learned Ascott associates took part in a Disability Awareness Talk,which offered valuable insights into various disabilities and essential disability etiquette,fostering a more inclusive workplace culture.effective strategies for confidently interacting with and integrating PWDs into the workplace.To uplift and upskill the wider industry,Ascott and SG Enable will jointly develop and deliver essential resources and disability inclusion training tailored for the hospitality industry at the Ascott Centre for Excellence(ACE),Ascotts global hospitality training centre dedicated to developing human capital for the hospitality industry.Challenges and Opportunities Creating inclusive spaces presents several key challenges,such as balancing the needs of hearing-impaired guests and those with sensory sensitivities.The absence of international accessibility standards further complicates the establishment of a universal standard across Ascotts global properties.One practical solution is to design properties with a variety of accessible room types tailored to specific disability needs.Through offering diverse accommodations,Ascotts lodging properties can better serve guests with physical,sensory and cognitive requirements.We will continually refine Ascotts inclusive spaces by incorporating feedback from PWDs and staying informed about the latest advancements in accessible design.Conclusion At Ascott,we understand that creating an inclusive and accessible environment is an ongoing journey,and we recognise there is more to be done.We are actively addressing the needs of PWDs through targeted initiatives,in collaboration with experts like SG Enable.Our commitment to inclusion is embedded in#AscottCARES,our sustainability framework that aligns our growth strategy with environmental,social and governance considerations.As we strive to build a more inclusive environment for both guests and associates,we remain dedicated to continuously improving and evolving our efforts.This is a process we are fully committed to,and together with our partners,we look forward to achieving meaningful,lasting change.Short staysthat stand out from the crowdStaycations or work relocations whatever the reason for your clients visit,our dedicated guest services team will make the experience seamless.Choose from distinguished Notting Hill townhouses,Mayfair apartments and Kensington mews homes and leave us to sort the rest.Get in touch for more details:020 8168 8880/GSAIR 2024:APAC2223GLOSSARY OF TERMS ADR:Average Daily Rate.Agent:Used more generally to describe an intermediary,either individual or company,booking travel or accommodation on behalf of another party.AI:Artificial Intelligence.APAC:Asia-Pacific.Aparthotel:Fully furnished and equipped apartments,which include hotel services such as manned reception and cleaning.Typically used for shorter stays and suitable for business and leisure use.ASAP:Association of Serviced Apartment Providers.Assignment working:A short or long term stay,undertaken to perform a specific task or project based trip.Stays can last between 30 days and three years and are temporary,whereas Relocation(see below),is permanent.Assignment workers are often referred to as assignees.Business travel:Journey specifically taken for work purposes,usually but not always up to seven days.Business travel excludes daily commuting,leisure trips or holidays.CBD:Central Business District.CHPA:Corporate Housing Providers Association.Co-living:Co-living refers to accommodation where multiple unrelated people can live together.Units usually contain large communal spaces as well as private bedrooms.Developments often feature social areas and programmes designed to foster a sense of community.Corporate housing:Residential apartments,packaged up to include servicing and bills,typically bookable for a minimum of 30 nights,either let and maintained by the operator on an ongoing basis or rented specifically for a particular housing requirement and length of time,after which they are handed back to the owner.Corporate housing is also the term used in the U.S.to describe serviced apartments.CRM:Customer Relationship Management.DE&I:Diversity,Equity,and Inclusion(also referred to as EDI).Digital nomad:A person who travels freely while working remotely.DSP:Destination Service Provider.EMEA:Europe,the Middle East,and Africa.ESG:Environmental,Social,and Governance.F&B:Food and Beverage.GDP:Gross Domestic Product.GDPR:General Data Protection Regulation.GDS:Global Distribution System(e.g.Amadeus,Travelport,Sabre).Gen Z:Generation reaching adulthood in the second decade of the 21st century.GHG:Greenhouse gas.GSAIR:Global Serviced Apartment Industry Report.Homestay:Generic term for products like Airbnb,or home rental.IATA:International Air Transport Association.ITM:Institute of Travel Management.LATAM:Latin America.LOS:Length Of Stay.M&A:Merger and Acquisition.NDC:New Distribution Capability.OBT:Online Booking Tool.Occupancy:Percentage of occupied bedrooms/apartments during a set period.OTA:Online Travel Agent(e.g.Expedia,B).PMS:Property Management System.PWD:Persons With Disabilities.Relocation:Relocation(also referred to as Relo),involves permanently moving an employee,and family,to another city or country.RevPAR:Revenue Per Available Room.RFP:Request For Proposal.RMC:A Relocation Management Company provides outsourced relocation logistics management for organisations of different sizes and needs.ROI:Return On Investment.Serviced living:Generic term to describe the expanding number of emerging extended stay concepts.Fully furnished accommodation including kitchen facilities,with some private and communal spaces.TMC:A Travel Management Company manages the business travel requirements of an individual or organisation,in line with their corporate travel policies,where relevant.Several acronyms or abbreviations are used in this report.These are as follows:GSAIR 2024:APAC2425Adagioadagio- 33(0)1 55 26 32 00 Discover Adagio.The city made easy in comfortable flats with services included.Choose from over 125 aparthotels in the heart of the cities.AptsLatam 57 320 339 7773AptsLatam,an award-winning provider of corporate housing and serviced apartments in Latin America and the Caribbean,offers tailored solutions and first-class support for single and group moves,ensuring a seamless experience.A 44(0)20 8168 8168A specialist serviced apartment consultancy and the home of OrbiRelo and GSAIR.We aspire to be the place you come to access accurate and up to the minute insights,advice,support,and training resources.Astra Apartments .au 61(0)2 8231 6624 Since 2001,Astra Apartments has specialised in creating better experiences for extended stays.Our urban footprint extends over 550,full-sized corporate apartments in major cities across Australia and New Zealand.dluxSuites 1 248 676 0876We are redefining corporate furnished housing by curating memorable experiences one luxury stay at a time.Domus S 44(0)20 8168 8880Short stays with a difference.Domus Stay brings together exceptional,design-led homes across London with dedicated guest services and handpicked experiences from its black 44(0)117 242 0492Edyn combines boutique hotel design with serviced apartment flexibility in a trailblazing aparthotel concept,creating vibrant,local experiences.The hybrid approach meets modern travellers needs,defining the future of serviced apartments.Hybrid Resi 44(0)20 3488 2904We are a UK-based company offering serviced apartments in Greater London.Our modern,fully furnished accommodation combines hotel conveniences with extra space,comfort,privacy,and amenities like split-screen monitors for remote work.Mansley Serviced Apartments 0800 304 7160Mansley Serviced Apartments currently operate seven properties across London,Edinburgh,Inverness&Cheltenham.Oasis 44(0)20 3608 1863(International HQ) 1 813 489 5144(US HQ)As a leading global temporary housing agency Oasis connects you with over 600,000 units.Our dedication to quality control and ongoing service throughout ensures you always have an extraordinary stay.OrbiRelo 44(0)1524 428 298 A versatile multi-agent aggregator platform which specialises in temporary living accommodation solutions.Access to over 1 million temporary living properties globally via multiple agents.Powered by technology.Superpowered by humans.PREMIER SUITES 44(0)151 227 9467Spacious serviced apartment living in 15 hand-picked city destinations.Ireland United Kingdom Continental Europe Bringing home a little closer.SilverD 44(0)20 8090 8090The worlds leading corporate accommodation agent providing businesses across the globe with an unrivalled service and intuitive technology for an outstanding booking experience.The Residence 44(0)20 7052 4527 The Residence offers modern,spacious serviced apartments with sleek interiors,equipped kitchens,and luxurious queen beds.Centrally located in London for business,relocation,or vacation.Your home away from home!DIRECTORY LISTING 27GSAIR 2024:APAC26A versatile multi-agent aggregator platformwhich specialises in temporary living accommodation solutions.Powered by technology.Superpowered by Temporary Living Technology Multi Agent SolutionAccess to over 1 million temporary living properties globally via multiple agents.Global LeadersAward-winning global team with decades of experiencein temporary living.Money Saving Experts Competitive pricing,cost savings,and solution diversity.Never compromising on quality.SanctuaryAMSTERDAM|BERLIN|CAMBRIDGE|DUBLIN|EDINBURGH|THE HAGUE|LISBON|LIVERPOOL|LONDON|MANCHESTER|MUNICH|ZURICHedyn is pioneering a new era of hospitality,blending the comforts of home with the amenities of a hotel.The company develops,owns,and operates an expansive portfolio comprising 3,468 keys across 23 properties in prime locations.The Locke brand boasts 2,875 keys and 16 properties,while the Cove brand encompasses 593 keys and 7 properties.With a focus on design,technology,and exceptional service,edyn offers a truly unique and enriching experience,redefining the way we live,work,and explore our cities. 44(0)117 242 0492|salesedyngroupSoulful hospitality and sanctuaries.Wittenberg by Cove Plantage|AmsterdamEmber Locke Kensington|LondonTuring Locke Eddington|CambridgeCove Centrum Passage|The HagueCove Landmark Pinnacle Canary Wharf|LondonWunderLocke Sendling|MunichGSAIR 11 EDITION TH trusted guide to the serviced apartment industryCREATED WITH CARE,BY INDUSTRY EXPERTS,WITH REAL EXPERIENCE
2024-12-09
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ATTRACTING TALENTRETAINING TALENTCULTIVATING TALENTBelow 5 mn:54%5.01-10 mn:14%Below 500:49%10.01-50.
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REPORTSavills ResearchT H E S K I R E P O R TW I N T E R 2 0 2 4/2 5Three words stand out this year from ourskireport normality,unpredictabilityandsustainability.People quite rightly want to forget the global pandemic that turned the world upside down between 2020 and 2023,but its effects will long be felt.Alpine and North American resorts both witnessed stratospheric price growth during this period,which only began to temper in 2023.The first half of 2024 followed a similar pattern less demand on account of strong pricing,persistently high interest rates and continued global uncertainty.Or,given what we have witnessed in recent years,conditions that could reasonably be described as“normality”.The second half of 2024 has,however,yielded a softening of interest rates on both sides of the Atlantic.It should be of no surprise,therefore,that asking prices across the prime resorts surveyed,while they declined by an average of 4%in 2023,increased on average by 3.8%in 2024.Although the overall trend is up,there are many variations to this for example,asking prices in Courchevel 1850 were up by 30%,but down in Vail by a similar amount.Asking prices are not the only unpredictable finding from this years report.Mountain resort operators increasingly have to be prepared for unpredictable weather.Savills Ski Resilience Index,now in its sixth year,illustrates how the unpredictability of snowfall,temperatures and season length causes significant annual variations.This year,its long season and snowfall reliability helped Breuil-Cervinia to edge Aspen off the top spot.Another high climber is Val Thorens,rising an impressive ten places to third,on account of a long season and higher-than-average snowfall.Whatever the altitude,season length or average temperature,all ski resorts are striving for sustainability.This not only means boosting their eco credentials(such as solar panels on the roofs of ski lifts),but also investing for a sustainable and resilient future.With an increasing number of resorts becoming genuine year-round communities and attracting a higher number of permanent residents,more diverse facilities such as international schools and wellness/medical retreats are emerging.We hope that you enjoy this 19th edition of our annual ski report.Ourresearchers report overleaf that meteorologists are forecasting a LaNia winter which typically brings colder temperatures.We are holding them to their word.F O R E W O R DJEREMY ROLLASONHead of Savills SkiCO NTENTS4-5Market OverviewSki numbers are returning topre-pandemic levels.Howareregions responding?6-7Prime Price LeagueGlobal prime residential property markets remain resilient.Which market comes top?8-9Ultra-Prime and OutlookThe summit of pricing.Andwhichmarket has clear runsahead for next year?1 0-1 1Ski Resilience IndexInconsistent snowfall and the whims of the weather have been a challenge for the industry since the advent of alpine sport1 2-1 3Aprs-Ski IndexAfter a day on the slopes,whichresort offers the bestaprs-ski environment?1 4-1 5Summer OfferingsThe evolution to year-round destinations1 6-1 7Infrastructure InvestmentUpgrades,improvements,andreaching new heights1 8-1 9Our Ski Experience and ContactsOur team and areas ofexpertise3T H E S K I R E P O R T 2 0 2 4/2 5P E A KC L I M B I N GT O T H EM A R K E T O V E R V I E W ki tourism has largely returned to normal,more than four years after the upheaval caused by Covid-19.The2022-2023 winter season recorded more than 370 million skier days internationally,according to LaurentVanat,marking a return tothe pre-pandemic average.Skiing continues to play a vital role in many mountain economies worldwide and visitors to these destinations provide significant economic benefit.Mindful of the climate challenges,the winter sports industry is striving to adopt a sustainable four-season approach where possible.Resorts around the world continue to invest heavily in infrastructure,from new lifts to snowmachines,in an effort to support both their sustainability goals and the ever-increasing numbers of skiers globally.Many markets were affected by warmer temperatures and lower snowfall as a result of the El Nio weather pattern during the 2023-2024 ski season,but as the 2024-2025 ski season approaches,meteorologists are forecasting thata La Nia winter is approaching along with it.La Nia typically brings colder temperatures;while not guaranteeing snow,it potentially bodes well for the coming season.S4T H E S K I R E P O R T 2 0 2 4/2 54Europes ski season presented a mixed picture.Many resorts faced variable weather patterns,limiting season length in 2023-2024,even though overall season lengths are growing.Themarket is driven by both domestic and international visitors,with Europe being a year-round tourist destination.However,climate change and rising temperatures pose challenges to lower-altitude resorts,leading to increasing investment in snowmaking technology and all-season tourism to sustain growth.Overall,the 2023-2024 season reflected a resilient ski industry,adapting to challenges and offering a promising outlook for ski enthusiasts in Europe.E UR O P EThe Asia-Pacific ski market has grown significantly in recent years,driven by rising disposable incomes,expanding tourism,and increasing regional interest in winter sports.Japan,South Korea,and China are leading the region,offering world-class ski resorts with modern facilities.Japans resorts,particularly in Hokkaido and Nagano,are famous for their high-quality powder snow,attracting international tourists,especially from Australia and across Asia.China is a rapidly growing player,investing heavily in ski infrastructure and fostering a domestic skiing culture,with resorts catering to all skill levels.ASI A PAC I FI CAccording to data released by the National Ski Areas Association(NSAA),the 2023-2024 winter season was the fifth busiest on record for ski resorts in the US with 60.4 million skier visits during the 2023-2024 ski season.Collectively,ski resorts in the US experienced slightly less snow overall,historically linked to lower annual visitor numbers by the NSAA.However,skiers still crowded into the resorts,contributing to a total number of visitors that would have been considered high,even pre-pandemic.N ORT H A M E R I CA5T H E S K I R E P O R T 2 0 2 4/2 55P R I M E R E S I D E N T I A L I N D E XThe Savills Ski Prime Price League compares a selection of top ski resorts globally to ascertain whichcommands the highest average asking price per square metre for prime residential property.Forthepurpose of this analysis,Savills defines prime as properties with prices above 750,000.n the face of heightened economic uncertainty,global prime residential property markets have proved remarkably resilient.The ski market is no exception to this.While price growth in ski markets has slowed from its record pace in the immediate wake of the pandemic,average prime residential ski property prices increased by 3.8%over the course of the past year.In many markets,there are supply and demand imbalances which are contributing to rising prices.While prices remain 2%lower than their 2022 highs,on average they remain 34ove 2021 levels and 36ove pre-pandemic prices.Buying prime residential property is a personal and deeply emotional decision for most and choosing to purchase a prime ski property is no exception.Thepurchase not only represents an attractive storeof capital but also a highly sentimental assetformany.0 1A S P E NAspen,made up of four unique ski areas:Aspen Mountain,Aspen Highlands,Buttermilk,and Snowmass,is more than just skiing;it is a year-round hotspot for outdoor enthusiasts and those seeking a luxurious getaway.The resort retains its top spot in the Prime Price League,with asking prices at nearly 40,000 per square metre.While many other markets across the United States have slowed due to high interest rates,prices in the Aspen market do not seem to have reached a ceiling,increasing by 9.3%from 2023 values.0 2 C O U R C H E V E L 18 5 0As the first purpose-built ski resort in France,Courchevel 1850 offers skiers access to the Three Valleys,luxurious hospitality,and prime residential property.The resort is the second-most expensive location in the Savills Prime Price League,with average asking prices of 34,600 per square metre.0 5S T M O R I T ZOf the nine Swiss ski resorts in the top 20 by pricing,StMoritz is one of the highest priced.The market consistently attracts global ultra-high-net-worth individuals(UHNWIs)for both its skiing and for its lifestyle offerings,attracting winter sports enthusiasts since the 19th century.Asking prices for prime residential property averages 26,600 per square metre,positioning the glamorous Swiss resort as the fifth-most expensive in the Savills Prime Price League.19C O R T I N A DA M P E Z Z OHosting the Winter Olympics in 2026 jointly with Milan,CortinadAmpezzo has been on the radar of skiers across theworld in recent years.This increased attention is playing outin its prime residential markets,where average asking prices have increased by 0.03%year on year to 14,800 per square metre.Global attention will likely only continue to support pricing and price growth in the coming years.03 VA L D I S R EVal dIsre sees the second-highest prime residential prices in France,and third in our index,with average asking prices at nearly 30,000 per square metre.The market consistently ranks as one of the most desirable in the Alps for both prime residential property and for its skiing amenities with numbers of ski runs and challenging slopes.Thisever-popular,high-altitude resort consistently ranks in the top10 of the Savills Ski Resilience Index(seepages 10&11).I6T H E S K I R E P O R T 2 0 2 4/2 5P R I M ECanada&USAFranceSwitzerlandAustriaItalyAVERAGE P RI ME ASKING PRICE PER SQUARE M ETRE()T O P 2 0S K I R E S O R T SSource:Savills ResearchNote:Based on properties with asking prices greater than 750,000 with exchange rate as of August 2024.Courchevel includes Le Praz,1550&165039,50034,60029,20027,20026,60023,70022,60021,40021,40020,20019,50018,80018,60017,60015,50015,30015,10015,00014,80014,700Courchevel 1850Val dIsreVerbierSt.MoritzGstaadAndermattDavosKlostersGrindelwaldTignesCortina DAmpezzoMegveAspenLechKitzbhelZermattFlims(Laax)MribelCourchevelVail7T H E S K I R E P O R T 2 0 2 4/2 5U LT R A-P R I M E P R I C I N GSource:Savills Research.Note:Based on each markets top available prices and number of current listings per markethe top ten locations with the highest ultra-prime prices are largely unchanged from 2023,though there has been some jostling for places among the resorts.Aspen remains the top location for ultra-prime pricing,with average prices at nearly 85,000 per square metre.The market has been booming in recent years as domestic and global ultra-high-net-worth individuals choose the Colorado resort as their winter base.Swiss resorts account for nearly half of the top 10 resorts,with the highest ultra-prime pricing.Verbier is the highest-ranked Swiss ski resort by Tultra-prime pricing,with an average asking price per square metre of 45,000;however,in resorts such as Gstaad and other locations across Switzerland,the most desirable properties can transact without ever coming to market.These off-market transactions can see pricing from 40,000 per square metre to over 75,000 per square metre,well abovethe listed prices for ultra-prime properties.French ski resorts comprise more than a third of the Ultra-Prime Price League,with Val dIsre and Courchevel 1850 seeing the highest ultra-prime prices.In both resorts,average asking prices per square metre for the highest-end properties often exceed 40,000/m2.Vail,which claimed second place in the ultra-prime rankings in 2023,has fallen to fourth place in this years update with an average ultra-prime asking price of 43,000 per square metre.High interest rates for the standard 30-year fixed-rate mortgage in the US have brought the overall housing market to a crawl,even at the less mortgage-reliant prime and ultra-prime residential markets.The true summit of prime residential ski marketsCanada&USAFranceSwitzerlandAustriaTop 10 ultra-prime ski resorts,by ultra-prime price per square metreVAL DISRE42,100COURCHEVEL 185047,200VERBIER44,900VAIL43,200ASPEN84,500GSTAAD38,000ST.MORITZ37,600MRIBEL36,300KITZBHEL35,600ANDERMATT31,1008T H E S K I R E P O R T 2 0 2 4/2 5M A R K E T O U T L O O KClear runs aheade have compared the prime residential property market outlook for ten key Alpine resorts over the coming year,using four key indicators.Resilience to climate change,openness to international buyers,and volume of supply in each location all factor into the analysis.Proximity to transport is also considered,but to a lesser extent.Chamonix offers the second strongest outlook for any of the ten markets Wcovered;with low levels of supply,an openness to foreign buyers,relatively low average prime asking prices,and a high resilience rank.This French resort,at the base of Mont Blanc and on the crossroads between France,Switzerland and Italy,is one to watch in the coming years.Swiss locations account for nearly half of the locations in our outlook this year;and the country continues its reputation as a byword for safe haven amongst the global wealthy.Demand outstrips supply in most of the resorts covered,apart from Villars which local agents report has balanced supply and demand dynamics.Foreign buyers should be aware of buyer restrictions inthe country which vary from canton to canton,and which can have a micro effect onproperty markets,depending on the location.Ski market outlookSource:Savills Research*NB Only new or newly built property in Andermatt is exempt from foreign buyer restrictionsVILLARSMORZINECOURCHEVEL 1850VAL DISREANDERMATTZELL AM SEEGSTAADVERBIERCHAMONIXASPENP R I M E P R I C E S 2 0 2 4 (P S M)R E S I L I E N C E R A N KL E V E L O F S U P P LYO P E N N E S S T O I N T E R N A T I O N A L B U Y E R SM A R K E T O U T L O O K11,0009,30034,60029,20022,60010,30027,20013,40039,500485519623381716423,70027Completely open(foreign buyers and domestic buyers are not viewed differently)*Open but with a high level of restrictions on foreign buyers9T H E S K I R E P O R T 2 0 2 4/2 5S K I R E S I L I E N C E I N D E XBreuil-CerviniaVailVal ThorensAspenZermattVal dIsreValle NevadoSt.MoritzSaas FeeTignesSldenObertauernObergurglIschglDavosChamonixVerbierLechCourchevelGeiloGrimentzFuranoAndermattWhistler BlackcombLa PlagneNendazGstaadLa RosireCrans-MontanaMribelCortina DAmpezzoSt AntonSnowfall ReliabilityAltitudeSeason lengthTemperatureSnowfall051015202530354045Index scoreInconsistent snowfall and the whims of the weather have been a challengefor the industry since the advent of alpine sport.n the face of continued global warming and changing climates,this challenge,among others such as shorter overall season lengths,will continue to persist.The 2023-2024 season saw significant variation in snowfall,as well as season length across our surveyed resorts.These factors have resulted in some reshuffling in our rankings.Breuil-Cervinia in Italy climbed four positions to take the top spot in our index,boosted significantly by a longer season and improved snowfall reliability than last year.The French resort of Val Thorens also saw one of the largest increases across the index of ten places.It has taken third Ioverall in our rankings,with the market enjoying a long ski season and significant annual snowfall.Zermatt,consistently at the top of the rankings,has fallen this year to fifth place.This Swiss resort is located at the base of the large Matterhorn Glacier,which has traditionally afforded it one of the longest winter seasons and reliable snowfall.As several lower-ranked resorts saw gains,Zermatt has fallen in rankings despite conditions being consistent with last season.Other large changes in our index include the two Japanese resorts of Niseko and Furano.Both saw falls in their resilience rankings,with Niseko declining by twelve places.The previous season,these Japanese resorts saw record-breaking snowfall,so while they may have fallen in the rankings,this represents a return totrend.Markets across the Americas almost universally saw declines in rankings,with the exception of Vail which remained in second place.The El Nio weather pattern caused below-average snowfall and warmer temperatures in North America.This weather event influenced the Canadian resorts of Whistler Blackcomb and MontTremblant,which fell in the rankings by ten andeleven places,respectively.Savills Ski Resilience IndexSource:Savills Research10T H E S K I R E P O R T 2 0 2 4/2 5reGrindelwaldVemdalenHemsedalNisekoZell am SeeMont TremblantFlaineTrysilBad GasteinAvoriazKitzbhelVal Gardena-GrdenMegveSaalbachVillarsKvitfjellFlims(Laax)PinzoloLa ClusazMayrhofenLas LeasMorzineEllmauGarmisch-ClassicMount HothamMorginsSeefeld(Rosshtte)Seefeld(Gschwandtkopf)GlensheeGlencoeChampryIn France,resorts have seen a comparatively high variation in rankings year on year,compared to other countries.At one end of the spectrum,Val Thorens climbed into the top three,while Tignes jumped 17 places to tenth.Other markets,such as Flaine,have travelled in the opposite direction,falling by ten places.French resorts have historically seen larger variations in snowfall,so these changes are not out of the ordinary.Altitude is a significant contributing factor.Higher altitude resorts tend to have longer seasons and better reliability than resorts situated at lower elevations.It is no surprise then that the top five markets in our index all sit at the high end of the altitude scale,and resorts that saw declines,such as those in Canada and Japan,are among the lowest altitude destinations.As circumstances continue to change,it follows that high mountain resorts will likely remain the most resilient destinations for winter sport.The possible exception to this is Norway,which benefits from a northerly latitude compared to more traditional European resorts.New entrant Geilo,to the north west of Oslo,features 20th in our index.Higher altitude resorts tend to have longer seasons and better reliability than resorts situated at lower elevations.11T H E S K I R E P O R T 2 0 2 4/2 5Source:Savills ResearchNote:Aprs-ski environment:Ski pass price,Number of spas,restaurants,nightclubs,and bars,Average price of an Aperol spritz,and Average price of a hot chocolate.SkiStay:Average price of prime apartment rental(1 week),Average price of a chalet(1 week),and number of 4*and 5*hotelshile mastering a mogul field on a challenging red or black run is critical to the skiing experience,aprs-ski is where the resorts come to life,and when skiers can relax after a long day on the slopes.Luxury winter sport deserves an equally luxurious counterpart,where the chill of the snow is replaced by toasty fires,and the hot chocolate makes room for Aperol spritz.WJust as important to skiing culture as the skiing itself,aprs-ski encompasses everything from restaurants,tobars and nightclubs,to spas,and wellness.For the inaugural Savills Aprs-Ski Index,that is just what we considered.From the cost of a day pass and a stay on theresort,to the provision of aprs-ski amenities,alloftheresorts offer the elements necessary for the perfect prime aprs-ski experience.Savills Aprs-Ski IndexVailIndex scoreZermattAspenVal Gardena-GrdenSt MoritzWhistler BlackcombFlims(Laax)IschglDavos-KlostersCourchevelSt AntonVillarsLechGstaadGrimentzMribelCrans-MontanaVal ThorensChamonixVal dIsreVerbierMegveMorzineKlostersBreuil-CerviniaAprs-ski environmentSki stay010203040506070A P R S-S K I I N D E X12T H E S K I R E P O R T 2 0 2 4/2 5When it comes to skiing in Colorado,its hard to top the states most famous ski destinations for skiing and the aprs-ski environment.With one lift ticket,visitors get access to mountains spread across the region.With some of the highest provisions of bars and restaurants,both Vail and Aspen resorts are well placed to welcome skiers and support their aprs-ski activities.Source:Savills ResearchNo aprs-ski evening would be complete without a beverage to satisfy the thirst worked up from spending a day on the slopes.For many,only an Aperol spritz or a hot chocolate will do the trick.Prices for these beverages are as varied as the locations themselves,however.Ultra-prime resorts in Switzerland and the US lead in terms of pricing for both a spritz and a hot chocolate,but value can be found at other resorts across the globe.Savills Aprs-Ski IndexEuropean resorts,deservedly,have a reputation for some of the best aprs-ski cultures in the world.Apart from the three North American resorts,the top 25 is entirely dominated by European locations.Originating the concept of aprs-ski,European resorts offer plentiful hospitality options on location,vast numbers of bars,restaurants,and nightclubs,and in many locations,the drinks of choice,hot chocolate and Aperol spritzes,remain relatively affordable.13.0012.2011.9614.3118.8513.8013.596.9511.026.50St.MoritzAspenZermattVailCourchevelMribelVal dIsreVerbierGstaadKitzbhel6.185.635.386.666.856.586.404.554.904.20 Gstaad St.MoritzZermatt Vail VerbierMribelCourchevelVal dIsreAspenKitzbhelAperol spritzHot Chocolate13T H E S K I R E P O R T 2 0 2 4/2 5O F F E R I N G SS U M M E R lpine resorts are constantly evolving.One does not need to look further than the growing number and variety of summer offerings that these destinations are embracing,as they move to being truly year-round visitordestinations.This trend is intrinsically linked to the increased uncertainty around season length and snowfall in the face of the changing climate.Providing a diverse set of summer activities and attractions can offset revenue lost in a shorter winter.Generally speaking,resorts with less resilient winter seasons or those that have the widest ranking swings in our resilience index,tend to offer the best range of summer activities.To better assess which resorts stand out for their summer offerings,we have split out activities and events into their own categories.Mountain biking and hiking are widely available at almost every resort and these are easily achievable activities requiring minimal investment.Providing a diversity of activities such as large public events to tailored spaces for golf,water sports,orziplining requires more capital investment but are ultimately likely to attract repeat summer visitors.A14T H E S K I R E P O R T 2 0 2 4/2 5Source:Savills ResearchF R AN C EFrance,with many lower altitude resorts which see more variable conditions every year,has some of the largest investment and offerings of summer activities.Megve is a prime example.The resort fell by five places in our resilience index this year,but offers a very wide range of activities with gastronomic festivals,equestrian events,as well as popular concerts throughout the summer months.J A PA NJapanese resorts are especially attractive to international travellers.Japan comes in second place partly due to the inclusion of many more tourist-oriented cultural activities.For example,the Hirafu festival is held in Niseko during the summer,where traditional sword fighting tournaments combine with gourmet dining opportunities at the foot of the Niseko Annupuri mountain.Average number of summer attractions by resortP O T E N T I A L B U Y E R SFor potential buyers,it is important to keep summer offerings in mind.Even if the property is not intended to be in use during the off-season,owners may wish to rent out the space on a short-term basis.In areas with a stronger presence of summer offerings,it may be easier to find interested visitors which may enhance the ability to earn more passive income.Hiking&bikingOther outdoor pursuitsSporting eventsMusic&community events012345687SWITZERLANDAUSTRIAITALYUSAJAPANFRANCEAverage count of activities15T H E S K I R E P O R T 2 0 2 4/2 5Source:Savills Research using skiresorts.info2020/2021212021/2022252022/2023272023/2024322024/202535Planned108I N F R A S T R U C T U R E I N V E S T M E N Tor the top ski resorts globally,consistent investmentin their core infrastructure is crucial to allowing visitors to get the most out of the mountain.These investments can extend the lifespan of resort amenities and create new experiences for new and regular guests alike.This can take the form of upgrading existing amenities and building new attractions to enhance alpine lifestyle offerings.FLifts are critical infrastructure for any mountain resort,one that both enables and symbolises the high-altitude opportunities at any alpine destination.As such,constant investment in improvements and development of new lifts is crucial to expanding the variety of pistes and experiences available.Since the pandemic,each subsequent season has seen an increase in the deliveries of new lifts in our tracked resorts,starting at 21 in the 2020-2021 season to 35 planned and recently completed lifts for the 2024-2025 season.Number of new lifts globally,completed and planned16T H E S K I R E P O R T 2 0 2 4/2 5France leads in this metric,with almost four completed lifts per resort over that period.Italy comes in first for planned lifts,with three planned per resort as the 2026 Winter Olympics will be hosted in Cortina DAmpezzo,presenting the perfect opportunity to expand the regions infrastructure.The global ski industry is becoming increasingly intertwined across borders and resorts,a key example of this being the recent investments of Vail Resorts(based in Colorado)in the Swiss resorts of Andermatt and Crans-Montana.These investments not only aim to improve the infrastructure and offerings of these resorts,but also extend the companys Epic Pass programme to Europe,which may incentivise more international tourism to thesedestinations.For individual resorts,there are opportunities to collaborate on infrastructure where it makes sense.An example of this is the Matterhorn Alpine Crossing,which recently opened and represents the highest border crossing in the Alps that directly connects the Zermatt and Breuil-Cervinia resorts in Switzerland and Italy,respectively.It makes several stops between its destinations where visitors can take part in a variety of activities such as viewing platforms and Europes highest museum.This infrastructure elevates these resorts with new experiences butalso benefits both resorts with increased foot traffic from their respective neighbour.The need for climate resilience provides more opportunities for infrastructure investment.Many top ski destinations are investing in making their operations more environmentally friendly.These investments can include energy efficiency measures such as installing solar panels on the roofs of lifts and structures and purchasing energy-optimised and efficient snow machines to extend the ski season sustainably and responsibly.Upgrading and maintenance of high-quality insulation can also reduce the amount of energy needed to heat indoor spaces and reduce costs.In the face of a changing climate,ski resorts are increasingly expected to be environmentally conscious.Investing in these measures can not only improve public perception,but also improve the guest experience and running of the resort.This continued growth in lifts underscores broader confidence in the industry.Austria,France,Italy,and Switzerland all saw significant lift per resort deliveries between 2020 and 2024.17T H E S K I R E P O R T 2 0 2 4/2 5S AV I L L S S K I E X P E R T I S Eavills has been selling property in the Alps for more than 20 years.One of our first projects was the commercialisation of Arc 1950 in the French Alps,on behalf of Canadian resort developer Intrawest.Building upon the success of this unique village,Savills has since helped numerous developers and private clients to dispose of or acquire ski property assets.We are able to draw on the expertise of a comprehensive network of best-in-class associates across the Alps,to provide buyers,sellers,developers and investors with the advice they need.Operating from branded Savills offices in Verbier,Courchevel 1850 and 1650,Mribel,Annecy and Zell am See,and with associate agents and partners in Morzine,Chamonix,Kitzbhel,St Moritz,Gstaad,Villars,and Saas-Fee,we provide valuation,development consultancy,sales and marketing,and rental services in these and other prime ski resorts.F RENCH AL PSOur flagship office is at the heart of Courchevel 1850,Frances premier Alpine resort.Focusing on prime and ultra-prime resales,new developments and rentals,this office was complemented in 2021 by a new office in 1650,also servicing La Tania and Le Praz.Additionally,the Savills Mribel office provides brokerage services in this prime resort.In 2018,Morzine Immo joined Savills as an international associate.Established more than 30 years ago,Morzine Immo provides market-leading sales and rental services for private clients and developers in Morzine.Since 2020,Savills also has a dedicated bureau in Annecy covering other prime French resorts such as ValdIsre and Megve,as well as Lake Annecy itself.SSWISS A L PSHarnessing 19 years experience of selling property in the Four Valleys,Savills has a dedicated sales and rentals office in Verbier,directly on Place Centrale.We are delighted to have acquired established rental and management business Verbier Location in January 2024,complementing our agency business and expanding our service line offering to clients.In addition to the other Four Valleys resorts(Nendaz,La Tzoumaz,Veysonnaz and Les Collons),Savills also provides buying and selling services in Saas-Fee,Grimentz,the Gstaad Valley and Morgins,and bespoke property services in other prime Swiss resorts such as Zermatt,St Moritz and Andermatt.Since 2023,we are delighted to welcome Grance Service in Villars as an associate of Savills Global Residential Network.AU STRI A N A L PSSavills was one of the first international property consultants to enter this market.Since 2005,we have assisted hundreds of buyers to acquire and sell second homes in the region.From our dedicated office in Zell am See,and through partners in Kitzbhel and Lech,we cover the majority of ski resorts in the Tyrol and Salzburgerland.I TA L I A N A L PSFrequently overlooked,the Italian Alps and Dolomites are stunning landscapes and include famous resorts such as Cortina,Cervinia,Courmayeur,Champoluc and Madonna di Campiglio.Often better value than some of their European cousins,they combine worldclass skiing with dual-seasonality.N ORWAY Norway may be lesser-known to many skiers,but it offers exceptional advantages:more reliable snow conditions than many Alpine resorts,stunning natural landscapes,and a growing number of foreign buyers.Weare excited to announce our collaborations in premier ski destinations such as Kvitfjell,Geilo,and Oppdal.RES EA RC HUsing our extensive knowledge and first-hand experience of sales and market intelligence,we were the first international property company to publish an annual ski report.Tracking sales data and market trends,and including the unique Savills Ski Resilience Index,the report has evolvedinto an invaluable resource forbuyers,sellers and investors alike.OTH ER S ERV I C ESSavills Ski works closely with a variety of disciplines across Savills that also do business in the Alps.These include valuation services(for bank,matrimonial or fiscal purposes),Savills Hotels,European Cross Border Division,Savills Global Residential and SPF Private Clients(aspecialist inoverseas mortgages).Unequalled experience,knowledge and contacts18T H E S K I R E P O R T 2 0 2 4/2 5C O N TA C T SSAVILLS WOR LD R ES EA RC HWe monitor global real estate markets and the forces that shape them.Working with our team across the globe and drawing on market intelligence and published data,we produce a range of 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The Circular Built Environment in Canada:A Strategic Framework for Future ActionSTANDARDS RESEARCHMarch 2024THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION2csagroup.orgAuthorsTima Bansal,Ph.D.,Innovation North,Ivey Business SchoolElizabeth Miller,D.Sc.,Innovation North,Ivey Business SchoolCarly MacArthur,M.A.,Innovation North,Ivey Business SchoolResearch Advisory PanelLeila Ahmadi,M.A.Sc,National Research Council Canada(NRC)Jennifer Hancock,BA,BEd,LEED AP BD C,Chandos ConstructionJean-Martin Lessard,CEP,Ph.D.,Natural Resources Canada(NRCan)Annie Levasseur,Eng.,Ph.D.,cole de technologie suprieure(TS)Paul Shorthouse,Circular Economy Leadership Canada(CELC)Brenda Martens,O.B.C.,B.Sc.,CSBA,LEED Fellow,dify consultingKathy Wardle,MES,LEED Fellow,LFA,WELL AP,RELi AP,Perkins Will Canada Architects Co.Ivica Karas,M.A.Sc.,CSA GroupFiona Manning,Ph.D.,CSA GroupGrace Lee,P.Eng.,CSA Group(Project Manager)AcknowledgementsThe authors would like to thank the many people who supported this endeavour by agreeing to an interview or participating in the workshop.We were overwhelmed by the support for a circular built environment,which is testimony that the time for a circular built environment has indeed come.DisclaimerThis work has been produced by the author and is owned by the Canadian Standards Association.It is designed to provide general information in regard to the subject matter covered.The views expressed in this publication are those of the author and interviewees.The author and Canadian Standards Association are not responsible for any loss or damage which might occur as a result of your reliance or use of the content in this publication.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION3csagroup.orgForeword This report was completed by Innovation Northan initiative of the Ivey Business School,Western University.This work is the second phase of a three-phase project to build a strategic framework for a circular built environment in Canada,an initiative co-led by Circular Economy Leadership Canada(CELC)and CSA Group.The first phase is summarized in a report completed by Helen Goodland and Kelly Walsh of SCIUS Advisory,The circular built environment in Canada:A review of the current state,gaps and opportunities 1.An intended third phase will identify specific next steps toward a circular built environment(CBE),based on the strategic framework developed in this report.Innovation North is a research-practice collaborative at the Ivey Business School that tackles complex business issues.It is guided by a methodology,which we call the Compass,that applies systems thinking to innovation.A systems approach recognizes that many business and societal problems are complex and present differently to many groups,introducing significant barriers to change.Therefore,changes to these systems require coordinated actions that can nudge the systems forward.As systems are dynamic in nature,this report is not a definitive guide to a CBE,but rather a reflection of the actions that can enable a built environment today.The terms of reference for this report included building a strategic framework as a significant step toward developing an action plan.Our aim was not to specifically define who carries out what action,but to provide a set of actions that can mobilize a CBE.We generated our insights using three important information sources:1.desktop research,including the report developed by SCIUS Advisory in Phase 1 of the project;2.twenty-five one-hour interviews with 30 key informants;and3.three virtual workshops and one in-person workshop,involving 60 people in total.We also received detailed feedback from CSA Group throughout the process and the Project Advisory Panel on report drafts.Although we sought to include a broad range of voices,we recognize the many important omissions,including the voices of Indigenous peoples.These voices are important to ensure that we see all parts of the system and not just those seen by the most influential or mainstream actors.We sincerely hope that if the same research is conducted three years from now,we would be able to write a different report because CBE would be further advanced.The AuthorsDr.Tima Bansal,tbansalivey.caDr.Elizabeth Miller,emillerivey.caCarly MacArthur,cmacarthurivey.caTHE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION4csagroup.orgTable of ContentsExecutive Summary 61 Introduction 72 The North Star 82.1 Defining a Circular Built Environment 92.2 The Elements of a Circular Built Environment 92.2.1 Adaptive Reuse of Existing Buildings 92.2.2 Adaptive Design of New Buildings 92.2.3 Material Reuse 102.2.4 Relationships Among the Three Elements of a Circular Built Environment 103 Problems Addressed by a Circular Built Environment 113.1 Future-Proofing Buildings 113.2 Future-Proofing Construction 113.3 Lower Cost,More Affordable Buildings 113.4 Ecological Sustainability 114 The Barriers to Advancing a Circular Built Environment 124.1 Lack of Awareness About Circularity and its Implications 124.2 Design of Existing Buildings 124.3 Construction Products and Techniques that Hamper Reuse 124.4 Lack of Knowledge and Certification for Material Reuse 124.5 Relative Pricing of New Versus Reclaimed Construction Materials 134.6 A Culture of Always Building New 135 Actors that Can Advance the Circular Built Environment 135.1 Central Actors 145.1.1 Owners/Developers 145.2 Direct Actors 155.2.1 Architects/Engineers 155.2.2 Deconstruction and Salvage Companies 155.3 Enabling Actors 165.3.1 Material Manufacturers 16THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION5csagroup.org5.3.2 Investors 165.3.3 Governments 175.3.4 Standards Development Organizations 185.3.5 Industry Associations 185.3.6 Circular Built Environment Non-governmental Organizations 185.3.7 Higher Education and Research Institutions 196 A Strategic Framework 206.1 Preconditions:Removing Frictions 216.1.1 Building Awareness 216.1.2 Building Physical Viability 246.1.3 Building Financial Viability 246.1.4 Building Coalitions 266.2 Project Activities:Moving Forward 276.3 Communicating and Celebrating Wins:Amplifying Actions 296.3.1 The Value of Project Success Stories 296.3.2 General Principles 296.3.3 Collecting and Disseminating Success Stories 306.3.4 How Might Pilot Case Studies Be Used?307 Mobilizing Action in the Future 307.1 Ongoing Engagement and Emergence 307.2 Actors to Target 327.3 Prioritizing Actions 327.4 Future Research and Exploration 338 References 349 Appendices 379.1 Data Sources and Report Writing 37Desktop Research 37Interviews 37Workshops 379.2 The Compass 37THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION6csagroup.orgExecutive SummaryThe objective of this report is to develop a strategic framework for a circular built environment(CBE)in Canada that is ready to feed into a detailed strategic framework.We focus on buildings that typically exceed 600 square metres or three stories in height and exclude smaller buildings,such as single-family dwellings.Although a CBE can include any material,we focused particularly on wood,concrete,and steel for this report.We did not include material efficiency on-site or smaller renovations.Additionally,our focus was on material use and reuse,and therefore energy efficiency was beyond the scope of this report.In this document,we outline how organizations can help mobilize a CBE through the adaptive reuse of existing buildings,the adaptive design of new buildings,and the reuse of materials.The circular economy is inherently a systems problem because it involves so many actors with interdependent activities.To enable a CBE,it is important to involve not only those actors that contribute directly to a built environment,such as owners,developers,and builders,but also those that can enable change,such as standards organizations,architects/engineers,and the government.This report also outlines the first moves and second moves.The first moves will lift barriers,take small actions,and celebrate wins.Second moves will widen the circle to build upon those first actions and invite more actors.Overall,the following actions will greatly support the move toward a CBE:1.Define CBE concepts using standards2.Develop educational resources for central and direct actors(i.e.,introductions to the concepts and benefits;how to ask for circularity in a request for proposal RFP for a developers new project)3.Build coalitions,starting with front-runner organizations and adding fast followers4.Research how to build physical viability(e.g.,options for disassemblable connections or the safe reuse of wood in structural applications)and financial viability(e.g.,markets for reclaimed materials)and develop recommendations for viable solutions5.Connect current municipal policy goals and projects with opportunities to incorporate circularity practicesTHE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION7csagroup.org“A circular built environment(CBE)involves three core elements:the adaptive reuse of existing buildings,the adaptive design of new buildings,and the reuse of materials.”1 IntroductionThe construction industry contributes approximately$141 billion to the Canadian economy annually 2.Shifting the Canadian construction industry from a linear take-make-waste economy to one that is circular would affect the Canadian economy,influence how Canadians live,and impact the natural environment.A circular built environment(CBE)involves three core elements:the adaptive reuse of existing buildings,the adaptive design of new buildings,and the reuse of materials.These elements will help to future-proof the built environment,as they can adapt to changes in business and user needs;create more affordable,low-cost infrastructure when materials stay in use longer;and contribute to a more resilient and sustainable natural environment by keeping materials out of landfills and extracting fewer resources.These benefits highlight many reasons for a CBE;however,it has been difficult to mobilize because the linear model upon which the built environment has evolved is deeply embedded in industry supply chains,construction techniques,and mindsets.The current approach to the built environment evolved at a time when natural resources were cheap,landfill space was plentiful,and stressors on the natural environment were almost invisible.As such,changing general business practices to create a CBE is extremely challenging.To shift the construction industry,one needs to appreciate the range of actors involved in the system.The most central of these actors are owners and developers,who at times are the same and ultimately make building decisions.However,other actors also directly influence these systems,including architects and engineers,material/product manufacturers and suppliers,and deconstruction/material management companies.Further,various actors can enable change for these direct actors,such as planners,investors,governments,standards development organizations(SDOs),non-government organizations(NGOs),and insurance companies.It is important for each of these actors to recognize their role in the system and the possible benefits they might offer and gain as part of a CBE.Motivating change in the construction industry goes beyond giving people reasons to change.They need to see tangible opportunities and benefits,particularly due to significant risks and costs associated with building projects.Re-evaluating the system requires stepwise,iterative change,which can be characterized by three key stages throughout this report.In the first stage,actors seek to reduce the barriers to change.In the second stage,owners/developers and architects design and build pilot projects.In the third stage,these pilot THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION8csagroup.orgprojects(often called small wins)are celebrated and communicated widely.These stages are repeated,building on the previous stages and widening the circle of actors involved.Overall,this process will ensure that the CBE builds incrementally on past successes,ultimately leading to the emergence of a CBE.Figure 3 illustrates our theory of change.At the beginning,front-runners work to lift barriers and establish the preconditions(Phase I)for circular building projects(Phase II),followed by celebrating wins and communicating learnings from CBE projects(Phase III).This process is then repeated,widening the circle to include fast followers the second time around,ultimately moving toward widening the circle to include mainstream actors.Beyond offering a strategic framework,this project identified an important insight:the circularity movement is being driven by a small group of highly motivated and knowledgeable actors.Although there are many actors in the construction industry who care about elements of the CBE,they are not part of the immediate CBE community because they do not know,understand,or use the term“circularity”in their day-to-day work.We recommend a more meaningful term be used to describe circular elements in constructionone that resonates with a wider circle of industry actors,such as“future-proofing,”which is already used in industry discussions that reference adaptable buildings.This report expands upon the first phase of this project developed by SCIUS Advisory 1 using additional desktop research;25 interviews with 30 key informants of the built environment in Canada;three virtual workshops that centred on wood,concrete,and steel;and an in-person workshop with industry leaders.In the next sections,we describe how to mobilize a CBE.We deploy a systems design methodology,which we call the Compass,described in detail in Section 9.We start with describing the destination or North Star,followed by describing the Problem,building Awareness through a systems map,describing the Ideas that can address the Problem,and finally,enumerating Actions that will mobilize a CBE.2 The North StarAt Innovation North,we use the North Star to describe the overarching goal and purpose of an initiative.It points to a desirable future,giving the innovation agenda both a destination(where and why)and a direction(how).Based on our conversations with industry members,our North Star guiding the CBE can be described as follows:Imagine.if all developers and owners built commercial,large residential,and institutional buildings that used materials from regenerative sources,produced resilient buildings,avoided waste(including carbon throughout the value chain)and redirected all unavoidable waste back into the value chain.The actions outlined in this report aim to move us toward this North Star to bring about lasting systems change.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION9csagroup.org2.1 Defining a Circular Built EnvironmentCircular Economy Leadership Canadas(CELC)vision for a circular economy is an economic system that“advances a net-zero,nature-positive Canada,supporting economic prosperity through innovation and the well-being of Canadians today and for future generations”3,4.A CBE seeks to redress the excess resource extraction and waste created by a linear industrial economy in which buildings are constructed,renovated,restored,or removed.In a CBE,materials come from regenerative sources(i.e.,sources that continue to produce,such as wood)when possible,are kept in use longer in their highest-value possible use,and returned to the economy once they are no longer needed in their current form.A CBE affects every stage of the building life cyclefrom design,to construction,to use,to deconstruction.2.2 The Elements of a Circular Built EnvironmentAfter reviewing much of the prior research in this space,we identified three elements critical for a CBE:adaptive reuse of existing buildings,adaptive design of new buildings,and material reuse.In this section,we describe these outcomes and the relationships among them.2.2.1 Adaptive Reuse of Existing BuildingsTo achieve national environmental and carbon emissions goals,a priority activity for the built environment is the reuse of existing buildings 4,5.As community needs change over time,the types of buildings needed within a community often change,too.Reusing existing buildings allows for opportunities to transform them into something different from their original design and purpose,offering new life and functionality.An example of this adaptive reuse of buildings is converting a vacant office space into multi-residential units.This practice ultimately extends buildings overall lifespan,preserving the embodied carbon 1 within,avoiding carbon emissions associated with new builds,and may even bring additional socio-cultural benefits to a community by preserving its heritage.Adaptive reuse projects were identified by our interview and workshop informants as one of the critical avenues for advancing sustainability in the built environment.Since most of the 2050 built environment has already been built,adaptive reuse will be a central strategy going forward 6.Adaptive design concept definitionsAdaptability a characteristic of a products design that enables the product to be modified,relocated,or adapted during its useful life to accommodate a new or adapted use.Disassembly a characteristic of a products design that enables the product to be taken apart at the end of its useful life in a way that allows components and parts to be reused,recycled,recovered for energy,or used for other environmental purposes 7.Note:This characteristic can be applied to a product,system,component,or assembly.Disassembly/adaptability a characteristic that merges the concepts of design for disassembly and design for adaptability in a way that enables a product to be adaptable for modification during its useful life with the components and parts 8.2.2.2 Adaptive Design of New BuildingsAdaptive design is an umbrella term that describes various design strategies that permit buildings to be reconfigured during the buildings use life and for material recovery at the end of the use life.These strategies include design for disassembly,design for adaptability,and design for deconstruction.Adaptive design anticipates and facilitates opportunities to change the buildings physical infrastructure,use,or purpose in the future,acknowledging that the needs of a built environment change over time.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION10csagroup.orgFigure 1:The three key elements of a CBE.Graphics from Flaticon:DinosoftLabs(office building),Smashicons(demolition),Uniconlabs(landfill,steel),Pause08(hook),and Freepik(construction)Waste to LandfillBuilding DemolitionUse of existing buildingBuilding reuseMaterial salvage at end of lifeMaterial reuse in other buildingsEasier material salvage at end of lifeEasier building reuseAdaptive design of new buildingsCurrent status quoCircular built environment2.2.3 Material ReuseWhereas reusing existing buildings and designing adaptive structures tend to focus on the infrastructure,material reuse ensures that component materials continue circulating long after they are removed from buildings.The reuse of structural materials,such as wood,concrete,and steel,in building applications is particularly impactful in reducing the embodied carbon of the built environment.This approach is the most challenging to address because building design often stipulates the type,quality,and standards of materials used.Additionally,many materials,especially when reused,must undergo rigorous testing to comply with relevant applicable standards and codes(e.g.,CSA 086:19 9 and NLGA 10 grading currently allow for the remanufacturing,regrading,and reuse of wood in very limited applications;CSA A23.1:19 11 currently allows for recycled concrete aggregate for low-strength applications).In many instances,insufficient data are available about specific materials and standards that help to mitigate risks.Consequently,our informants reported that while adaptive reuse and adaptive design strategies could be implemented at the project level now,material reuse needs more preparatory work to be widely implemented.2.2.4 Relationships Among the Three Elements of a Circular Built Environment Figure 1 illustrates the relationships among the three elements of a CBE and how they reinforce one another and disrupt the typical progression of demolishing existing buildings and landfilling their materials.A CBE paradigm would transition salvaged materials at the end of their life cycle.Simultaneously,new builds in the CBE paradigm use adaptive design strategies to simplify adaptive reuse and disassembly for material recovery.Design for adaptability makes it easier to repurpose and reuse buildings in the future,as the physical structures can be more easily updated.Similarly,designing for disassembly and deconstruction would help enable the salvaging of building materials for reuse since these design strategies allow materials to be removed intact(instead of conventional demolition).Salvaged materials that are recovered from existing and future buildings can be used for future building projectsideally,ones that continue utilizing adaptive design or building reuse principles.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION11csagroup.org3 Problems Addressed by a Circular Built EnvironmentCircularity is often met with resistance due to the complexity of its implementation,therefore it is important to outline the benefits for moving to a CBE.In this section,we highlight the benefits of circularity specific to industry actors,including future-proofing,affordability,and ecological sustainability.Ultimately,circularity is a catalyst for benefits that can be enjoyed by individual industry actors across the entire system.In this section,we outline the benefits that will be pertinent to a wide range of actors,focusing primarily on owners and developers who are critical to developing a CBE.3.1 Future-Proofing BuildingsCircular strategies can mitigate market volatility in the built environment by future-proofing buildings.New circular buildings are built with adaptation in mind,so they can be transformed for multiple uses as the needs of users change,such as the shift away from office work triggered by COVID-19.Circularity also invites innovative design that prioritizes longevity,rendering buildings more durable and resilient.3.2 Future-Proofing ConstructionNot only will buildings be better equipped to withstand volatility,but so will the entire construction process.The Canadian governments climate target of net-zero emissions by 2050 will shape public policies around construction,such as those around embodied carbon in the built environment 12.Corporations are following suit by committing to net-zero targets and seeking to occupy lower-impact buildings 13.Finally,circular strategies encourage the use of sustainable materials that bolster resilience to supply chain disruptions from economic volatility,climate change,and material shortages.At its current state of skill and supply,the reused materials market is subject to similar supply chain and labour volatilities as new materials.It is anticipated that as the reused materials market matures,the volatility will decrease beyond that of the new materials market since there will be significantly less reliance on virgin natural resources.3.3 Lower Cost,More Affordable BuildingsCircular housing can significantly lower costs for builders and increase the availability of affordable housing by focusing on modular,deconstructable buildings.Modular buildings can be cheaper than on-site-constructed buildings,construction times are shorter,design elements are standardized and repeatable,less material waste is produced,and the buildings are generally more flexible 15.Also,home relocation,which is outside the scope of this report,can increase affordable housing access through reused assets,especially in rural areas 16.3.4 Ecological SustainabilityGlobally,the construction industry consumes more raw materials than any other sector and accounts for an estimated 25 to 40%of the worlds carbon emissions.In Canada alone,this sector generates 4 million tonnes of waste per year 17,which disposes of product that has economic value and eliminates the productive use of land that must be dedicated to waste storage.Further,stripping the land of natural resources reduces biodiversity and contributes to carbon emissions during activities,such as extraction and production,called embodied carbon.As use-phase operational carbon emissions are lowered due to improved energy efficiency,embodied carbon is becoming a larger share of the built environments emissions.SaskatchewanBig Block Construction used modular construction to build affordable housing for Silver Sage Housing Corporations Home Fire complex 14.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION12csagroup.org4 The Barriers to Advancing a Circular Built EnvironmentFor all these benefits,the obvious question is why isnt the built environment more circular?There are several barriers to circularity,including those described below.4.1 Lack of Awareness About Circularity and its ImplicationsCircularity is not widely known among many industry actors in the built environment.Industry actors may also assume that circularity will add cost and time to a project.Whereas this might be true in some cases,a growing number of buildings constructed with circular design principles are cost effective,well-designed,adaptable,and resilient.4.2 Design of Existing BuildingsSeveral barriers to adaptive reuse can arise.Many structural drawings are lost,incomplete,or outdated.Even if the old drawings are available,it is likely that the building has gone through several smaller renovations over its life,altering the structure from the original drawings.This means many costs arise for inspections and to verify the existing structure and its current structural properties,leading to many unknown costs that may come up during the project(e.g.,expensive foundation rework).A loss of structural efficiency can also occur,as the structure was designed for a different layout/purpose of building;expensive foundation rework;and obstacles from key features that cannot change,such as ceiling heights.Older buildings are often not suited for repurposing and their materials may not be conducive to reuse.For example,high-rise commercial buildings lack sufficient exterior windows relative to their floor space,making it impractical to convert commercial spaces to residential.Some features may be unchangeable,such as ceiling heights.Sometimes,older buildings fail to meet modern safety standards,such as material strength or accessibility,or they may contain asbestos or mould that is expensive to safely remove.Similarly,adapting an existing building for a new purpose may pose challenges to integrating appropriate modern technology and prioritizing inclusive design.Land use and zoning laws can also prohibit the repurposing of old buildings for new uses.4.3 Construction Products and Techniques that Hamper ReuseContemporary“efficient”building techniques include the use of adhesives that hamper disassembly,adaptation,or deconstruction.Material manufacturers find it cheaper and faster to use adhesives,especially given the current low demand for reusing materials.Additionally,according to our interview and workshop participants,the construction industry deems it faster and cheaper to mechanically demolish a building rather than deconstruct the building and preserve its materials.4.4 Lack of Knowledge and Certification for Material ReuseThere are existing knowledge gaps regarding the safe reuse of building materials in building applications.For this reason,engineering design codes,such as CSA 086:19 9,generally do not allow for second-hand materials to be used in structural applications,as the wood industry does not currently have a process to grade used structural lumber for future structural applications.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION13csagroup.orgFigure 2:Main actors for mobilizing a CBEhigher educationindustryassociationsNGOsSDOsgovernmentinvestors and insurersmaterial manufacturersarchitects/engineersbuildersdeconstruction/demolition and salvage companiesowners/developersCENTRAL ACTORSDIRECT ACTORSENABLING ACTORS4.5 Relative Pricing of New Versus Reclaimed Construction MaterialsThe price of reclaimed materials and the labour required to extract them is higher than for new materials,because there is a shortage of supply for an already limited demand.Transportation and storage challenges exacerbate the costs and inconvenience of using reclaimed materials.Further,big box stores offer a“one-stop”shop to builders for new materials,whereas no reliable secondary markets exist for reclaimed materials.Vendors must visit multiple platforms and locations for limited(sometimes degraded)supplies,which only adds time and labour costs.4.6 A Culture of Always Building NewIndustry actors informed us that there is a strong bias among their peers and consumers for building new,rather than renewing old structures.In Canada,few twentieth century buildings were built with reuse in mind,so the quality of construction and materials used can be relatively poor.Additionally,architects and engineers often want to be recognized for their new,trendy,and original designs;urban centres are often focused on new construction projects;and tenants tend to prefer living in fresh,new buildings.Newer is often equated with better.The current fee structure further incentivizes new construction,as adaptive reuse and adaptive design require more upfront planning that can increase costs,which are difficult to include in a competitive tendering environment.5 Actors that Can Advance the Circular Built EnvironmentSince this research takes a distinctly systems-focused approach,many actors play an important role in a CBE.No single actor can advance the CBE alone.It can only happen through the collaboration and cooperation among actors who assume different roles within the system.Consequently,actors within a system exhibit differing levels of influence,involvement,and specialization.We identified three overarching tiers of actors:a central actor who has the most influence in a CBE,direct actors who play a supporting role,and enabling actors who can lift critical barriers to enable change.Actors can play different roles at different times,but our organizing framework recognizes the importance of their respective roles in actualizing a CBE.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION14csagroup.orgFigure 2 illustrates the key actors in a CBE,starting with the central actors that make key project decisions,direct actors involved in building projects,and enabling actors that lift barriers and establish the preconditions for action.5.1 Central ActorsIn our framework,the central actors are responsible for identifying the project,determining the scope of the project,deciding which actors/companies they will involve in the design and building process,outlining the budget,and ultimately,funding the project.5.1.1 Owners/DevelopersIn the built environment,the primary central actor is the owner/developer.Although owners are more inclined toward long-term impacts and developers may generally be focused on short-term gains from building sales,we grouped them together because owners and developers may be the same or the lines between these groups can be blurred.Owners/developers with long-term stakes may be more inclined to pursue circularity.Also,owners/developers set the conditions of satisfaction,which delineates the goals and values most important to the project.Role in activating the circular built environment As the primary decision makers that oversee and approve project plans,owners/developers play a key role in advancing circularity.If they choose to reuse an existing building,to design adaptively,or to utilize second-hand materials,they can influence direct actors in the system(i.e.,architects,engineers,builders)to execute these plans.Benefits to the actor Owners/developers can receive several benefits from incorporating circularity into their business plans.First,circularity contributes to future-proofing assets,making them adaptive to future market shifts and helping retain asset values.For owners,this future-proofing practice increases the likelihood of preserving the value of a given asset.For developers,this adaptivity may make the building more attractive on the market for owners looking for future-proof assets that can adapt with the times.By reusing existing spaces,owners/developers are often able to access prime downtown locations,preserve historic and cultural heritage,and may even be eligible for related municipal incentives 31.Additionally,circularity can reduce a buildings lifetime embodied carbon by prolonging materials use lives.Life cycle carbon requirements for buildings are expected in the 2030s,which aligns with the federal governments objective to support the development of new language for the 2030 National Model Codes that will enable the regulation of embodied greenhouse gas emissions 18.This would increase the benefits of employing circular design and building methods,thereby increasing the benefits of employing circular “By reusing existing spaces,owners/developers are often able to access prime downtown locations,preserve historic and cultural heritage,and may even be eligible for related municipal incentives.”THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION15csagroup.orgdesign and building methods.Moreover,circularity can help mitigate the risk of ending up with“stranded assets”that lose economic value(or even become liabilities rather than assets)as regulations and markets change,which is of increasing concern in the real estate sector.5.2 Direct ActorsDirect actors work primarily within the construction industry.They include engineers,architects,and builders.These actors have the industry experience and technical knowledge to influence design and building concepts and techniques.5.2.1 Architects/EngineersRole in activating the circular built environment Architects and engineers play a critical role in activating the CBE,as most decisions are made within the projects design stage.The actors that draw up the plans and define the technical specifications have a strong influence with mobilizing more circular ideas.Architects and engineers can advocate for adaptive design or the creative reuse of second-hand materials,particularly in projects that offer architects ample space for creativity,as opposed to those with very prescriptive,predefined specifications.To encourage circularity,architects and engineers need to demonstrate the benefits to developers(i.e.,increasing sales potential)and owners(i.e.,future-proofing the asset).If the owner/developer client does not want a fully adaptable design,the architect can identify cost-effective design and material elements that facilitate future adaptation,such as minimal necessary overdesign for accommodating higher future loads or adding footings under the floors for potential future walls.Since the various relationships that develop between owners/developers and architects/engineers greatly impact the projects they work on,architects/engineers can leverage this opportunity to advise their clients(i.e.,the owners/developers)on integrating circularity practices and bring forward new concepts and ideas,rather than exclusively relying on their client to identify these opportunities.Benefits to the actor For sustainability-minded architects and engineers,increasing opportunities for adaptive design will allow them to live their values in their work and influence change in the wider industry.Reusing existing buildings,designing adaptively,and determining how to use salvaged materials all present opportunities for architects and engineers to exercise creativity and innovation through unique,one-of-a-kind designs.Additionally,as life cycle reporting becomes increasingly common in Canadian jurisdictions and companies environmental,social and governance(ESG)requirements,architecture and engineering firms that establish themselves as experts in circular design may have a competitive advantage.5.2.2 Deconstruction and Salvage Companies Role in activating the circular built environmentDeconstruction and salvage companies play an important role in facilitating material reuse.They can carefully deconstruct buildings while keeping materials intact(instead of using conventional demolition techniques),separate and warehouse the materials,and sell the materials for future use.Demolition companies and their recycling partners work closely to find recycling pathways for building materials.Benefits to the actorA CBE is ideal for the sustained financial success of demolition and salvage companies.For demolition companies,incentives to find the highest and best uses for discarded building materials will generate demand for their services,which are more expensive Box#3QuebecRCO market in Montreal collects and sells reclaimed building materials 30.QuebecRCO market in Montreal collects and sells reclaimed building materials 19.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION16csagroup.orgthan conventional demolition.Deconstruction companies may face future competition from conventional demolition companies that begin offering deconstruction services.This occurred in Metro Vancouver communities following the introduction of construction waste diversion bylaws.In the nearer term,it may be easier for salvage companies to access reclaimed materials than to sell them for reuse.This is currently the case for one organization we interviewed that collects and sells used construction materials.A CBE will naturally drive up the inbound flow of materials,especially if there are incentives for diverting waste away from landfills.To increase the demand for reclaimed materials,incentives for using reclaimed materials in future buildings may be needed.5.3 Enabling Actors Enabling actors are those with roles that mobilize resources and tools that can lift some of the barriers or accelerate the transition to CBE.Actors in this group include(but are not limited to):manufacturers,investors,all levels of government and especially municipalities,SDOs,NGOs,educational institutions,industry associations,other research bodies(e.g.,think tanks),and consultants.5.3.1 Material ManufacturersRole in activating the circular built environment Material manufacturers play a critical role in activating adaptive design and,eventually,material reuse.The way in which parts of a building are connected determines whether they can be disassembled,and therefore material manufacturers need to offer disassemblable connector systems to unlock adaptive design.They can work with SDOs to ensure that disassemblable systems meet safety standards and will be accepted by provincial building codes.Similarly,advancements in technology can be explored for materials that are more suited for reuse.For example,steel is,as a material,generally easier to inspect to determine its structural condition.Therefore,in the current market state,it is more easily reused than concrete.There is also an opportunity for advancements in simplifying or improving the process to reclaim materials.Benefits to the actor The CBE will create a market for disassemblable connection systems.However,it is likely that material manufacturers will need incentives and certification support to bring disassemblable systems to market.Material manufacturers could benefit by offering disassemblable connections as products as a service or through other innovative leasing schemes,where manufacturers retain ownership of the product and can“sell”it multiple times.5.3.2 InvestorsRole in activating the circular built environment Investors provide and protect resources that finance the CBE.Investors can play an important role in removing financial barriers by offering more favourable terms for circular projects.Adaptive buildings,in particular,may be more likely to retain their value amid future market changes.For example,the Canada Mortgage and Housing Corporation could add circularity criteria to its mortgage loan insurance funding program,MLI Select,funding program,which currently offers more favourable mortgage insurance rates based on a projects level of affordability,energy efficiency,and/or accessibility.AlbertaThe City of Calgary offered incentives to convert 17 downtown commercial buildings into residential ones 20.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION17csagroup.orgBenefits to the actor Adopting favourable terms for circular building projects can align with investment firms ESG requirements for their investments.Investors may also attract more borrowers who are interested in prioritizing green construction projects over others.5.3.3 GovernmentsRole in activating the circular built environment Governmental bodies at all levels play a significant role in activating and advancing the CBE.For example,at the national level,the National Building Code of Canada may provide technical solutions by developing a national retrofit code and referencing relevant standards on reuse of existing buildings and materials,as well as adaptive design.Regulatory bodies at national and provincial levels have significant regulatory and financial powers in the transition to CBE.For example,they can activate the transition by offering grants for research and technology transfers,improving procurement policies which favour reuse and waste diversion,and providing financial incentives which incentivize market uptake.The role of municipalities is also particularly worth highlighting.Municipalities have the most influence when it comes to reusing existing buildings and materials,but they still have a role to play in adaptive design.They issue permits,conduct inspections,and hold zoning bylaws.Municipalities have jurisdiction over dictating what is possible for advancing the CBE from a legislative and logistical standpoint.For example,municipalities could waive development fees for and/or subsidize adaptive reuse projects.They could also relax requirements,such as those for parking,overshadowing,and service upgrades.It may be advantageous to position these as affordable housing and/or downtown revitalization initiatives.Further,municipalities can set zoning bylaws that more easily allow for existing building reuse(i.e.,switching from commercial to residential).Changing zoning specifications may also make adaptive design more appealing.Additionally,municipalities can play important roles in knowledge sharing and convening those with interest in this space.For example,in the City of Richmond,British Columbia,organizations contribute ideas,strategy,and pilot projects to help advance the citys circular built environment goals.Benefits to the actor Municipalities that support the CBE will contribute to their regional environmental targets.By keeping buildings in use longer,the municipality can build more affordable and flexible housing for residents.They can also reduce the safety risks and potential tax revenue losses that come from empty lots by keeping buildings from being torn down.Additionally,circular strategies can reduce construction waste,which takes up a great deal of space in landfills and contributes to municipal government costs.Municipalities may also build a positive reputation for innovation and forward-thinking practices.This perception may attract new residents and businesses to the region,thereby driving social and economic development.Governmental bodies at all levels play a significant role in activating and advancing the CBE.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION18csagroup.org5.3.4 Standards Development OrganizationsRole in activating the circular built environment SDOs can help de-risk transitions to circularity by setting technical standards that will maximize the safety of adaptable buildings and those that use reclaimed materials.For example,there is a CSA standard for adaptive design,CSA Z782-06,Guideline for Design for Disassembly and Adaptability in Buildings,which provides a framework for various actors to reduce waste generated by building construction materials 8.More can be done to increase the uptake of technical standards that support circularity practices.For instance,SDOs can further disseminate and educate industry members on the use and implementation of standards for circularity.This may include offering boilerplate language for owners to use for adaptive design in requests for proposals or working with material manufacturers to ensure that disassemblable connection systems are up to code.SDOs can also work with research,material,and certification partners to develop new standards on the safe reuse of building materials,which is especially critical for reuse in both structural and non-structural applications.Currently,codes do not allow the use of reused materials for structural applications,and they are generally silent on their use for non-structural ones.Benefits to the actor Mobilizing existing circular standards can create new revenue opportunities by increasing the sales of standards documents.More broadly,it facilitates SDO objectives to develop technical standards that improve health,safety,and the environment.5.3.5 Industry AssociationsRole in activating the circular built environment Industry associations play an important role in raising awareness about circularity and communicating successful developments.Industry associations can reach many industry actors and can translate adaptive design principles to align with industrys acute concerns(e.g.,performing on time and on budget).Industry associations disseminate knowledge,influence regulations,and provide fuel for innovation among their member actors.Further,industry associations can encourage members to reuse existing buildings or materials,or both,as well as point them toward key resources for moving forward.Industry associations could also showcase successful pilot projects to architects,engineers,developers,and owners.Industry associations can also collaborate with other industry actors to launch a design challenge to further motivate their members to integrate circular practices into their work.Industry associations can connect direct actors with other enabling groups and can leverage their existing influence among their members,who already turn to them for guidance,information,and advice.Benefits to the actor Industry associations in the Canadian built environment space currently educate their members on sustainability and motivate sustainable choices.Existing sustainability programs offered by industry associations generally focus on energy efficiency rather than circularity.Expanding their sustainability education efforts to include adaptive design and building reuse can help industry associations educate and activate the most forward-thinking of their members to provide a valued service.It also ensures that they remain competitive in their sustainability efforts alongside other industry associations.5.3.6 Circular Built Environment Non-governmental OrganizationsRole in activating the circular built environment NGOs are important players in facilitating a CBE.NGOs can support circular practices by convening and educating different industry actors,acting as a critical bridge between potential future collaborators.They can develop educational materials to share with other partners(e.g.,industry associations);connect people to promote knowledge sharing and new partnerships;and research,write,and disseminate successful case studies.NGOs can explore opportunities for collaboration(e.g.,with industry associations),discuss opportunities for scaling up circular building design programs in higher education(e.g.,the Applied Circular Economy microcredential offered by British Columbia Institute of Technology BCIT),match investors with THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION19csagroup.orgCBE businesses,and develop knowledge sharing resources and avenues to be used by those working directly in the built environment industry.Benefits to the actor NGOs who contribute to the circular economy space can advance their mission by engaging directly with the construction sector given its prominence in the Canadian economy and its high-impact potential to become more circular.Given that the full benefits of adaptive design may not manifest for a few decades(i.e.,when todays new buildings would typically be demolished),mobilizing efforts around adaptive design is crucial in helping CBE NGOs to reach targets for future circularity of the built environment.5.3.7 Higher Education and Research Institutions Role in activating the circular built environment Higher education and research institutions directly influence the next generation of actors working within the built environment.Their role in promoting circular practices includes educating emerging architects and engineers on how to execute adaptive design.By teaching circularity concepts to students,new architects and engineers will join the workforce better equipped with the knowledge and tools to consider adaptive reuse,adaptive design,and material reuse options.Updating curricula can be slow,however,existing CBE training programs can further develop and serve as a template for other institutions to adopt,such as the BCITs Applied Circular Economy microcredential.Additionally,professional associations can facilitate these efforts by advocating for the inclusion of specific skills in more traditional architecture and engineering programs,leveraging the growing momentum behind life cycle assessments and embodied carbon reporting requirements.Benefits to the actor Higher education programs benefit from teaching circular design and execution skills because this positions them as sustainability forerunners and promotes innovation in their trainees.Firms may move toward greener or more circular processes,or both,in the coming years,and therefore will be looking for graduates who are well versed in these concepts.Expanding curricula to include circularity will ensure that higher education institutions remain competitive when recruiting prospective students.6 A Strategic FrameworkIn this section,we present a strategic framework that details actions needed to mobilize various industry actors(Section 5)to implement the elements of a CBE(Section 2.2).We focus primarily on short-term actions(those possible within one to three years),because the downstream impacts of early actions on complex systems can be difficult to predict.Some actions can catalyze significant changes,whereas others lead to limited change.Each action and its subsequent effects reveal increasingly more about the overall system;therefore,it is important to nudge the system forward,re-evaluate the landscape,and then reprioritize subsequent activities.For these reasons,we categorize the actions into three stages.These stages are repeated quickly over time in first,second,and subsequent moves.The first moves involve front-runners,and subsequent moves involve fast followers and ultimately the broader community.This process of scaling up involves relatively small experiments and nudges that build on each other.The general process is illustrated in Figure 3,and details of the action plan are provided in subsequent subsections.Figure 3 illustrates our theory of change.At the beginning,front-runners work to lift barriers and establish the preconditions(Stage I)for circular building projects(Stage II),followed by celebrating wins and communicating learnings from CBE projects(Stage III).This process is then repeated,widening the circle to include fast followers the second time around,ultimately moving toward widening the circle to include mainstream actors.Stage I sets the preconditions for the CBE(Section 6.1).The primary objective of this stage is to remove barriers or frictions that have prevented a CBEs development.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION20csagroup.orgFigure 3:The process for mobilizing systems change for a CBEIf these barriers or frictions are not addressed,then any force applied to mobilize a CBE will be resisted.These frictions can range from industry members lack of familiarity with the CBE concept to CBE barriers in the national model building code,which is implemented with adaptations in provincial building codes.It is noteworthy that enabling actors typically play a bigger role in this stage than direct actors.Enabling actors help to reduce barriers in the system,which then makes it easier for direct actors to create change.Enabling actors can update provincial and national building codes(such as by including adaptive design and material reuse),policies(such as municipal zoning laws to make adaptive reuse easier by allowing sites to change between commercial and residential uses)and provide incentives(such as municipal governments fast-tracking permits for circular building projects).Further,enabling actors can convene coalitions of direct actors who are the front-runners,and this convening function can help direct actors to coordinate collective action.These front-runner direct actors,especially,are willing to experiment and invest in new,potentially unproven,solutions.These champions and early adopters can work with their organizations and industry associations to build awareness around the concept of circularity,why it is valuable,and how to implement it.Stage II involves the project activities driven by the central and direct actors(Section 6.2).The primary objective in this stage is to mobilize the circular economy.Relatively few activities are driven by this group,primarily because only the direct actors are involved:owners/developers and architects/engineers,ideally in collaboration with each other.M MFIERSTOVSESSCONDOVETHE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION21csagroup.orgOwners/developers can benefit from learning more about circular buildings and architects/engineers can refine the communication of CBE design qualities and proposed value to their clients.Additionally,architects and engineers will need to know how to design and create buildings to meet circularity standards.Material manufacturers contribute by providing connection systems that can be disassembled,and deconstruction and salvage companies can recover valuable materials at the end of a buildings life for future use.Stage III promotes successes by communicating and celebrating quick wins(Section 6.3).The purpose of this stage is to publicly endorse and exhibit the work to motivate more actors(i.e.,fast followers)to replicate the circular building practices demonstrated by the front-runners.Fast followers,who tend to be a bit more risk averse than front-runners,will be willing to implement innovations shown to work.A fast,iterative process will increase the visibility of feasible and successful CBE projects to allow future projects to build upon these successes and bring more fast followers on board.In Section 7,we describe how actors can further mobilize these actions to ensure that the CBE elements described in Section 2.2 will emerge.6.1 Preconditions:Removing FrictionsOne of the biggest overarching challenges we have seen in the transition to circularity in the built environment is the lack of clarity on where or how to begin.This challenge has been described as a“chicken and egg problem”countless times in our interviews and desktop research.There appears to be a general sense among potential actors we spoke with that a great deal of coordinated change needs to occur.Due to the complexity and magnitude of coordinated action required among various actors to push the industry toward circularity,enabling actors can provide critical leadership by convening central actors,direct actors,and other enabling actors to work in parallel through strategic partnerships.In particular,provincial and federal governments and NGOs are well positioned to address these barriers and drive industry transformation.By initiating a set of preconditions,we can establish an environment that facilitates circular building projects to break through that paralysis,as shown in Table 1.These precondition actions can be implemented primarily by enabling actors to reduce barriers that prevent owners/developers from choosing to launch circular building projects.6.1.1 Building AwarenessFirst,owners/developers need to be aware of existing circular building principles and the benefits of their implementation,including clarity on what CBE entails.In the first moves to support building awareness,enabling actors will define concepts related to the CBE(e.g.,through standards),develop educational materials,and begin the process of educating direct actors through channels like industry associations.At this stage,we recommend that an enabling actor(e.g.,an NGO)takes the lead on developing a guide for how different actors can begin incorporating CBE practices into their work and how to manage new collaborative relationships for CBE projects.The second moves from this space will build on the first moves to educate direct actors on how to implement technical CBE standards and formalize educational pathways,such as through higher education institutions.Centring the three CBE elementsadaptive reuse of existing buildings,adaptive design of new buildings,and material reuseis likely to resonate more than emphasizing the general concept of circularity,as these elements are more specific and familiar.SDOs can play a key role in characterizing these CBE elements by developing standardized definitions and providing harmonized technical guidance.Likewise,the federal and provincial governments can begin incorporating CBE concepts into building codes as well as CBE-specific financial opportunities(e.g.,grants)and procurement policies,whereas municipalities can develop CBE language in their permitting and zoning bylaw decisions.Additionally,emphasizing the future-proofing benefits of adaptive design is likely to resonate most with owners/developers,since it allows buildings to change as the markets needs change.Industry associations can be valuable conduits for introducing CBE principles to their members.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION22csagroup.orgTable 1:Points of friction and proposed solutions Proposed SolutionsKey ActionsPoints of Friction Addressed by ActionsBuilding Awareness Building awareness around circular building principles(e.g.,adaptive re-use of buildings,adaptive design,and material reuse)and their benefitsActors lack capacity,understanding,and/or support systems to initiate changeBuilding Awareness Motivate architects and engineers to propose circular approaches to their clients The entrenched mentality within the construction sector that“its the way things have always been done”Physical/Financial Viability Centralizing warehousing and reuse markets to ensure reusable materials are as easy to access as new materialsDifficulties in accessing reusable materials,especially within tight project timelinesPhysical/Financial Viability 3D scanners and artificial intelligence tools can help determine what mate-rials are in a building to identify their reuse options Enable architects and owners to maintain better records to facilitate easier reuse,adaptation,and material recovery Lack of information on the circular potential of existing buildings Physical/Financial Viability Prioritize high-leverage adaptive elements,such as footings for future interior walls,to allow for spatial reor-ganization and non-adhesive connec-tion systems so that materials can be more easily reused Fully adaptable design is expensive Physical/Financial Viability Prioritize research on structural appli-cations of reclaimed materials Develop standards and certifications for structural reuse of reclaimed materialsLack of information on the structural applications of reclaimed materialsBuilding Coalitions Establish integrated design process-es that allow different actors to work together from the onset of a projectActors are overly siloed and operate within familiar contexts and with the same contractors,which limits exposure to new opportunities and emerging industry trendsTHE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION23csagroup.orgInitial actions:Building awarenessFirst moves SDOs should develop and update their standards that define the three big ideas:adaptive reuse,adaptive design,building material reuse.NGOs should offer industry associations template educational materials that can be customized for their audiences.NGOs and industry associations should offer specific language to use in RFPs to ask for circularity.NGOs and industry associations should offer awareness-building education on the CBE concept and begin offering technical trainings.Second moves SDOs should educate direct actors on how to implement technical CBE standards.Industry associations and higher education institutions should offer technical trainings and formalized education pathways.Federal,provincial,and territorial governments should:Incorporate CBE criteria into the national building code,provincial building codes,and permitting and zoning decisions.Improve procurement policies that favour reuse and waste diversion(see Phase 1 report 1 for further details).Activate the transition to CBE practices by offering grants for research and technology transfers,and providing financial incentives to incentivize market uptake(see Phase 1 report 1 for further details).The aesthetics of circular design should also be at the centre of CBE educational efforts.The attractive and creative nature of circular design is especially important for promoting circularity among architects,since many self-identify as artists.The aesthetic opportunities afforded by circularity can also be a strong motivator among owner/developer clients.The best of circular design should be showcased by all actors(e.g.,NGOs,industry associations,industry media)to educate industry players about the various opportunities presented by circularity.Once owners/developers are motivated to build a circular building,they need to find partners that know how to implement circular projects.Therefore,additional education on the technical details of implementation will support next steps.This is where industry associations and higher education institutions can have significant impact.Although many of the technical details are known in principle,best practices will emerge as circular projects are implemented more widely.These best practices can be distributed to owners/developers and architects/engineers through industry associations and mediaas seminars and workshops,technical case studies,videos,and online resources and repositoriesto generate a positive feedback loop between success stories and education.6.1.2 Building Physical ViabilityNext,actions are needed to pave the way to allow circularity to be physically viable.This relates to the physical materiality of buildings and the materials used THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION24csagroup.orgin their construction.The first moves in this space involve educating architects/engineers on the technical aspects of circular design,researching and developing disassemblable building connections,and researching future applications of salvaged building materials.The second moves focus on developing standards for these new connection systems and reused material applications so that they can be brought into practice.In adaptive reuse,the biggest physical challenge is uncertainty around what exists behind walls and how buildings can be reused.Oftentimes,building information is lost with time.Although original blueprints may be accessible,details on subsequent renovations may be missing.Additional concerns,such as mould and asbestos,are often not easily visible,and owners/developers may be hesitant to take on a building project without a complete understanding of potential or unexpected issues.Luckily,3D scanning and artificial intelligence tools can now model existing buildings and assess their structure and general condition,which can alleviate some of these uncertainties.For adaptive design in new builds,builders and designers face challenges associated with the material used for the structure itself and the design of connecting elements that can be taken apart later.Oftentimes,modern buildings are held together with permanent adhesives,which are cheaper and faster to use than more mechanical means of connection,but these structures cannot be easily disassembled.Material manufacturers can play a big role in overcoming this physical barrier by innovating connection systems that can come apart and bringing them to market.From there,architects/engineers will need to learn how to incorporate these connection systems into future designs.This can also be done to address and design structures with materials that can more easily be inspected and reused for structural purposes.Moreover,a checklist of adaptive design elements could be developed by CBE NGOs to better enable adaptive designs uptake in practice.The physical barriers to material reuse require more research.At the most fundamental level,gaps in knowledge remain about if and how structural building materials can safely be reused in structural applications as well as how to certify them for reuse.Builders also often lack information about a materials history(e.g.,load bearing,ultraviolet light exposure,cyclic loading fatigue,corrosive environments),which can affect material safety and structural condition.For example,a wood beam that has borne a heavy load for many decades may not necessarily be appropriate to use for load bearing in a new buildings structure due to its potentially compromised structural capacity.Developing and understanding methods to appropriately assess and demonstrate the safety of reused materials is a critical component of unlocking this pillar of the CBE.Additionally,deconstruction companies can work to begin building partnerships with reuse/recycling intermediaries to aid in the distribution of salvaged materials.6.1.3 Building Financial ViabilityWhen CBE projects are physically viable,the next hurdle is ensuring that they make financial sense.The first moves in this space are to explore opportunities for favourable financing instruments and development policies,and the second moves are to implement them.With circular buildings,the financial benefits tend to accrue over the buildings lifetime,and upfront costs are often higher than in conventional projects.Adaptive reuse of existing buildings can be more expensive than building new if they require radical reconfigurations,such as converting office buildings into housing.Adaptive design may be more expensive if downstream actors are brought in earlier(i.e.,in an integrated design approach)or if disassemblable connectors take more time to install than adhesives.Material reuse is often more expensive than using new materials,in part due to their limited availability and the labour costs associated with deconstruction.Over the long term,however,there can be financial benefits,as assets can retain value through reuse and adaptation,and further financial value can be captured from reclaimed materials that may otherwise end up in landfills.The challenge,then,is to drive a shift to life cycle costing and total cost of ownership methods.For instance,framing circularity as an opportunity to avoid eventual losses in the life cycle of various materials will also increase the uptake of circularity practices that support pro-environmental action 22.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION25csagroup.orgInitial actions:Physical viabilityFirst moves Industry associations can educate architects/engineers on digitized tools,such as 3D scanning and artificial intelligence tools,for analyzing existing buildings.Material manufacturers need to ensure that there is a demand for connection systems that can be disassembled before they invest in research and development.NGOs should develop checklists for adaptive design elements.NGOs can work as an interface between material manufacturers and owners/developers and architects/engineers to help make a market.SDOs and material researchers can prioritize research that studies how to safely use and certify reclaimed structural materials for structural applications.SDOs and material researchers should also study methods of monitoring and conveying the load history of materials,which impacts their future safety.Second moves To replace adhesives,material manufacturers need to innovate,communicate,and distribute connection systems that can be disassembled.SDOs should specify how to certify material systems that can be disassembled.SDOs should publish standards and certification specifications for reclaimed structural materials.One step toward financial viability is opening new funding pathways to make circular building projects more financially viable for owners/developers.NGOs can explore potential sources of funding,possibly joint funding,from investors and government agencies.The aim would not necessarily be to unlock vast amounts of funding,but just enough to bring attention to the opportunities and tip the balance in favour of circular projects.NGOs could make a case for funding circular projects for both the financial benefits looking at the whole-life cost(e.g.,future-proofing future assets against loss of value using adaptive design)and the ESG benefits,which make such projects particularly attractive to investors and governments.NGOs could gather evidence from existing circular projects to quantify the benefits and serve as valuable examples of circular building practices in Canada.Additionally,municipalities can reduce the financial barriers to adaptive reuse by waiving or deferring development fees(which fund sewage systems,roads,utilities,and so forth),fast-tracking development permits,reducing property tax over a ten-year period,or subsidizing adaptive reuse projects.Such concessions are likely best positioned as“affordable housing”or“downtown revitalization”initiatives,as the term“circularity”may not resonate with voters.Finally,new insurance products can help make circular buildings more financially viable.NGOs can explore opportunities with insurance companies to offer preferred rates or lower premiums for adaptive reuse because buildings will remain vacant for less time during renovations than in a new build.The challenges in managing and protecting vacant buildings makes them particularly high risk for insurance companies.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION26csagroup.orgInitial actions:Financial viabilityFirst moves NGOs can explore potential sources of funding,possibly joint funding,from investors.NGOs can explore opportunities with insurance companies to offer preferred rates or lower premiums for adaptive reuse.NGOs explore how to report on historical performance of existing buildings to demonstrate lower risk profiles.NGOs,research institutions,and/or municipalities can help to identify opportunities to facilitate material reuse,such as space offered by municipalities to store such materials.Second moves Government agencies should develop funding programs and policies.Municipalities can reduce the financial barriers to adaptive reuse by waiving or deferring development fees(which fund sewage systems,roads,utilities,and the like),fast tracking development permits or subsidizing adaptive reuse projects.Putting them back into active use by adapting these buildings for new uses accrues benefits to both owners and insurance companies.The reuse of materials and other circular practices may also be considered high risk,and they may even push for higher rates unless they are also provided with evidence and information that circular practices can be done in a structurally reliable and predictable manner.The structural reliability of structures built using reused materials may be strengthened by development and adherence to safety standards and material certification.Having projects implementing circular practices proceed in a predictable manner may be improved by developing accepted processes for implementing circular practices.Additionally,NGOs can take the lead on researching how to evaluate and report on the historical performance of renovated buildings to demonstrate the lower risk profile.6.1.4 Building CoalitionsFinally,coalition building and collaborating are essential for influencing systems change.New networks need to be formed that permit sharing information and executing circular elements.The first moves in this space are to engage front-runners in an active coalition,and the second moves are to bring fast followers into the fold.For example,CELC and CSA Group have been important players in building CBE coalitions through the ongoing work by their Strategic Advisory Committee(SAC).The members of these groups hold significant expertise in developing and implementing a CBE roadmap.These leading organizations continue to engage their networks and ask partners to invite other experts,so CBE extends beyond the front-runner organizations that are already engaged.As we discuss in greater depth in Section 7.2,we have found industry actors outside of the current core CBE actors(e.g.,mainstream developers and architects)interested in engaging on topics that would be considered CBE.Since they are not explicitly positioned as circular design or development firms,they are not obvious recruits for CBE coalitions.These actors can be key in demonstrating the value of CBE to mainstream industry players who THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION27csagroup.orgInitial actions:Building coalitions CELC and CSA Group continue their SAC coordination.SAC members actively build their own coalitions around specific areas of focus(as has already begun because of this work).Other NGOs can follow suit by developing new opportunities for collaboration between key actors.CELC and CSA Group should convene both the CBE front-runners and these fast followers in synchronous workshops to continually iterate to identify the language and collaboration opportunities that will mobilize change.CELC,CSA Group,other CBE NGOs,and industry associations act as matchmakers to make direct connections between organizations.might relate more closely to peer firms with similar mandates and organizational purposes than to firms focused specifically on circular buildings.We suggest convening both the CBE front-runners and these fast followers in synchronous workshops to continually iterate to identify the language and collaboration opportunities that will mobilize change.CBE NGOs and industry associations can also act as matchmakers,directly connecting organizations to support their activities.For example,CBE NGOs can match investors with emerging CBE businesses to help them scale,and industry associations can engage with educators on the skill development needs for CBE implementation.For material reuse specifically,we have identified a need for CBE NGOs to incubate reuse and deconstruction actors to scale their operations and demonstrate their business case.6.2 Project Activities:Moving ForwardThe project stage involves the technical aspects of creating a circular building.This phase is centred on the relationship between owners/developers,architects,and engineers.These are key relationships,as they are where most of the big decisions are made.If circularity is not considered upfront in planning the project phase,it will likely not work its way into the plans later in the building cycle.First movesThe first moves in this stage will be done by front-runner firms that already have an interest in CBE.Circularity in building projects starts right from the proposal phase.If owners/developers already know they want to develop a circular design,they can submit it in their requests for proposals.They can build on boilerplate language developed by the enabling actors in the precondition phase.When owners/developers do not ask for a circular building,architects can advocate for circular design approaches.They can use educational materials developed in the precondition phase to demonstrate the value of circular building projects.Although it is beyond the scope of this report to specify all the design and construction practices needed for circular building projects,some key initial actions can start moving the needle toward a CBE.For adaptive reuse,architects can play a proactive role in identifying and suggesting buildings with high potential for reuse.In so doing,they should look at the value of the building itself and not just the cost of land.If the owner/developer client is open to suggestions,they may even be able to advocate for new builds to instead be adaptive reuse projects if they are able to find an existing structure that would meet the clients THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION28csagroup.orgneeds.When it comes time to begin the adaptive reuse design,architects/engineers can use artificial intelligence scanning tools to assess existing buildings,overcoming the challenge of knowing what is within the walls when accurate blueprints are not available.For adaptive design,architects/engineers need to make sure that buildings can be disassembled.They can do this by avoiding adhesives in initial construction and instead using building materials conducive to disassembly and disassemblable connection systems,which material manufacturers will hopefully bring to market in the precondition stages.Architects/engineers can design assemblies to access critical layers,which both makes disassembly easier and allows for more thorough maintenance during the buildings lifetime.This more thorough maintenance in parts of buildings not normally easily reachable might make for easier adaptive reuse before it is time to disassemble the building.Working in an integrated design process with owners/developers and builders can help design teams identify opportunities for costing savings and efficiency,as well as with ensuring clarity in the building process when asking for non-standard designs.Emerging contractor-led approaches such as collaborative contracts and integrated project delivery with shared risk/reward models offer better systems of collaboration and communication and encourage project teams to explore innovations that will maximize project value.Although circularity is not always feasible to achieve in buildings since fully disassemblable design can be prohibitively expensive,architects/engineers can make some simple design choices that allow for at least some future adaptability.For example,they can integrate design features that facilitate long-term updates to a given structure,such as including footings under the floor that allow for new interior walls in the future.At the end of circular building projects,it is important that architects/engineers and owners/developers ensure that the appropriate documentation is complete to allow future reuse of the building or its materials.This includes updating building blueprints(especially QuebecWeb-Recyc offers a matchmaking platform for the direct transfer of used bricks between projects 18.important in adaptive reuse projects with pre-existing blueprints),documenting the overdesign elements that allow for later adaptation,specifying where disassemblable elements were used in the building,and indicating which materials are reused since their strength can degrade over time(ideally,reused materials use and load history would also be known and documented).These records will help set up the preconditions for easier reuse,adaptation,and material recovery in the future.Second movesThe second moves will primarily be driven by fast followers implementing the first moves.As these actors join CBE coalitions in the precondition phase,they will learn how and why to implement circular design strategies in their building projects.They will have the benefit of success stories from the first moves,which they can learn from in their projects.These case studies can also be used by front-runners continuing to develop their circular design offerings.Ideally,these success stories will help architects more effectively and persuasively pitch circular building projects.Additionally,the second moves are where material reuse will come into the design process.Deconstruction firms will play an important role upfront in the project planning by flagging materials that can be reused on-site in adaptive reuse projects or by working in an integrated design process at this stage to help more effectively design for salvaged materials or disassembly.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION29csagroup.org6.3 Communicating and Celebrating Wins:Amplifying Actions6.3.1 The Value of Project Success StoriesOnce the circular building is done,the story does not end.Success stories can fertilize the operating environment to help others adopt circular building practices.They can offer inspiration,data on the performance of new approaches,and an overview of how they were done.Demonstration projects can even form the basis for future policy,which would give them an impact beyond incremental“project by project”change.The first moves in this space are to collect and write case studies with as much practical detail as possible.The second moves are to disseminate them through industry media,networks of municipalities,industry associations,and other networks.6.3.2 General PrinciplesThe way in which success stories are communicated can impact their usefulness as tools of inspiration and persuasion.A few overarching principles can make them more effective,which are described below.First,communicating outcomes through as many lenses as possible will support the overall takeaways.Owners and developers will need to be convinced that emulating the pilot will reduce,or at least not increase,risks and costs and improve a buildings performance.Contractors will need to know how the pilot was done.This will allow authorities with jurisdiction(e.g.,municipalities)to learn what kinds of code and/or policy changes can remove barriers.Second,it is important to include as much detail as possible,as described in the fictional scenario presented on page 31:Imagining the future of circular building project.It is especially critical to make these principles translatable to different regional contexts to increase feasibility amid different policies,climates,building stocks,population needs,and the like.There is a tendency for a reflexive dismissal of case studies in their application to different contexts,such as“That cant work here.”Although there is much to learn from abroad,especially Europe(e.g.,The Netherlands,which informants told us has particularly innovative CBE initiatives),it is important to share successful pilot projects among Canadian actors so that actors Details to include in communication of pilot success storiesThe more details included in the communication of pilot projects,the more useful they will be for mobilizing future action.Specific particularly useful details include:The overarching strategy and,if relevant,the aesthetic principles What you did How did you do it?Who did you engage with?How your normal processes changed?How did you deliver differently(e.g.when working with the contractor and trades)?Impact Cost(capital cost for the budget?Longer-term operational life cycle costing?)Operations(maintenance,durability,and so forth)People who use the building Performance Material performance(e.g.same application as usual or something new)Structural performance(e.g.efficiency,resiliency,other criteria)Barriers to overcome/lessons learned,including transparency around what not to do What hurdles you had to overcome(e.g.city process policy,supply chain issues,working with a contractor)Contextual nuances for translating across Canada Local policies,climate,and so forthTHE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION30csagroup.orgcan access greater context and applicable information.As such,these lessons need to be translated into the Canadian context by key actors.Likewise,the differences between local contexts in Canada mean that pilots need to explicitly address regional circumstances;what works in Vancouver may initially seem irrelevant in Toronto,Montreal,or Halifax,although central elements can be applied across regions.Third,when appropriate,the aesthetics of circular design should be celebrated.In particular,architects tend to be motivated by opportunities to flex their creativity and design something beautiful.As much as possible,circular design should be framed as attractive and an opportunity to infuse creativity and design.Finally,it could be beneficial to acknowledge that prices in a pilot project may have been higher than if there were economies of scale.For example,niche materials or parts that enable circularity will likely become less expensive over time as they become more mainstream and accessible.6.3.3 Collecting and Disseminating Success StoriesVarious actors can play an important role in collecting and disseminating success stories.For instance,it may be beneficial for one enabling actor,such as a CBE NGO,to take the lead on collecting and disseminating pilot cases.They could collaborate with architects,owners,and developers to identify exciting pilots,giving those actors the benefit of publicity.Industry associations,media,and conferences can also play a key role in sharing these stories.The success stories should be mobilized through numerous channels and media,including magazines,trade shows,seminars,podcasts,and YouTube channels.It is important to reach industry actors,such as owners,developers,architects,and engineers,where they areespecially for those not seeking out information about circular building approaches.Additionally,it is critically important to reach industry actors not explicitly positioned as CBE firms.The fast followers among this group will be instrumental in creating momentum and involving more skeptical industry actors.6.3.4 How Might Pilot Case Studies Be Used?Case studies showcasing successful pilot projects can activate actors in a variety of ways.Architects often use cases to demonstrate to clients what is possible.They can utilize case studies with owner/developer clients reactively if the client asks for circular approaches or proactively in pitching their initial vision presentations at the beginning of the engagement when the client is most open to ideas.The most progressive clients may want to go beyond emulating pilot cases to instead“leapfrog”them and position themselves as innovators in the space.Owners/developers may use them to figure out how to implement circular strategies.They can pass along detailed case studies to their contractors,who in turn can use that information to explore how they can implement that solution.Having this information in one place can save time.Municipalities can share their experiences with one another(e.g.,model bylaws,policies,and programs to accommodate existing buildings)and translate success stories into their local contexts.Existing networks,such as those among the municipalities of Metro Vancouver or the Canadian Circular Cities and Regions Initiative,are good places to exhibit this kind of knowledge sharing.CBE NGOs can collect and/or disseminate pilot case studies as part of their mobilization work.7 Mobilizing Action in the Future7.1 Ongoing Engagement and EmergenceIn moving forward to mobilize the actions laid out in this report and the companion report written by SCIUS Advisory,we recommend maintaining an ethos of flexibility and adaptation 1.Transforming the built environment is a complex systems problem in an unpredictable operating environment,making it essential to evaluate and adjust over time.However,building projects lengthy timelines should be factored into the timing of feedback and evaluation points.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION31csagroup.orgImagining the future of circular building projectsHow could the pieces in this action plan work together in practice?Heres one fictional scenario that will hopefully become reality:In Canada,Developer X wants to create a new office building in City Y.They look into existing locations for their project and find a location where a small mall exists but is closing down.The Developer examines the buildings specs and learns that its location and size may work with their plans,so they consult with an architect to identify opportunities for adapting their plans to be accommodated within the existing structure.They connect with City Y and learn about the special building permit allowed for circular projects.The architect realizes that a portion of the building will need to be replaced and reaches out to an NGO for recommended resources to achieve circularity in this part of the project.Together,they identify a demolition company that will disassemble most of this section.The remaining sections will be adapted for the new office space,and a manufacturer is identified that has started creating disassemblable fittings so that the new section can be adapted down the road.After the renovation is complete,the architect and owner agree on how to store and maintain the building records for the future.The NGO works with the project team to write up and share a case study on this project.To make true systems change,it is important for initiatives to“scale up”and“scale deep”so that future configurations can emerge.Scaling up in the systems change context is the adoption of the initiative not just by a few isolated actors but also actors that span geographies and sectors.Scaling deep happens when actors embed these ideas deep in their practices and psyches,changing what systems theorist Donella Meadows calls a groups“great big unstated assumptions”23.As systems change is hard to predict,it is important that numerous high-profile initiatives show both the viability and benefits of circular building projects.In complex systems,new patterns(e.g.,industry trends)emerge over time due to interactions between individual components(e.g.,actors)and as more actors adopt new behaviours that can move the entire system forward.As such,systems-wide change can be driven by success stories upon which other success stories can build.The more visible CBE projects are,the less such buildings seem like clever one-offs.This is the approach of nudges and experiments characteristic of systems change.To do this,we recommend balancing top-down alignment and bottom-up emergence.This means having a central actor(or actors)leading the mobilization efforts and aligning organizations for collaborative action,while simultaneously making space for the discrete needs of organizations within the coalition.It is particularly valuable to regularly have synchronous engagements with coalition organizations.These should include time for facilitated interactions that allow participants to adapt and build upon one anothers ideas.This means that when CBE coalitions meet,their meeting agendas should not just comprise information dumps but rather include time for dialogue and ideation.Coalitions should also hold workshop sessions when making plans for new initiatives or building broader strategies for systems change.These workshops should have focused goals,utilize relatively small breakout groups,and leave time for discussion and reaction.Flexible visual tools,such as sticky notes,should be used so that participants can move,add to,cluster,and build on one anothers ideas.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION32csagroup.org7.2 Actors to TargetTo transform the system,we recommend first engaging front-runner organizations and individuals already promoting circular building approaches.The next target should be fast followers,organizations and individuals that are interested in some aspects of circularity in buildings but have not shown external leadership on the issue.These actors will be more difficult to identify than explicitly circular ones,which is why it is important to bring CBE messages to broader industry audiences with clear avenues for engaging(e.g.,joining a CBE coalition or participating in workshops)so that these people can make themselves known to initiative leaders.In our research,we found that actors outside of the CBE forerunners are already thinking about these issues,though not necessarily using the term“circularity.”For example,we heard from a representative of a real estate company that develops and owns residential and commercial properties:The biggest issue that comes up often in my world right now is really understanding how we can future-proof our new builds.What are people going to need in 30 years?We dont have a crystal ball to do that but finding ways to design the space with more open corridors,less structural walls,etc.,we have more flexibility with redesigning or even selling the building in the future.Even though the term circularity is widely known,it does not necessarily resonate widely among industry actors.Outside of a few front-runners,most industry actors believe that a CBE will add more work,add more time,and involve more people.Further,a CBE also evokes images of practices related to the end-of-life of buildings,rather than images of increasing the use life of buildings.We recommend that more salient descriptors than circularity be foregrounded when communicating with built environment industry actors.Concepts like future-proofing and affordability connect to broader discussions already happening in the industry and society more broadly.They will therefore likely result in wider engagement from industry,as circularity seems to be unfamiliar for those outside of front-runner CBE organizations.Thus,the coalition of the willing may be larger than it seems.In the short term,agile actors in the front-runner and fast follower categories with agency to influence design and development processes,such as architects whose clients give them wide latitude to freely make design choices,will likely be the most effective agents of change.Oftentimes,actors newer to the field(e.g.,new graduates)are more forward-looking and more likely to embrace CBE.Those rising into leadership positions,such as architecture firms junior partners,are particularly salient levers of change.The most effective actions for these groups will have the fewest touchpoints with other actors,decreasing the likelihood of roadblocks.Larger actors(such as the federal government,large corporations,and large industry associations)are often slower to act,but they play an important role in setting values,incentives,targets,and language.They also have tremendous purchasing power and can lead by example with their own projects.For example,federal green procurement initiatives can send market signals that trigger the development of new products that fit their requirements.Smaller actors,such as small corporations and municipal governments,can often move more swiftly.7.3 Prioritizing ActionsAs a concrete roadmap is developed in the next phase of this project,we recommend prioritizing actions based on:their ability to lift barriers and/or capitalize existing enablers,identified in the Awareness Mapping phase of the Compass methodology(see Section 9.2);how they connect to the three social outcomes of affordability,profitability,and/or climate resilience;and their potential to inspire others to try similar approaches.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION33csagroup.orgThe third point may seem nebulous,but it is particularly important.Ultimately,the system needs culture change in both the industry and among consumers to move away from the expectation of always building new.Leveraging pilot projects can make new approaches visible,definable,and imitable,ideally leading to the normalization of circular innovations and shifting the culture.In moving forward,these prioritization principles can be employed and refined to identify which specific actions outlined in this report and the corresponding Phase 1 report written by SCIUS Advisory to implement 1.Although changing a complex system like the built environment is difficult,we see points of optimism.Given the eager engagement in our workshops and interviews,there is clearly energy in this space.We have seen this energy particularly among younger actors who will be the future leaders,boding well for a culture shift toward a CBE.7.4 Future Research and ExplorationAs CBE initiatives are implemented,there will be a continual need for new areas of research and application.Through the process of collecting feedback on this report,we have identified areas that may be particularly fruitful for future research.First,future research should more deeply investigate the role of information and communication technologies in the CBE transition.Particularly fruitful areas of technology research include the creation and leveraging of digital assets;the development of digital collaboration platforms;and the application of artificial intelligence,machine learning,internet of things,and robotic technologies.It is likely that new enabling actors will emerge as these technologies and their CBE applications continue to mature.Second,more research could be done on potential roles of other actors in the system.For example,city planners can play an important role as enabling actors,and future research can explore how to ensure that they are more aware of CBE prior to making critical planning decisions affecting all other downstream actors.Additionally,further research can dive into the nuances of relationships and communication channels between actors in the system,especially in governmental agencies that may have jurisdiction over different aspects of CBE(e.g.,city planners and procurement specialists).Finally,future research can delineate how to mobilize CBE technical expertise most effectively.For example,SDOs can create technical subcommittees with the engineering and industry expertise to address some of the barriers,and SDOs and government bodies can embed CBE experts into technical committees for code development,standards,and so on.THE CIRCULAR BUILT ENVIRONMENT IN CANADA:A STRATEGIC FRAMEWORK FOR FUTURE ACTION34csagroup.org8 References1 H.Goodland and K.Walsh,The circular built environment in Canada:A review of the current state,gaps and opportunities,Canadian Standards Association,Toronto,ON,Canada,2024.2 Delphi Group and SCIUS Advisory,Circular economy&the built environment sector in Canada,Delphi Group,Ottawa,ON,Canada,Apr.9,2021.Online.Available:https:/delphi.ca/wp-content/uploads/2021/04/Circularity-in-Canadas-Built-Environment-Final-Report-April-14-2021.pdf3 Circular Economy Leadership Canada and Circular Innovation Council,Circular economy action plan for Canada,Circular Economy Leadership Canada,Canada,2023.Online.https:/www.circulareconomysummit.ca/_
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MaMay y 20242024The Dual Impact of Lower Mortgage Rates on Affordability and Availability of HomesNational Association of REALTORS Research GroupRNAR Research and R StaffLawrence Yun,Ph.D.Chief Economist and Senior Vice President,NARJessica Lautz,Dr.of Real EstateVice President,Deputy Chief Economist,NARMeredith DunnResearch Manager,NARDanielle HaleChief Economist,RSabrina SpeianuEconomic Data Manager,R2024 National Association of REALTORS All Rights Reserved.May not be reprinted in whole or in part without permission of the National Association of REALTORS.For reprint information,contact datarealtors.org.IntroductionAffordability is far from a novel concern.It has consistently been a challenge,deteriorating over the past decade with only a few years as exceptions.Fast-rising home prices,driven by the mismatch between housing demand and housing supply,contributed significantly to increasing borrowing costs and,subsequently,diminishing the purchasing power of home buyers.However,affordability has been aggravated even further in the last couple of years,sinking to new record lows.This was largely a result of rising mortgage rates,driven by the Federal Reserves monetary policy of higher interest rates.Specifically,with a 10%down payment,home buyers now face a monthly mortgage payment of$2,330 for a$400,000 home,compared to$1,880 before the pandemic when mortgage rates were about 2 percentage points and home prices lower than now.Meanwhile,affordability is interconnected with the availability of homes.Lower affordability also results in fewer affordable options,particularly for lower-and middle-income buyers.For example,currently,there are about 37%of the listings that home buyers earning$100,000 can afford to buy,a stark contrast to the higher percentage of over 60%that they could afford before the pandemic(62%in February 2019).This decrease in affordable options stems not only from a decreased supply of homes but also from the fact that these buyers can now afford to buy less housing.The nexus between affordability and home availability illustrates a critical challenge in the housing market,highlighting the need for policies and strategies that increase supply and affordability.Nevertheless,mortgage rates are expected to drop later this year.As inflation decreases,moving closer to the 2%target,the Federal Reserve has already announced that it is likely appropriate to start cutting interest rates.Although this is not the rate that consumers pay,a lower rate for banks eventually makes borrowing less expensive for consumers as well.Will these lower rates help the housing market?There has already been much skepticism regarding the impact of reduced mortgage rates,especially since they are not anticipated to return to the near 3%levels seen in 2021.The current report examines how changes in mortgage rates affect the affordability and availability of affordable homes.While affordability is determined by the buyers income,the analysis explores the implications for each income group in detail.In summary,the analysis indicates that lower mortgage rates will create more affordable options for home buyers in every income group.Across income groups,buyers with an income of$125,000 stand to gain the most.Specifically,there will be about 43,000 additional listings that these buyers(earning$125,000)will afford to purchase if rates drop to 6.0%.Respectively,middle-income buyers(earning$75,000)will be able to afford about 33,100 additional listings.In the meantime,the gains from lower mortgage rates could be even larger as expected reductions in rates could encourage more homeowners to sell,thereby increasing the overall housing inventory available on the market.3Impact of mortgage rates versus home prices on mortgage paymentBefore analyzing the impact of lower mortgage rates,its essential to understand how both home prices and mortgage rates can change the monthly payment.Home prices and mortgage rates are the two main components that define a mortgage payment.The home price determines the principal amount borrowed,while the mortgage rate affects the interest paid on that principal.Thus,any changes in either of these factors substantially affect the overall monthly mortgage payment.However,data suggests that between these two factors home prices and mortgage rates-decreasing mortgage rates can more swiftly improve the affordability of homes compared to lowering house prices.With all other factors remaining constant,a one percentage point decrease in mortgage rates can reduce the monthly mortgage payment by$226 for the median-priced home.Conversely,the value of the median-price home would need to fall by 10 percent to achieve a comparable reduction in the monthly mortgage payment.Specifically,in current values,the price of the typical home would need to decrease by$39,000 to reach$345,500.With the Federal Reserve lowering its interest rates,mortgage rates could fall below 6 percent by the end of 2025.Nevertheless,home prices continue to increase due to limited inventory despite a slowdown in demand prompted by elevated mortgage rates.In the meantime,historically,its worth noting that declines in home price growth to such levels have only been observed following the Great Recession-during 2009.Monthly mortgage paymentfor the median-price homeCurrentlyScenario 1:Mortgage rates fall 1%,same priceScenario 2:Home prices fall 10%,same rate 4Home Price30-year fixed mortgage rateDown PaymentPayment$384,500 6.80.0%$2,256$384,500 5.80.0%$2,030$345,500 6.80.0%$2,030 Lower mortgage rates;additional affordable listings by income groupNationwideIn the current report,R,in collaboration with the National Association of REALTORS,quantifies the effect of expected lower mortgage rates.To do that,after computing the maximum affordable price,they estimated the number of listings that are affordable for each income group when rates are 6.8%(currently)versus a 6.0%rate.This decrease in mortgage rates 80 basis points allows for a considerable increase in the purchasing power of home buyers for each income group since they can afford to purchase more expensive homes.For instance,buyers earning$100,000 can afford to purchase a home valued at up to$327,460 at a 6.8%rate.Nevertheless,if the rate were to decrease to 6.0%,the same buyer could afford a home priced up to$348,070(6.3%more expensive).Here is a breakdown of the key findings:Data shows that buyers at all income levels will be able to afford a greater number of listings,thereby expanding their choices.The impact is more pronounced at certain income levels,particularly in the middle and upper-middle income brackets($75,000-$150,000).For higher income levels($150,000 and over),the percentage increase in affordability is smaller because they already have access to a majority of the housing market.In addition,higher income levels are usually less sensitive to rate changes.For the lowest income groups($15,000-$50,000),the increase in affordability is marginal.This suggests that even with lower rates,these buyers will have limited access to the market.Across each income group,buyers with an annual income of$125,000 will see the greatest advantage from this decrease in mortgage rates.These buyers can afford to purchase homes valued up to$435,090 when rates are at 6.0%,as opposed to a maximum home value of$409,330 at a rate of 6.8%.Buyers earning$125,000 will afford to buy 42,650 additional listings at a 6%rate.Middle-income buyers earning$75,000 will afford to buy 33,050 additional listings at a 6%rate.Even with lower mortgage rates,the market still lacks a significant number of affordable listings.In a balanced market,buyers earning$125,000 should be able to afford 72%of the listings.However,even with 6%rates,these buyers can afford only 55%of the listings.56Income6.8%mortgage rate6.0%mortgage rateNumber additional affordable listings(if rates drop from 6.8%to 6.0%)Balanced MarketShare of listings that households can afford to buyNumber of affordable listingsShare of listings that households can afford to buyNumber of affordable listingsShare of listings that households can afford to buyNumber of affordable listingsLess than$15,0001.0,662 1.2,794 2,132 8.7,425$25,000 2.7(,786 3.01,985 3,198 15.76,971$35,000 4.6I,043 5.4W,572 8,529 22.9$4,238$50,000 9.62,351 10.85,145 12,794 33.759,619$75,000 21.26,025 24.3%9,076 33,051 49.6R8,397$100,000 36.690,213 40.1B7,529 37,315 62.1f2,370$125,000 51.3T6,938 55.3X9,584 42,646 72.1v8,196$150,000 62.1f2,083 65.1i4,068 31,985 79.57,047$200,000 75.99,212 77.90,536 21,323 88.07,639$250,000 83.38,108 84.95,166 17,058 92.33,775$500,000 93.8%1,000,054 94.3%1,005,385 5,331 97.1%1,034,745$500,000 100.0%1,066,156 100.0%1,066,156 0100.0%1,066,156Top areas to benefit from lower mortgage rates7Housing costs,inventory,and income levels vary significantly by area due to various factors,including local economic conditions,demand and supply dynamics,regulatory environments,and geographical constraints.While these variations affect the affordability and availability of housing,its essential to examine local conditions to understand how buyers will benefit from lower mortgage rates at the local level.R,in collaboration with the National Association of REALTORS,produces monthly the REALTORS Affordability Distribution Curve and Score,which tracks affordability and availability of affordable listings since 2017 for the 100 largest metro areas and all the states(including the District of Columbia)across the United States.While this score lies between 0 and 2,the higher the score,the better the affordability.In addition,a score equal to 1 suggests that homes on the market are affordable to households in proportion to their income distribution.A score lower than 1 indicates low affordability,as there are not enough homes that people can afford to buy in this area.To estimate how buyers in different areas will benefit from lower mortgage rates,this report calculates the increase in affordability scores by area if rates drop to 6%.At the national level,the score increases by 5.9 percentage points to 0.68 from 0.64.Nevertheless,the data suggests that the following metro areas will see the most significant improvements in their affordability conditions,with over a 10%increase in their affordability score.This significant rise implies that a lower mortgage rate substantially enhances the share of affordable homes to buyers in these areas.Top areas to benefit from lower mortgage rates1.Spokane-Spokane Valley,WA,11.4%increase in affordability2.Lakeland-Winter Haven,FL11.0%increase in affordability3.Salt Lake City,UT10.8%increase in affordability4.Deltona-Daytona Beach,FL10.4%increase in affordability5.Fresno,CA10.2%increase in affordabilityLow affordability areas to benefit the most from lower mortgage rates8Based on the data,there is substantial variation in how much affordability improves from lower mortgage rates by area.However,it appears that lower mortgage rates could have a more significant impact in areas where affordability is already an issue.The average affordability score at a 6.8%rate for metro areas in the top quartile is approximately 0.47,compared to an average of 0.84 for those in the bottom quartile.Thus,the areas with the smallest benefit from lower mortgage rates are nearly twice as affordable as those that are poised to benefit the most.For instance,affordability will increase more than 9 percentage points in areas where the affordability score is lower than 0.45,such as Spokane,WA(11.4%),Riverside,CA(10.0%),Cape Coral-Fort Myers,FL(9.8%),Nashville,TN(9.7%),San Diego,CA(9.5%)and Los Angeles,CA(9.0%).In contrast,in metro areas with an affordability score near 1,such as Youngstown,OH(4.7%),Akron,OH(4.5%),Toledo,OH(4.1%),and Detroit,MI(4.0%),affordability is expected to increase less than 5 percentage points.An exception to this trend is seen in the San Francisco and San Jose metro areas,which,despite being among the most expensive,are expected to benefit the least from lower mortgage rates among the 100 largest metro areas,with less than a 4%increase in affordability.Limited supply-due to geographical constraints and zoning regulations-and less sensitivity to rate changes by high-income earners are both factors that contribute to reasons why these areas may not see benefits as significant as other comparably expensive regions.Higher down payments can also diminish the effects of lower mortgage rates in these expensive areas.9Areas in the top quartile:Average affordability score:0.47Areas in the bottom quartile:Average affordability score:0.84Score6.8%rateScore6.8%rateScore increaseScore increaseAreas with the most low-income buyers to benefit from lower mortgage rates10While lower mortgage rates benefit buyers across all income levels,the extent of these benefits varies by income group.R and the National Association of REALTORS computed how much the share of affordable listings increases by income group if rates drop from 6.8%to 6.0ross the 100 largest metro areas.At the national level,buyers in the lower income groups those earning less than$50,000-are expected to experience the smallest gains in affordable listings compared to other income groups.However,at the local level,some areas are about to see a greater increase in the share of affordable listings for these lower-income groups than for others.Specifically,in both Youngstown and Akron in Ohio,buyers in the low-income levels will benefit more than the other income groups.Should mortgage rates fall to 6%,these areas could see approximately a 3%increase in available listings within their affordability range.This is in contrast to a mere 1%rise on average in affordable listings for other income groups,indicating a more significant benefit for lower-income buyers in these areas.Thus,its reasonable to anticipate that buyers in the low-income groups will discover more opportunities in areas already known for their affordability.This dynamic could lead to a range of consequences for these markets,including potential shifts in demographics.Such markets might attract a more varied demographic,encompassing first-time homebuyers,young families,and individuals relocating from pricier regions.Take Akron,OH,as a case in point:over the past five years,the median age of home buyers in this area has decreased from 41 to 39,indicating a trend toward younger buyers entering the market.Top areas with the most low-income buyers(less than$50,000)to benefit from lower mortgage rates1.Youngstown-Warren et al,OH-PA2.Akron,OH3.Dayton-Kettering,OH4.Cleveland-Elyria,OH5.Toledo,OH11Share of affordable listings for the Top 15 Areas with the strongest gains from lower rates for buyers in the lower income groupsAreas with the most middle and upper-middle income buyers to benefit12While buyers in the middle and upper-middle income groups earning$75,000 to$150,000-are set to experience the largest increase in affordable listings compared to any other income group,these gains are even more pronounced in some areas across the country.Supply constraints,demand dynamics,and local income levels are some of the factors that contribute to this.Specifically,in the following five areas,the average increase in affordable listings for middle and upper-middle-income buyers is above 5%.For instance,in the Lakeland metro area in Florida,the share of affordable listings will rise 11.1%for buyers earning$100,000.This translates to about 654 additional listings that these buyers can afford to buy if rates drop to 6%.Top areas with the most middle-and upper-middle-income buyers to benefit from lower mortgage rates1.Lakeland-Winter Haven,FL2.Fresno,CA3.Spokane-Spokane Valley,WA4.Bakersfield,CA5.Deltona-Daytona Beach et al.,FL13Share of affordable listings for the Top 15 Areas with the strongest gains from lower rates for buyers in the middle-and upper-middle income groupsConclusion14The relationship between affordability and home availability is one of the housing markets main concerns,illustrating the delicate balance needed to ensure a healthy and accessible market.The analysis suggests that lower mortgage rates could benefit the housing market by increasing the number of affordable homes available to buyers across all income levels.Specifically,based on the findings,buyers in the middle-and upper-middle-income groups are expected to benefit the most from the anticipated drop in mortgage rates later this year.In some specific areas,these buyers will experience even more pronounced gains in the number of additional listings that will fall into their price range with lower mortgage rates.In addition,from homebuilders aspect,lower mortgage rates tend to create optimism among homebuilders,developing a favorable environment for home construction.At first,this is because increased purchasing power enables more people to afford homes,thereby stimulating market activity.Additionally,lower rates can improve the overall economic outlook,making financing easier to obtain and reducing costs,further incentivizing construction activity.However,simply reducing mortgage rates is insufficient to fully address the acute housing shortage that the current market faces.While lower mortgage rates can indeed make homes more affordable and consequently increase the pool of homes that buyers can purchase,they cannot address the root causes of low supply,such as zoning regulations and high construction costs.Looking AheadSolving the persistent housing shortage across our country requires a multifaceted approach that involves stakeholders at all levels,including governments,developers,and communities.The goal is to create a balanced and sustainable housing market that meets the demand needs of people at any income level,particularly those most in need of affordable options.Key components of this challenge include reforming local land use and zoning regulations to foster more development,expanding vocational training programs to ensure adequate labor supply,and actively promoting these initiatives.About RAbout RR makes buying,selling,renting and living in homes easier and more rewarding for everyone.R pioneered the world of digital real estate more than 25 years ago,and today through its website and mobile apps offers a marketplace where people can learn about their options,trust in the transparency of information provided to them,and get services and resources that are personalized to their needs.Using proprietary data science and machine learning technology,R pairs buyers and sellers with local agents in their market,helping take the guesswork out of buying and selling a home.For professionals,R is a trusted provider of consumer connections and branding solutions that help them succeed in todays on-demand world.R is operated by News Corp Nasdaq:NWS,NWSA ASX:NWS,NWSLV subsidiary Move,Inc.For more information,visit R.R.15The National Association of REALTORS is Americas largest trade association,representing more than 1.5 million members,including NARs institutes,societies and councils,involved in all aspects of the real estate industry.NAR membership includes brokers,salespeople,property managers,appraisers,counselors and others engaged in both residential and commercial real estate.The term REALTOR is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of REALTORS and subscribes to its strict Code of Ethics.Working for Americas property owners,the National Association provides a facility for professional development,research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system and the right to own real property.NATIONAL ASSOCIATION OF REALTORSNATIONAL ASSOCIATION OF REALTORSRESEARCH GROUPRESEARCH GROUPThe Mission of the NATIONAL ASSOCIATION OF REALTORS Research Group is to produce timely,data-driven market analysis and authoritative business intelligence to servemembers,and inform consumers,policymakers and the media in a professional and accessible manner.To find out about other products from NARs Research Group,visitnar.realtor/researchnar.realtor/research-andand-statisticsstatisticsNATIONAL ASSOCIATION OF REALTORSNATIONAL ASSOCIATION OF REALTORSResearch Group500 New Jersey Avenue,NWWashington,DC 20001202-383-1000datarealtors.orgdatarealtors.org 16
2024-11-21
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2024 Home Buyers and Sellers Generational Trends ReportNational Association of REALTORS Research Group2024 NAR Leadership TeamKevin Sears,AHWD,C2EXPresidentKevin Brown,AHWD,C2EXFirst Vice PresidentGregory J.Hrabcak,CCIM,C2EXTreasurerEric Sain,GRI,CIPS,C2EX,AHWD,ePROVice President of Association AffairsNate K.Johnson,AHWD,ABR,C2EX,CIPS,CRS,GRI,PSA,SRES Vice President of AdvocacyNykia WrightInterim Chief Executive Officer22024 NAR Home Buyers and Sellers Generational TrendsNAR Research Staff3Lawrence Yun,Ph.D.Chief Economist and Senior Vice PresidentJessica Lautz,Dr.of Real EstateDeputy Chief Economist and Vice President,Research Brandi SnowdenDirector,Member and Consumer Survey ResearchMeredith DunnResearch ManagerSidnee HolmesResearch AssociateAmethyst MarroquinResearch Assistant2024 NAR Home Buyers and Sellers Generational TrendsTable of Contents42024 Home Buyers and Sellers Generational Trends ReportIntroduction 5Chapter 1:Characteristics of Home Buyers 10Chapter 2:Characteristics of Homes Purchased 30Chapter 3:The Home Search Process 48Chapter 4:Home Buying and Real Estate Professionals 59Chapter 5:Financing the Home Purchase 77Chapter 6:Home Sellers and Their Selling Experience 94Chapter 7:Home Selling and Real Estate Professionals 121Methodology 1362024 NAR Home Buyers and Sellers Generational TrendsIntroduction52024 Home Buyers and Sellers Generational Trends ReportAGE OF HOME BUYERS&SELLERSSilent GenerationSilent Generation1925-1945Older BoomersOlder Boomers1946-1954Younger BoomersYounger Boomers1955-19641920Gen XGen X1965-1979Younger Gen Y/Younger Gen Y/MillennialsMillennials1990-1998Older Gen Y/Older Gen Y/Millennials:Millennials:1980-198962024 NAR Home Buyers and Sellers Generational Trends2023Gen ZGen Z1999 to 2011SHARE OF BUYERS AND SELLERS BY GENERATION72024 NAR Home Buyers and Sellers Generational Trends6&#%6%2%4$!%3%0%5 %0%Silent Generation:Older Boomers:Younger Boomers:Gen Xers:Older Gen Y/Millennials:Younger Gen Y/Millennials:Gen Zers:BuyersSellersIntroductionSince 2013,the National Association of REALTORS has produced the Home Buyers and Sellers Generational Trends Report.Home Buyers and Sellers Generational Trends Report.This report provides insights into the differences and similarities across generations of home buyers and sellers.The home buyer and seller data is taken from the annual Profile of Home Buyers and Sellers.This year,the share of Gen Z buyers and sellers Gen Z buyers and sellers aged 18 to 24 18 to 24 made up just three percent of buyers and two percent of sellers.While the share is consistent with last years report,the sample was too small to show unique characteristics.This group is entering homeownership with the lowest household incomes,and its members are unlikely to be married yet,and are not likely to have children under the age of 18 in their home.Similar to Young Millennials,they purchase older homes than other buyers.Millennial buyers aged 25 to 33 years(Younger Millennials)Millennial buyers aged 25 to 33 years(Younger Millennials)and buyers aged 34 to 43 years(Older Millennials)buyers aged 34 to 43 years(Older Millennials)make up the largest share of home buyers at 38 percent;Older Millennials at 21 percent,and Younger Millennials at 17 percent of the share of home buyers.Seventy-five percent of Younger Millennials and 44 percent of Older Millennials were first-time home buyers.Older Millennials had the highest share of married couples(66 percent),while Younger Millennials had the highest share of unmarried couples(19 percent)buying homes.Younger Millennials are the most educated group,with 80 percent holding at least a bachelors degree or higher.Twenty-four percent of Younger Millennials moved directly from a family members home before buying.Convenience to their job and commuting costs were both more important to buyers in this group.Buyers aged 44 to 58(Gen Xers)Buyers aged 44 to 58(Gen Xers)made up 4 percent of recent home buyers.This group remains one of the highest-earning home buyers,with a median income of$126,900 in 2023.With this extra income,buyers 44 to 58 purchased the second-largest homes at a median of 1,940 square feet.Fifty-eight percent of their recent home buyers are married couples,providing them with dual incomes.Gen X buyers were the most likely to purchase a multi-generational home at 19 percent and also were most likely to purchase a home for a job relocation or move.Buyers 44 to 58 years remain one of the most racially and ethnically diverse populations of home buyers,with 28 percent identifying they were a race other than white/Caucasian.For the report,buyers aged 59 to 68(Younger Baby Boomers)buyers aged 59 to 68(Younger Baby Boomers)and buyers aged 69 to 77(Older Baby Boomers)buyers aged 69 to 77(Older Baby Boomers)were broken into two separate categories as they have differing demographics and buying behaviors.Buyers 59 to 68 made up 19 percent of recent buyers and buyers 69 to 77 represented 12 percent of recent buyers.Baby Boomers purchased for an array of reasons:primarily,the desire to be closer to friends and family due to retirement,and the desire for a smaller home.Younger and Older Boomers were likelier than others to purchase in a small town,and Younger Boomers were the most likely to purchase in rural areas.Younger Boomers expect to own their homes for the longest period of time at 20 years,and Older Boomers purchased the newest homes on average.Buyers aged 59 to 68 typically moved the second furthest distance at a median of 50 miles,while buyers aged 69 to 77 moved a median of 49 miles.82024 NAR Home Buyers and Sellers Generational TrendsIntroductionBuyers aged 78 to 98(the Silent Generation)Buyers aged 78 to 98(the Silent Generation)represented one of the smallest shares of buyers at just four percent.As a large percentage of these buyers were likely to have retired from the workforce,they had the second lowest median household incomes and also purchased the second smallest homes at a median of 1,800 square feet.They typically purchase to be closer to friends and family.Buyers 78 to 98 were most likely to purchase in senior-related housing at 33 percent.They were also the second most likely to purchase new construction at 18 percent.They were more likely than others to choose a neighborhood based on convenience to health facilities.This age group also had the highest percentage of military veterans at 40 percent.Silent Generation buyers were least likely to make compromises on their purchased homes and also had the shortest search length at a median of six weeks.Buyers continue to finance their home purchasesBuyers continue to finance their home purchases,similar to years past.Eighty percent of home buyers financed their home purchasea share that decreases as the age of the buyer increases.Younger buyers continue to depend on savings for their downpayment,while older buyers use proceeds from the sale of their previous residence.Twenty-four percent of Younger Millennials received downpayment help in the form of a gift or a loan from a friend or relative.Older Millennials,Gen X,and Younger Boomer buyers purchases were delayed the longest due to debt at a median of five years.Buyers overall were delayed primarily by student loan debt and high rental costs,holding back savings.In fact,41 percent of Younger Millennials reported having student loan debt with a median loan balance of$30,000,compared to 35 percent of Older Millennials with a median of$40,000.While only 4 percent of Older Boomers had student loan debt,they had a median balance of$20,100.This may be due to not only their personal education loans,but also accumulating debt from their childrens education loans.It was most common for buyers to cut spending on luxury/non-essential items and entertainment to save for their home purchases.Baby Boomers make up the largest share of sellers Baby Boomers make up the largest share of sellers at 45 percent.Sellers aged 69 to 77 years were most likely to downsize their home.Baby Boomers and the Silent Generation are selling to move closer to friends and family or because their homes are too large,while Millennials are selling because their houses are too small or due to a change in family situation.Younger and Older Boomers typically owned their homes for 15 years before selling them.Real estate agents and brokers remain the top home buying and selling resource for all generations.Real estate agents and brokers remain the top home buying and selling resource for all generations.While the internet is being utilized throughout the home search,buyers continue to need the help of a real estate professional to help them find the right home,negotiate terms of sale,and help with price negotiations.Agents remain the most used information source in the home search,followed by mobile or tablet search devices.Sellers,as well,turned to professionals to price their homes competitively,help market their homes to potential buyers,sell within a specific timeframe,and find ways to fix up their homes to sell them for more.92024 NAR Home Buyers and Sellers Generational TrendsChapter 1Characteristics of Home Buyers102024 NAR Home Buyers and Sellers Generational TrendsCharacteristics of Home BuyersFirst-time buyers made up 32 percent of all home buyers,an increasefrom 26 percent last year.Seventy-five percent of Younger Millennialsand 54 percent of Gen Xers were first-time home buyers.Behindthese groups,44 percent of Older Millennials were also first-timehome buyers.At 38 percent,the combined share of Younger and Older Millennialsmade up the largest generational group of buyers.Gen X followedthem at 24 percent,with a median age of 51.Gen Xers had the second-highest household incomes of anygeneration,at$126,933 in 2023,just behind Older Millennials,with amedian household income of$127,700.Fifty-nine percent of recent buyers were married couples,19 percentwere single females,10 percent were single males,and nine percentwere unmarried couples.The highest percentage of single femalebuyers was among Gen Z at 31 percent.The highest share ofunmarried couples were Younger Millennials at 19 percent.Thirty percent of all buyers had children under the age of 18 living athome,and 65 percent of Older Millennials had at least one child underthe age of 18.Fourteen percent of home buyers purchased a multi-generationalhome to take care of and spend time with aging parents becausechildren over the age of 18 were moving back,and for cost savings.Nineteen percent of Gen Xers purchased a multi-generational home.Younger Boomers comprised the second largest share at 16 percent.Older Millennials and Gen Xers remain two of the most racially diversegroups of buyers in 2023.Thirty percent of Older Millennials and 28percent percent of Gen X buyers identified as Hispanic/Latino,Black/African American,Asian/Pacific Islander,or Other.Younger Millennials are the most educated group,with 80 percentholding at least a bachelors degree or higher.The next mosteducated group was Older Millennials.The most common reasons for recently purchasing a home vary bygeneration.For all home buyers under the age of 59,the main reasonfor purchasing remains the desire to own a home of their own.Among the 59-and older age groups,the desire to be closer to friendsand family was the top reason to purchase,followed by the desire fora smaller home.112024 NAR Home Buyers and Sellers Generational TrendsCharacteristics of Home Buyers122024 NAR Home Buyers and Sellers Generational TrendsExhibit 1-1AGE OF HOME BUYERSExhibit 1-2HOUSEHOLD INCOME OF HOME BUYERSExhibit 1-3ADULT COMPOSITION OF HOME BUYER HOUSEHOLDSExhibit 1-4NUMBER OF CHILDREN UNDER THE AGE OF 18 RESIDING IN HOUSEHOLDExhibit 1-5HOME PURCHASED WAS A MULTI-GENERATIONAL HOME(WILL HOME ADULT SIBLINGS,ADULT CHILDREN,PARENTS,AND/OR GRANDPARENTS)Exhibit 1-6HOME BUYER IDENTIFIES AS TRANSGENDERExhibit 1-7HOME BUYER SEXUAL ORIENTATIONExhibit 1-8RACE/ETHNICITY OF HOME BUYERSExhibit 1-9HOME BUYER EDUCATIONExhibit 1-10PRIMARY LANGUAGE SPOKEN IN HOME BUYER HOUSEHOLDExhibit 1-11NATIONAL ORIGIN OF HOME BUYERSExhibit 1-12SELF OR SPOUSE/PARTNER IS ACTIVE MILITARY OR VETERANExhibit 1-13FIRST-TIME HOME BUYERS IN AGE GROUPExhibit 1-14PRIOR LIVING ARRANGEMENTExhibit 1-15PRIMARY REASON FOR PURCHASING A HOMEExhibit 1-16PRIMARY REASON FOR THE TIMING OF HOME PURCHASEExhibit 1-17OTHER HOMES OWNEDAGE OF HOME BUYERS2024 NAR Home Buyers and Sellers Generational Trends13Exhibit 1-1(Percentage Distribution)Median Age in Group21303851647281Note:Buyers 18 to 24 years only made up only three percent of the share of all buyers.They were not included in chapters 1 through 5 on home buyers due to the low number of responses for analysis.4$!%3%5 %0%Silent Generation:78 to 98 yearsOlder Boomers:69 to 77 yearsYounger Boomers:59 to 68 yearsGen Xers:44 to 58 yearsOlder Gen Y/Millennials:34 to 43 yearsYounger Gen Y/Millennials:25 to 33 yearsGen Zers:18 to 24 yearsHOUSEHOLD INCOME OF HOME BUYERS 2024 NAR Home Buyers and Sellers Generational Trends14Exhibit 1-2(Percentage Distribution)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Less than$25,0002%5%1%2%2%5%4%2%$25,000 to$34,99935213566$35,000 to$44,999412333567$45,000 to$54,9997126458139$55,000 to$64,9996117557811$65,000 to$74,999677556712$75,000 to$84,99975767877$85,000 to$99,99999139710810$100,000 to$124,9991519171614141513$125,000 to$149,99995101011868$150,000 to$174,99981999864$175,000 to$199,9995*567541$200,000 or more169122422131010Median income(2022)$107,000$72,300$106,000$127,700$126,900$104,400$82,700$78,500 ADULT COMPOSITION OF HOME BUYER HOUSEHOLDS 2024 NAR Home Buyers and Sellers Generational Trends15Exhibit 1-3(Percentage Distribution)592TfXaaa1!%# %8%9%9%9%8%5%3%2%3%3%2%2%3%3%3%3%0 %All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Married coupleSingle femaleSingle maleUnmarried coupleOtherNUMBER OF CHILDREN UNDER THE AGE OF 18 RESIDING IN HOUSEHOLD 2024 NAR Home Buyers and Sellers Generational Trends16Exhibit 1-4(Percentage Distribution of Households)*Less than 1 percent70d5f%7!%3%2%1%2(%2%1%0%5%3%7%5%1%0%0%0 0%All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98NoneOneTwoThree or moreHOME PURCHASED WAS A MULTI-GENERATIONAL HOME(WILL HOME ADULT SIBLINGS,ADULT CHILDREN,PARENTS,AND/OR GRANDPARENTS)2024 NAR Home Buyers and Sellers Generational Trends17Exhibit 1-5(Percent of Respondents)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Multi-generational household14%9%Reasons for purchase:Health/Caretaking of aging parents2723&%Children/relatives over 18 moving back into the house199132620226Cost Savings2239292213819To spend more time with aging parents1925341914419Children/relatives over 18 never left home1357191710*Wanted a larger home that multiple incomes could afford together11191381012*Other19161012253650None of the above 77848173*Less than 1 percentHOME BUYER IDENTIFIES AS TRANSGENDER2024 NAR Home Buyers and Sellers Generational Trends18Exhibit 1-6(Percentage Distribution)*Less than 1 percent*3%*98%1%*1%1%1%*0 0%All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Identify as transgenderDo not identify as transgenderPrefer not to answerHOME BUYER SEXUAL ORIENTATION 2024 NAR Home Buyers and Sellers Generational Trends19Exhibit 1-7(Percentage Distribution)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Heterosexual or straight88%Gay or lesbian3535331*Bisexual23622*Prefer to self-describe11211*Prefer not to answer68546676*Less than 1 percentRACE/ETHNICITY OF HOME BUYERS 2024 NAR Home Buyers and Sellers Generational Trends20Exhibit 1-8(Percent of Respondents)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98White/Caucasian81yuv%Hispanic/Latino751189623Asian/Pacific Islander769105321Black/African-American68589632Other65345321Note:Respondents were permitted to select as many races and ethnicities as they felt applicable.The percentage distribution may therefore sum to more than 100 percent.*Less than 1 percentHOME BUYER EDUCATION2024 NAR Home Buyers and Sellers Generational Trends21Exhibit 1-9(Percentage Distribution)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Less than high school1%4%1%*1%1%1%1%High school diploma162291316221716Associates degree13179815161718Bachelors degree3137383130292520Some graduate work7455781014Masters degree/MBA/law degree2613303326192321Doctoral degree7371066710*Less than 1 percentPRIMARY LANGUAGE SPOKEN IN HOME BUYER HOUSEHOLD 2024 NAR Home Buyers and Sellers Generational Trends22Exhibit 1-10(Percentage Distribution)94%6%6%7%9%6%3%2%3%0 0%All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98EnglishOtherNATIONAL ORIGIN OF HOME BUYERS 2024 NAR Home Buyers and Sellers Generational Trends23Exhibit 1-11(Percentage Distribution)90%8%8%7%4%0 0%All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Born in U.S.Not born in U.S.ACTIVE MILITARY/VETERANS2024 NAR Home Buyers and Sellers Generational Trends24Exhibit 1-12(Percentage Distribution)*Less than 1 percent2%3%4%4%1%*16%9%6 (r%0 0%All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Active in the Armed ForcesVeteranNeitherFIRST-TIME HOME BUYERS IN AGE GROUP 2024 NAR Home Buyers and Sellers Generational Trends25Exhibit 1-13(Percentage Distribution)32uD$%8%4%3%0 %All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98PRIOR LIVING ARRANGEMENT 2024 NAR Home Buyers and Sellers Generational Trends26Exhibit 1-14(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Owned previous home51 Ri%Rented an apartment or house36554636231111Lived with parents/relatives/friends,paid rent61366342Lived with parents/relatives/friends,did not pay rent61164432Rented the home ultimately purchased11121*Note:After selling their previous home,buyers may have rented a home or apartment before purchasing their next home.A first-time buyer could have acquired ownership of their previous home(as an inheritance or gift,for example)without having been the buyer of the home.Thus,a first-time buyer could have owned a home prior to their first home purchase.*Less than 1 percentPRIMARY REASON FOR PURCHASING A HOME 2024 NAR Home Buyers and Sellers Generational Trends27Exhibit 1-15(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Desire to own a home of my own26I5&%5Mesire to be closer to family/friends/relatives12458183128Retirement5*215116Desire for a home in a better area1377887Desire for smaller home6*14101420Desire for larger home11102012673Change in family situation(e.g.marriage,birth of child,divorce,etc.)88811875Job-related relocation or move6689311Desire to be closer to job/school/transit32332*1Affordability of homes2212223Establish a household2631*Financial security2321211Better weather conditions1*1211*Desire for better home for pet(s)1211112Desire for a newly built or custom-built home2*12223Purchased home for family member or relative1*21*Greater number of homes on the market for sale/better choice*Less than 1 percentPRIMARY REASON FOR THE TIMING OF HOME PURCHASE 2024 NAR Home Buyers and Sellers Generational Trends28Exhibit 1-16(Percentage Distribution)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98It was just the right time,was ready to buy a home43AREACC5%Did not have much choice,had to purchase2424242627201619It was the best time because of mortgage financing options available56555447It was the best time because of availability of homes for sale11157911151413It was the best time because of affordability of homes45544366The buyer wished they had waited31233332Other1085910121417OTHER HOMES OWNED 2024 NAR Home Buyers and Sellers Generational Trends29Exhibit 1-17(Percent of Respondents)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Recently purchased home only83yys%One or more investment properties86999810Previous homes that buyer is trying to sell2112346One or more vacation homes3*13677Other2122221Chapter 2Characteristics of Homes Purchased 302024 NAR Home Buyers and Sellers Generational TrendsCharacteristics of Homes Purchased Buyers of new homes again made up a 13 percent share and buyers of previously owned homes made up 87 percent.Nineteen percent of Older Boomers bought new homes,compared to only ten percent of Younger and Older Millennials.At 45 percent,most recent buyers who purchased new homes were looking to avoid renovations and problems with plumbing or electricity.Buyers who purchased previously owned homes were most often considering a better price at 36 percent.Younger Boomers were more likely to purchase a new home to avoid renovations and problems with plumbing or electricity.The most common type of home purchase continued to be detached single-family homes,which made up 79 percent of all homes purchased.Although this was most common among all generations,the Silent Generation continued to purchase apartments/condos at higher shares than other age groups.Senior-related housing accounted for nineteen percent of buyers over the age of 60;that number was twenty-four percent for Older Baby Boomers and 33 percent for the Silent Generation.The median distance between the homes that recent buyers previously resided in and the homes that they purchased was only 20 miles,down significantly from 50 miles last year.The median distance moved was highest among the Silent Generation at 63 miles,while the lowest was among Older Millennials at 12 miles.The typical home recently purchased was 1,860 square feet,had three bedrooms and two bathrooms,and was built in 1985.The size of homes for Gen Xers was typically larger at 1,940 square feet,compared to Younger Millennials at a median of 1,700.Older Baby Boomers typically purchased some of the newest homes,with the typical home being built in 1994.Heating and cooling costs and windows/doors/siding were the most important environmental features for recent home buyers,with 33 and 31 percent finding these two features very important,respectively.Younger Millennials consider commuting costs most important at 41 percent.Overall,buyers expected to live in their homes for a median of 15 years,the same as last year.For Younger Millennials and Gen Z,the expected length of time was only 10 years compared to 20 years for Younger Baby Boomers.312024 NAR Home Buyers and Sellers Generational TrendsCharacteristics of Homes Purchased 322024 NAR Home Buyers and Sellers Generational TrendsExhibit 2-1 NEW AND PREVIOUSLY OWNED HOMES PURCHASEDExhibit 2-2 WHY NEW AND PREVIOUSLY OWNED HOMES PURCHASEDExhibit 2-3 TYPE OF HOME PURCHASEDExhibit 2-4 LOCATION OF HOME PURCHASEDExhibit 2-5 SENIOR-RELATED HOUSING BY TYPE OF HOME PURCHASED AND LOCATIONExhibit 2-6 DISTANCE BETWEEN HOME PURCHASED AND PREVIOUS RESIDENCEExhibit 2-7 FACTORS INFLUENCING NEIGHBORHOOD CHOICEExhibit 2-8 PURCHASE PRICE COMPARED WITH ASKING PRICEExhibit 2-9 SIZE OF HOME PURCHASEDExhibit 2-10 NUMBER OF BEDROOMS AND BATHROOMSExhibit 2-11 YEAR HOME BUILTExhibit 2-12 ENVIRONMENTALLY FRIENDLY FEATURES CONSIDERED VERY IMPORTANTExhibit 2-13 CHARACTERISTICS OF HOME ON WHICH BUYER COMPROMISEDExhibit 2-14 EXPECTED LENGTH OF TENURE IN HOME PURCHASEDExhibit 2-15 FACTORS THAT COULD CAUSE BUYER TO MOVENEW AND PREVIOUSLY OWNED HOMES PURCHASED 2024 NAR Home Buyers and Sellers Generational Trends33Exhibit 2-1(Percentage Distribution)13%0 0%All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98NewPreviously OwnedWHY NEW AND PREVIOUSLY OWNED HOMES PURCHASED 2024 NAR Home Buyers and Sellers Generational Trends34Exhibit 2-2(Percent of Respondents)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98New Home:Avoid renovations or problems with plumbing or electricity45SUBC0 ility to choose and customize design features26222129182540Amenities of new home construction communities26242724222910Lack of inventory of previously owned homes1327242314820Green/energy efficiency19212311757Smart home features131715119710Other20202420162213Previously Owned Home:Better overall value38873541tter price36534336262520More charm and character23232626221921Lack of inventory of new homes182224161199Want to DIY a fixer upper71176544Other104611161823*Less than 1 percentTYPE OF HOME PURCHASED 2024 NAR Home Buyers and Sellers Generational Trends35Exhibit 2-3(Percentage Distribution)*Less than 1 percent79hwqe%2%4%1%2%3%3%4%3%2%1%2%2%2%2%1%3%8%9%8%7%8%8%4%3%3%2%3%5%7%1%4%1%1%1%1%3%5%4%8%3%2%3%4%4%6%0 0%All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Detached single-family homeMobile/manufactured homeCabin/cottageTownhouse/rowhouseDuplex/apartment/condo in 2 to 4 unit bldgApartment/condo in building with 5 unitsOtherLOCATION OF HOME PURCHASED 2024 NAR Home Buyers and Sellers Generational Trends36Exhibit 2-4(Percentage Distribution)*Less than 1 percent47IPFDHH#!$#%2%*1%2%5%3%0 %All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Suburb/SubdivisionSmall townUrban area/Central cityRural areaResort/Recreation areaSENIOR-RELATED HOUSING BY TYPE OF HOME PURCHASED AND LOCATION 2024 NAR Home Buyers and Sellers Generational Trends37Exhibit 2-5(Percentage Distribution)AGE OF HOME BUYERAll buyers over 6059 to 6869 to 7778 to 98Share who purchased a home in senior-related housing19$3%Buyers over 50 who purchased senior-related housing:Type of home purchasedDetached single-family home59eWQ%Duplex/apartment/condo in 2-to-4-unit building1281414Townhouse/row house1217910Apartment/condo in building with 5 or more units52510Other1281414LocationSuburb/Subdivision53VRE%Small town19212015Rural area1314721Resort/Recreation area841013Urban/Central city86116DISTANCE BETWEEN HOME PURCHASED AND PREVIOUS RESIDENCE 2024 NAR Home Buyers and Sellers Generational Trends38Exhibit 2-6(Median Miles)2025131220504963020406080All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98FACTORS INFLUENCING NEIGHBORHOOD CHOICE 2024 NAR Home Buyers and Sellers Generational Trends39Exhibit 2-7(Percent of Respondents)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Quality of the neighborhood609ddYXe%Convenient to friends/family4555534235495658Overall affordability of homes3944554334333428Convenient to job38526253442157Availability of larger lots or acreage281321242219119Convenient to shopping2621262723292923Design of neighborhood2315293021231811Convenient to vet/outdoor space for pet2217281816171412Convenient to parks/recreational facilities2015293021231811Walkability1919242017232016Convenient to schools1912233917421Convenient to entertainment/leisure activities1919302420232014Quality of the school district1815273716731Convenient to health facilities16139810263638Access to bike paths91110991072Convenient to airport8681091197Home in a planned community86666111317Convenient to public transportation64886423Other765381078*Less than 1 percentPURCHASE PRICE COMPARED WITH ASKING PRICE 2024 NAR Home Buyers and Sellers Generational Trends40Exhibit 2-8(Percentage Distribution)AGE OF HOME BUYERPercent of asking price:All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Less than 90%8%9%6%6%9%9%8%to 941191012910995%to 9931282626282820100127252830323636101%to 110 15272419171320More than 110W553453Median(purchase price as a percent of asking price)100000000%SIZE OF HOME PURCHASED 2024 NAR Home Buyers and Sellers Generational Trends41Exhibit 2-9(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 981,000 sq ft or less1%1%1%1%1%1%*1,001 to 1,500 sq ft151913131516191,501 to 2,000 sq ft283324272930312,001 to 2,500 sq ft262524242627252,501 to 3,000 sq ft131115121414143,001 to 3,500 sq ft9611118763,501 sq ft or more951212767Median(sq ft)1,8601,7001,9701,9401,8301,8001,800NUMBER OF BEDROOMS AND BATHROOMS 2024 NAR Home Buyers and Sellers Generational Trends42Exhibit 2-10(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98One bedroom1%1%*1%1%2%1%1%Two bedrooms1630131012212837Three bedrooms or more8370879087787162Median number of bedrooms33333333One full bathroom180%Two full bathrooms5962575557606774Three full bathrooms or more238162827232015Median number of full bathrooms22222222YEAR HOME BUILT 2024 NAR Home Buyers and Sellers Generational Trends43Exhibit 2-11(Median)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 9820232%*2%2%2%1%1%2 224453322021 through 2016755678882015 through 20105144657132009 through 2004978871212162003 through 198820241718212026231987 through 196228342830252926241961 through 191920182821211814101918 and older410665422Median 19851979197819831986198719941997ENVIRONMENTALLY FRIENDLY FEATURES CONSIDERED“VERY IMPORTANT”2024 NAR Home Buyers and Sellers Generational Trends44Exhibit 2-12(Percent of Respondents)3314732 11%(530019A84 &$#%& #&$#!%8%6%9%4%6%5%5%4%7%0E%All Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Heating and cooling costsWindows/Doors/Siding(Installation)Commuting CostsEnergy efficient lightingEnergy efficient appliancesLandscaping for energy conservationEnvironmentally friendly community featuresSolar panels installed on homeCHARACTERISTICS OF HOME ON WHICH BUYER COMPROMISED 2024 NAR Home Buyers and Sellers Generational Trends45Exhibit 2-13(Percent of Respondents)*Less than 1 percentAGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Price of home33097)(&%Condition of home2624313025212119Size of home2325272520212017Style of home1917242216181512Lot size152318171515129Distance from friends or family10101512810810Distance from job1323231913711Quality of the neighborhood81311757511Quality of the schools547741*Distance from school22242*1None-Made no compromises2626141831303744Other compromises not listed846891195EXPECTED LENGTH OF TENURE IN HOME PURCHASED 2024 NAR Home Buyers and Sellers Generational Trends46Exhibit 2-14(Percentage Distribution)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 981 year or less2%4%1%2%1%2%1%9%2 to 3 years577544344 to 5 years132422141198126 to 7 years426542148 to 10 years222527212119273511 to 15 years896797141116 or more years4527304749564322Dont Know12*1133Median1510101515201510*Less than 1 percentFACTORS THAT COULD CAUSE BUYER TO MOVE 2024 NAR Home Buyers and Sellers Generational Trends47Exhibit 2-15(Percentage Distribution)AGE OF HOME BUYERAll Buyers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Move with life changes(addition to family,marriage,children move out,retirement,etc.)40EYRB0 %Never moving-forever home2223121823253332Household members health18125814313647Move with job or career change263146422861*Want nicer home/added features2128423416972Want a larger home2038523110441Downsize/smaller house15861620201111May desire better area/neighborhood18173127151165Unfit living conditions due to environmental factors116131491264Will flip home36732211Other755581068Chapter 3The Home Search Process 482024 NAR Home Buyers and Sellers Generational TrendsThe Home Search ProcessAmong all generations of home buyers,the first step taken in the home search process was to look online for properties.The Silent Generation contacted a real estate agent as a first step more often than other generations.Buyers typically searched for 10 weeks and looked at a median of seven homes.The length of the home search was the longest for Gen Xers,at 11 weeks,and shortest for the Silent Generation,at just six weeks.Older Millennials and Gen Xers viewed the most homes,with a median of eight homes.For more than half of home buyers,the most difficult step in the home buying process was finding the right property at 59 percent.This was even higher for Younger Millennials at 64 percent.Photos were the most useful website feature for nearly nine in 10 buyers aged 58 and under.Detailed information about properties for sale was also very important to all age groups.When asked where they conducted their internet searches,home buyers were split;they typically conducted 50 percent of their searches on a desktop or laptop and 50 percent on a mobile device(s).Those aged 43 and younger were more likely to use mobile devices,and those 59 and older were more likely to use a desktop or laptop.Buyers of all generations were overall very satisfied with their home buying process.Buyer satisfaction generally increases with age.492024 NAR Home Buyers and Sellers Generational TrendsThe Home Search Process502024 NAR Home Buyers and Sellers Generational TrendsExhibit 3-1 FIRST STEP TAKEN DURING THE HOME BUYING PROCESSExhibit 3-2 INFORMATION SOURCES USED IN HOME SEARCHExhibit 3-3 LENGTH OF SEARCHExhibit 3-4 WHERE BUYER FOUND THE HOME THEY PURCHASEDExhibit 3-5 MOST DIFFICULT STEPS OF HOME BUYING PROCESSExhibit 3-6 VALUE OF WEBSITE FEATURESExhibit 3-7 MOBILE SEARCH Exhibit 3-8 SATISFACTION IN BUYING PROCESSFIRST STEP TAKEN DURING THE HOME BUYING PROCESS 2024 NAR Home Buyers and Sellers Generational Trends51Exhibit 3-1(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Looked online for properties for sale414FGA1%Contacted a real estate agent 20141919222234Looked online for information about the home buying process1118127782Contacted a bank or mortgage lender89910654Talked with a friend or relative about home buying process714944311Drove-by homes/neighborhoods4333465Visited open houses3223242Contacted builder/visited builder models2122231Contacted a home seller directly2112244Looked up information about different neighborhoods or areas(schools,local lifestyle/nightlife,parks,public transportation211*Attended a home buying seminar1122112Looked in newspapers,magazines,or home buying guides*1Read books or guides about the home buying process*11*1Other11*1211INFORMATION SOURCES USED IN HOME SEARCH 2024 NAR Home Buyers and Sellers Generational Trends52Exhibit 3-2(Percent of Respondents)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Real estate agent88%Mobile or tablet search device72838375655642Open house50505753474346Online video site38263241484743Yard sign 33323435323334Home builder17131618172024Print newspaper advertisement6555689Home book or magazine5346695Billboard4345342Relocation company23332*1Television3332321*Less than 1 percentLENGTH OF SEARCH 2024 NAR Home Buyers and Sellers Generational Trends53Exhibit 3-3(Medians)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Number of Weeks Searched109101110106Number of Weeks Searched Before Contacting an Agent2233321Number of homes viewed7788775*Less than 1 percentWHERE BUYER FOUND THE HOME THEY PURCHASED 2024 NAR Home Buyers and Sellers Generational Trends54Exhibit 3-4(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Internet52PF64!%Real estate agent28434334Yard sign/open house sign4324554Friend,relative or neighbor8202428303645Home builder or their agent677691113Directly from sellers/Knew the sellers310111313103Print newspaper advertisement*335577Home book or magazine*333213Other*MOST DIFFICULT STEPS OF HOME BUYING PROCESS 2024 NAR Home Buyers and Sellers Generational Trends55Exhibit 3-5(Percent of Respondents)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Finding the right property59dbXUVc%Paperwork18232016141715Understanding the process and steps17322114977Saving for the down payment1738241251*Getting a mortgage810129654Appraisal of the property5665441No difficult steps1771018242427Other6688563*Less than 1 percentVALUE OF WEBSITE FEATURES 2024 NAR Home Buyers and Sellers Generational Trends56Exhibit 3-6(Percentage Ranking Feature Very Useful Among Buyers Who Used the Internet)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Photos66858884817358Detailed information about properties for sale65798081777564Floor plans47586059575446Real estate agent contact information43393844525454Virtual tours33414545423332Neighborhood information32374337343128Pending sales/contract status30414438352920Detailed information about recently sold properties28404141383124Interactive maps22394235292016Videos21293228292017Information about upcoming open houses19263127202010Virtual listing appointment9111412864Virtual open houses910131311108Real estate news or articles6%9%8%6%5%5%4%PERCENTAGE OF TIME USING DEVICES IN HOME SEARCH 2024 NAR Home Buyers and Sellers Generational Trends57Exhibit 3-7(Percent of Respondents Among those Who Used the Internet to Search)*Less than 1 percent500PuPppPP20 0%All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Desktop/LaptopMobile Device(s)SATISFACTION IN BUYING PROCESS 2024 NAR Home Buyers and Sellers Generational Trends58Exhibit 3-8(Percentage Distribution)56RPYcp6A203&%6%6%8%6%4%5%2%2%2%2%2%3%2%1%0 %All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Very SatisfiedSomewhat SatisfiedSomewhat DissatisfiedVery DissatisfiedChapter 4Home Buying and Real Estate Professionals592024 NAR Home Buyers and Sellers Generational TrendsHome Buying and Real Estate ProfessionalsEighty-nine percent of all buyers purchased their homes through an agent,as did 91 percent of Younger Millennials and 90 percent of Older Millennials.Buyers from all generations primarily wanted their agents help to find the right home to purchase at 50 percent.Buyers were also looking for help negotiating the terms of the sale and price negotiations.Younger Millennials were more likely to want their agent to help with paperwork.Helping the buyer understand the purchase process was most beneficial to Millennial buyers:Younger Millennials at 82 percent and Older Millennials at 69 percent.Referrals remain the primary method most buyers find their real estate agent.Referrals by friends,neighbors,or relatives were higher among Younger Millennial buyers(53 percent)and Older Millennial Buyers(45 percent)compared to older generations.Older buyers were more likely to work with an agent they had previously used to buy or sell a home.When choosing an agent to work with,working with an agent that was honest and trustworthy was the most important factor for buyers,followed by one with experience.An agents reputation was slightly more important to older generations as compared to younger generations.Seventy-one percent of buyers interviewed only one real estate agent during their home search.Seventy-five percent would use their agent again or recommend their agent to others,also consistent across all generations.602024 NAR Home Buyers and Sellers Generational TrendsHome Buying and Real Estate Professionals612024 NAR Home Buyers and Sellers Generational TrendsExhibit 4-1 METHOD OF HOME PURCHASEExhibit 4-2 AGENT REPRESENTATION DISCLOSUREExhibit 4-3 BUYER REPRESENTATIVE ARRANGEMENT WITH AGENTExhibit 4-4 HOW REAL ESTATE AGENT WAS COMPENSATEDExhibit 4-5 WHAT BUYERS WANT MOST FROM REAL ESTATE AGENTSExhibit 4-6 BENEFITS PROVIDED BY REAL ESTATE AGENT DURING HOME PURCHASE PROCESSExhibit 4-7 HOW BUYER FOUND REAL ESTATE AGENTExhibit 4-8 HOW MANY TIMES CONTACTED AGENT BEFORE RECEIVED RESPONSE AND ORIGINAL FORM OF CONTACTExhibit 4-9 NUMBER OF REAL ESTATE AGENTS INTERVIEWEDExhibit 4-10 MOST IMPORTANT FACTORS WHEN CHOOSING AN AGENTExhibit 4-11 AGENT SKILLS AND QUALITIES CONSIDERED VERY IMPORTANTExhibit 4-12 IMPORTANCE OF AGENT COMMUNICATIONSExhibit 4-13 SATISFACTION WITH REAL ESTATE AGENT SKILLS AND QUALITIESExhibit 4-14 WOULD BUYER USE REAL ESTATE AGENT AGAIN OR RECOMMEND TO OTHERSExhibit 4-15 HOW MANY TIMES BUYER RECOMMENDED AGENTMETHOD OF HOME PURCHASE 2024 NAR Home Buyers and Sellers Generational Trends62Exhibit 4-1(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Through a real estate agent or broker89%Directly from builder or builders agent5445597Directly from the previous owner6665648Knew previous owner4443423Did not know previous owner2222225AGENT REPRESENTATION DISCLOSURE 2024 NAR Home Buyers and Sellers Generational Trends63Exhibit 4-2(Percentage Distribution)AGE OF HOME BUYERDisclosure Statement SignedAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Yes,at first meeting25$)%Yes,when contract was written22222323212025Yes,at some other time129111512128No20242119202227Dont know21292319171721BUYER REPRESENTATIVE ARRANGEMENT WITH AGENT 2024 NAR Home Buyers and Sellers Generational Trends64Exhibit 4-3(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Yes,a written arrangement417FE5$%Yes,an oral arrangement17161617152224No26232625293240Dont know16241813111112HOW REAL ESTATE AGENT WAS COMPENSATED2024 NAR Home Buyers and Sellers Generational Trends65Exhibit 4-4(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Paid by seller52QSPSPG%Paid by buyer and seller1210911141313Paid by buyer only25202425243129Percent of sales price76687774788274Flat fee4434359Per task fee*1*Other1111212Dont know19271921171215Other1122211Dont know111810116510*Less than 1 percentWHAT BUYERS WANT MOST FROM REAL ESTATE AGENTS 2024 NAR Home Buyers and Sellers Generational Trends66Exhibit 4-5(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Help find the right home to purchase50HEQQUb%Help buyer negotiate the terms of sale12151411141011Help with the price negotiations1111141310115Help with paperwork7867777Determine what comparable homes were selling for7576699Help determining how much home buyer can afford4565422Help find and arrange financing3433322Help teach buyer more about neighborhood or area(restaurants,parks,public transportation)3122111Help find renters for buyers property*Other3333331*Less than 1 percentBENEFITS PROVIDED BY REAL ESTATE AGENT DURING HOME PURCHASE PROCESS 2024 NAR Home Buyers and Sellers Generational Trends67Exhibit 4-6(Percent of Respondents)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Helped buyer understand the process61iVHGB%Pointed out unnoticed features/faults with property58666052575147Negotiated better sales contract terms46575243383738Provided a better list of service providers(e.g.home inspector)46514941404745Improved buyers knowledge of search areas45524742434042Negotiated a better price33393732282830Shortened buyers home search29342825292933Provided better list of mortgage lenders23332721171312Expanded buyers search area21211921212120Narrowed buyers search area16161813151718None of the above64591066Other2122232HOW BUYER FOUND REAL ESTATE AGENT 2024 NAR Home Buyers and Sellers Generational Trends68Exhibit 4-7(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Referred by(or is)a friend,neighbor or relative43SE97BB%Used agent previously to buy or sell a home1371215141517Inquired about specific property viewed online75571073Website(without a specific reference)7787774Referred by another real estate agent/broker5575644Saw contact information on For Sale/Open House sign5646577Visited an open house and met agent5455574Personal contact by agent(telephone,e-mail,etc.)3223456Referred through employer or relocation company23231*2Walked into or called office and agent was on duty1*1136Saw the agents social media page without a connection1111112Mobile or tablet application11111*1Crowdsourcing through social media/knew the person through social media1111*Direct mail(newsletter,flyer,postcard,etc.)*1*1Newspaper,Yellow Pages or home book ad*1Advertising specialty(calendar,magnet,etc.)*1Other6476521HOW MANY TIMES CONTACTED AGENT BEFORE RECEIVED RESPONSE AND ORIGINAL FORM OF CONTACT 2024 NAR Home Buyers and Sellers Generational Trends69Exhibit 4-8(Median,Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Phone call26 (344%Talked to them in person20161721232629E-mail912118766Ask a friend to put me in touch18202115151923Inquiry for more information through 3rd party website121712131183Text message810129522Through agents website4232352Social Media(FaceBook,Twitter,LinkedIn,etc.)4643311Number of Times Contacted(median)1111111NUMBER OF REAL ESTATE AGENTS INTERVIEWED 2024 NAR Home Buyers and Sellers Generational Trends70Exhibit 4-9(Percentage Distribution)71hiqrsr! %7%8%7%8%8%6%9%4%4%4%4%5%5%4%0 %All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98OneTwoThreeFour or moreMOST IMPORTANT FACTORS WHEN CHOOSING AN AGENT 2024 NAR Home Buyers and Sellers Generational Trends71Exhibit 4-10(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Agent is honest and trustworthy19$%Agents experience21222322221717Reputation of agent15131612151919Agent is friend or family member1214121411914Agents knowledge of the neighborhood956771312Agent has caring personality/good listener87798106Agent is timely with responses6568745Agent seems 100cessible because of use of technology like tablet or smart phone4223558Agents association with a particular firm1111223Active in local community/volunteerism1111111Professional designations held by agent*1*1*Other 4434443AGENT SKILLS AND QUALITIES CONSIDERED VERY IMPORTANT 2024 NAR Home Buyers and Sellers Generational Trends72Exhibit 4-11(Percent of Respondents)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Honesty and integrity98%Knowledge of purchase process94969592939391Responsiveness94939394959294Knowledge of real estate market92919491929096Communication skills90909191918482Negotiation skills83848684817578People skills80788080827871Knowledge of local area77697577788081Skills with technology47404445505152IMPORTANCE OF AGENT COMMUNICATIONS 2024 NAR Home Buyers and Sellers Generational Trends73Exhibit 4-12(Percent of Respondents)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Calls personally to inform me of activities73rerxq%Sends me postings as soon as a property is listed/the price changes/under contract70687068706970Sends me property info and communicates via text message71767268726463Sends me emails about my specific needs48505047484636Can send market reports on recent listings and sales50525149525345Has a website29252827333636Has a mobile site to show properties27252527323138Active in local community/volunteerism14121614161715Is active on social media1417161214159Sends me an email newsletter75579109Advertises in newspapers3222368Has a blog1*11132SATISFACTION WITH REAL ESTATE AGENT SKILLS AND QUALITIES 2024 NAR Home Buyers and Sellers Generational Trends74Exhibit 4-13(Percent Ranking Very Satisfied)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Knowledge of purchase process 90%Responsiveness 88888889888686Honesty and integrity89888988898991Knowledge of real estate market 88878886878989People skills87888787878783Communication skills86858586848588Knowledge of local area 81798282828584Skills with technology81858281827978Negotiation skills 77757578767885WOULD BUYER USE REAL ESTATE AGENT AGAIN OR RECOMMEND TO OTHERS 2024 NAR Home Buyers and Sellers Generational Trends75Exhibit 4-14(Percentage Distribution)75ssutw%5%4%5%5%5%3%4%4%4%4%5%5%5%3%1%1%2%2%1%1%1%0 0%All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98DefinitelyProbablyProbably NotDefinitely NotDont KnowHOW MANY TIMES BUYER RECOMMENDED AGENT 2024 NAR Home Buyers and Sellers Generational Trends76Exhibit 4-15(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98None30466ACF%One time12171515141412Two times14181718151718Three times8119910912Four or more times36202322201712Times recommended since buying(median)1111111Chapter 5Financing the Home Purchase772024 NAR Home Buyers and Sellers Generational TrendsFinancing the Home PurchaseEighty percent of recent buyers financed their home purchase.Ninety-six percent or more of buyers 43 years and younger financed,whereas only 57 percent of Older Baby Boomers financed their home and 50 percent of the Silent Generation.Fifty-four percent of buyers said their downpayment came from their savings.Thirty-seven percent of buyers down payment came from the proceeds from the sale of a primary residence.Seventy-four percent of Younger Millennials and 63 percent of Older Millennials used savings for their downpayment,compared to only 39 percent of Older Boomers and the Silent Generation.Older buyers were most likely to use equity from a past home.Younger Millennials used a gift or loan from friends and family more than any other generation.Seventeen percent of all buyers cited that saving for a down payment was the most difficult step in the home buying process.This share was 38 percent for Younger Millennials compared to only one percent for Older Baby Boomers.Twenty-three percent of all buyers reported having student loan debt with a median amount of$30,000.Younger Millennials had the highest share of student debt at 41 percent,with a median amount of$30,000.Older Baby Boomers were less likely to have student debt at four percent,and Gen Xers had the highest balance with a median amount of$40,000.Sixty-six percent of all buyers used conventional loans to finance their homes.Sixty-seven percent of Younger and Older Millennials used a conventional loan,compared to 70 percent of Older Baby Boomers and the Silent Generation.Eighty-two percent of all buyers reported they viewed a home purchase as a good investment,and 86 percent of Younger Millennials said owning a home was a good financial investment.782024 NAR Home Buyers and Sellers Generational TrendsFinancing the Home Purchase792024 NAR Home Buyers and Sellers Generational TrendsExhibit 5-1 BUYERS WHO FINANCED THEIR HOME PURCHASEExhibit 5-2 PERCENT OF HOME FINANCEDExhibit 5-3 MEDICAN PERCENT OF DOWN PAYMENTExhibit 5-4 SOURCES OF DOWN PAYMENTExhibit 5-5 YEARS DEBT DELAYED HOME BUYERS FROM SAVING FOR A DOWN PAYMENT OR BUYING A HOMEExhibit 5-6 EXPENSES THAT DELAYED SAVING FOR A DOWN PAYMENT OR SAVING FOR A HOME PURCHASE,BY AGEExhibit 5-7 SACRIFICES MADE TO PURCHASE HOMEExhibit 5-8 DIFFICULTY OF MORTGAGE APPLICATION AND APPROVAL PROCESSExhibit 5-9 BUYER MORTGAGE APPLICATION HAD BEEN REJECTED FROM MORTGAGE LENDERExhibit 5-10 BUYER PREVIOUSLY SOLD A DISTRESSED PROPERTY(SHORT SALE OR FORECLOSURE)Exhibit 5-11 BUYERS WHO HAVE STUDENT LOAN DEBTExhibit 5-12 TYPE OF MORTGAGEExhibit 5-13 TYPE OF LOANExhibit 5-14 BUYERS VIEW OF HOMES AS A FINANCIAL INVESTMENTBUYERS WHO FINANCED THEIR HOME PURCHASE 2024 NAR Home Buyers and Sellers Generational Trends80Exhibit 5-1(Percentage Distribution)80dWP%0 0%All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98PERCENT OF HOME FINANCED 2024 NAR Home Buyers and Sellers Generational Trends81Exhibit 5-2(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Less than 50%6%81)P%to 59b559141160%to 69b56911971%to 791314141291580%to 89#26272219181490%to 94191412104895%to 99221712847100%Financed the entire purchase price with a mortgage1291113996Median percent financed85xeq%MEDIAN PERCENT DOWN PAYMENT2024 NAR Home Buyers and Sellers Generational Trends82Exhibit 5-3(Percentage Distribution)155)%0 %All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98SOURCES OF DOWN PAYMENT 2024 NAR Home Buyers and Sellers Generational Trends83Exhibit 5-4(Percent of Respondents Among those who Made a Downpayment)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Savings54tcSC99%Proceeds from sale of primary residence37133037526053Gift from relative or friend920147211Sale of stocks or bonds71387466401k/pension fund including a loan6778521Inheritance4344541Loan from relative or friend3433112Proceeds from sale of real estate other than primary residence3123434Equity from primary residence buyer continues to own2221222Tax Refund25221*Individual Retirement Account(IRA)2222432Loan or financial assistance from source other than employer1211*Sale of crypto currency1211*Loan from financial institution other than a mortgage1111121Loan or financial assistance through employer*1%1%1%*YEARS DEBT DELAYED HOME BUYERS FROM SAVING FOR A DOWN PAYMENT OR BUYING A HOME 2024 NAR Home Buyers and Sellers Generational Trends84Exhibit 5-5(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98One year16(C%Two years19251817129*Three years131613111015*Four years68465414Five years191921172111*More than five years28143336343443Median4355535EXPENSES THAT DELAYED SAVING FOR A DOWN PAYMENT OR SAVING FOR A HOME PURCHASE,BY AGE 2024 NAR Home Buyers and Sellers Generational Trends85Exhibit 5-6(Percent of Respondents Who Reported Saving for a Down Payment was Difficult)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Share Saving for Down payment was Most Difficult Task in Buying Process:178$%5%1%*Debt that Delayed Saving:Student Loans5295%6%1%*High rent/current mortgage payment4243352616104Credit card debt362331281593Car loan31302518931Childcare expenses2192082*Health care costs1291211841Other14202136597991Median Years Debt Delayed Home Purchase Among Those Who Had Difficulty Saving3243400SACRIFICES MADE TO PURCHASE HOME 2024 NAR Home Buyers and Sellers Generational Trends86Exhibit 5-7(Percent of Respondents)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Cut spending on luxury items or non-essential items31IA2%6%Cut spending on entertainment233430251384Cut spending on clothes182723191063Cancelled vacation plans12171514861Paid minimum payments on bills915121052*Earned extra income through a second job71311832*Sold a vehicle or decided not to purchase a vehicle61076531Moved in with friends/family without paying rent5964332Other 4445453Did not need to make any sacrifices56354454717888DIFFICULTY OF MORTGAGE APPLICATION AND APPROVAL PROCESS 2024 NAR Home Buyers and Sellers Generational Trends87Exhibit 5-8(Percentage Distribution Among those who Financed their Home Purchase)8%9%8%8%9 !#CPFQQCH)#! !%0 0Pp0 x to 9869 to 7759 to 6844 to 5834 to 4325 to 33All BuyersMuch more difficult than expectedSomewhat more difficult than expectedNot difficult/No more difficult than expectedEasier than expectedREASONS MORTGAGE LENDER REJECTED BUYER APPLICATION 2024 NAR Home Buyers and Sellers Generational Trends88Exhibit 5-9(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Have had application denied4%3%5%6%3%2%2%Median number of times application was denied1221122Debt-to-income ratio48565149383633Low credit score2126291925*Income was unable to be verified1011571720*Insufficient down payment814153*33Not enough money in reserves16142217*57Too soon after refinancing another property1*3*10*Dont know77279*29Other23253118215014BUYER PREVIOUSLY SOLD A DISTRESSED PROPERTY(SHORT SALE OR FORECLOSURE)2024 NAR Home Buyers and Sellers Generational Trends89Exhibit 5-10(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Sold distressed property8%4%4%9%7%4%Year sold distressed property(median)2012202220142011201120122020BUYERS WHO HAVE STUDENT LOAN DEBT 2024 NAR Home Buyers and Sellers Generational Trends90Exhibit 5-11(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 77Have student loan debt23A5$%9%4%Under$10,00014 0%$10,000 to$24,999292723292226$25,000 to$49,999212323202039$50,000 to$74,9991213141364$75,000 or more2322292333*Median amount of student loan debt$30,000$30,000$40,000$34,500$34,400$20,100*Less than 1 percentTYPE OF MORTGAGE 2024 NAR Home Buyers and Sellers Generational Trends91Exhibit 5-12(Percentage Distribution Among those who Financed their Home Purchase)86%6%9%7%6%6%4%8%4%4%4%4%3%4%3%2%4%2%2%1%2%1%2%1%1%2%2%5%1%0 0%All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Fixed-rate mortgageFixed-then adjustable rate mortgageAdjustable-rate mortgageDont knowOtherTYPE OF LOAN 2024 NAR Home Buyers and Sellers Generational Trends92Exhibit 5-13(Percentage Distribution Among those who Financed their Home Purchase)66ggdipp%9%9%7%4%5%5%4%2%2%7%3%4%3%2%2%5%1%0 %All Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98ConventionalFHAVADont KnowOtherBUYERS VIEW OF HOMES AS A FINANCIAL INVESTMENT 2024 NAR Home Buyers and Sellers Generational Trends93Exhibit 5-14(Percentage Distribution)AGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Good financial investment82yutter than stocks44414544444346About as good as stocks28322729282622Not as good as stocks101310109107Not a good financial investment5345567Dont know13121312131618Chapter 6Home Sellers and Their Selling Experience942024 NAR Home Buyers and Sellers Generational TrendsHome Sellers and Their Selling ExperienceYounger Boomers made up one of the largest shares of home sellers at 26 percent,had a median age of 64 years,and a median income of$103,000.Gen Xers made up the second largest share of sellers at 23 percent,with a median age of 52 years.Sixty-five percent of sellers were married couples.Married couples were highest among Older Millennials at 77 percent.For all sellers,the most commonly cited reason for selling their home was to move closer to friends and family(23 percent),the home was too small(13 percent),followed by a change in family situation(10 percent).Older generations were more likely to move closer to family/friends,and younger generations were more likely to desire a larger home.Sellers typically lived in their homes for 10 years before selling.Younger Millennials stayed in their homes for four years,compared to 15 years for sellers 59 and older.Eighty-nine percent of home sellers worked with a real estate agent to sell their homes,which was consistent across all age groups.For recently sold homes,the final sales price was a median 100 percent of the final listing price.Thirty-two percent of home sellers reduced the asking price of their home at least once.Thirty-five percent of Silent Generation sellers reduced their asking price at least once,compared to 26 percent of Older Millennials.Twenty-three percent of all sellers offered incentives to attract buyers.This varied across age groups,where it was less likely for Silent Generation sellers to offer incentives and more likely for Younger Millennial sellers.Seventy-one percent of sellers were very satisfied with the selling process.952024 NAR Home Buyers and Sellers Generational TrendsHome Sellers and Their Selling Experience962024 NAR Home Buyers and Sellers Generational TrendsExhibit 6-1 AGE OF HOME SELLERSExhibit 6-2 HOUSEHOLD INCOME OF HOME SELLERSExhibit 6-3 ADULT COMPOSITION OF HOME SELLER HOUSEHOLDSExhibit 6-4 NUMBER OF CHILDREN UNDER THE AGE OF 18 RESIDING IN HOME SELLER HOUSEHOLDExhibit 6-5 EDUCATION OF HOME SELLERSExhibit 6-6 RACE/ETHNICITY OF HOME SELLERSExhibit 6-7 PRIMARY LANGUAGE SPOKEN IN HOME SELLER HOUSEHOLDExhibit 6-8 FIRST-TIME OR REPEAT SELLERExhibit 6-9 LOCATION OF HOME SOLDExhibit 6-10 TYPE OF HOME SOLDExhibit 6-11 SIZE OF HOME PURCHASED COMPARED TO HOME RECENTLY SOLDExhibit 6-12 NUMBER OF BEDROOMS AND BATHROOMSExhibit 6-13 PRIMARY REASON FOR SELLING PREVIOUS HOMEExhibit 6-14 SELLER WANTED TO SELL EARLIER BUT WAITED OR STALLED BECAUSE HOME WAS WORTH LESS THAN MORTGAGEExhibit 6-15 TENURE IN PREVIOUS HOMEExhibit 6-16 DISTANCE BETWEEN HOME PURCHASED AND HOME RECENTLY SOLDExhibit 6-17 METHOD USED TO SELL HOMEExhibit 6-18 SALES PRICE COMPARED WITH LISTING PRICEExhibit 6-19 NUMBER OF WEEKS RECENTLY SOLD HOME WAS ON THE MARKETExhibit 6-20 NUMBER OF TIMES ASKING PRICE WAS REDUCEDExhibit 6-21 INCENTIVES OFFERED TO ATTRACT BUYERS,BY NUMBER OF WEEKS HOME WAS ON THE MARKETExhibit 6-22 SATISFACTION WITH THE SELLING PROCESSExhibit 6-23 URGENCY OF SALEAGE OF HOME SELLERS 2024 NAR Home Buyers and Sellers Generational Trends97Exhibit 6-1(Percentage Distribution)Median Age in Group18313852647280Note:Sellers 24 years and younger only made up only two percent of the share of all sellers.They were not included in chapters 6 or 7 on home sellers due to the low number of responses for analysis.6&#%6%2%5 %0%Silent Generation:78 to 98 yearsOlder Boomers:69 to 77 yearsYounger Boomers:59 to 68 yearsGen Xers:44 to 58 yearsOlder Gen Y/Millennials:34 to 43 yearsYounger Gen Y/Millennials:25 to 33 yearsGen Zers:18 to 24 yearsHOUSEHOLD INCOME OF HOME SELLERS 2024 NAR Home Buyers and Sellers Generational Trends98Exhibit 6-2(Percentage Distribution)*Less than 1 percentAGE OF HOME SELLERAll Sellers18 to 2425 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Less than$25,0002%1%1%1%4%3%1%$25,000 to$34,99946*1467$35,000 to$44,99946211478$45,000 to$54,9997462481311$55,000 to$64,9996158235812$65,000 to$74,99954553767$75,000 to$84,99974866968$85,000 to$99,9998410879910$100,000 to$124,9991526201614141618$125,000 to$149,999109151012965$150,000 to$174,9999*111211953$175,000 to$199,9995*37954*$200,000 or more1811123027151011Median income(2022)$111,100$82,500$112,500$147,600$143,220$103,000$85,200$81,100 ADULT COMPOSITION OF HOME SELLER HOUSEHOLDS 2024 NAR Home Buyers and Sellers Generational Trends99Exhibit 6-3(Percentage Distribution)*Less than 1 percent65vwhdX %8!%8%2%7%6%8%8%5%8%8%6%5%2%2%3%2%1%3%2%2%4%0 0%All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Married coupleSingle femaleSingle maleUnmarried coupleOtherNUMBER OF CHILDREN UNDER THE AGE OF 18 RESIDING IN HOME SELLER HOUSEHOLD 2024 NAR Home Buyers and Sellers Generational Trends100Exhibit 6-4(Percentage Distribution of Home Seller Households)*Less than 1 percent753&q3 %3%2%2#3%2%0%1%6!%4%1%1%0%0 0%All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98NoneOneTwoThree or moreEDUCATION OF HOME SELLERS 2024 NAR Home Buyers and Sellers Generational Trends101Exhibit 6-5(Percent of Respondents)AGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Less than high school1%*1%*1%*1%High school diploma17151013241719Associates degree145414141614Bachelors degree30343632292524Some graduate work865681013Masters degree/MBA/law degree24343327192520Doctoral degree761175710*Less than 1 percentRACE/ETHNICITY OF HOME SELLERS 2024 NAR Home Buyers and Sellers Generational Trends102Exhibit 6-6(Percent of Respondents)AGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98White/Caucasian89%Hispanic/Latino574851*Asian/Pacific Islander3283231Black/African-American4436433Other2223221Note:Respondents were permitted to select as many races and ethnicities as they felt applicable.The percentage distribution may therefore sum to more than 100 percent.*Less than 1 percentPRIMARY LANGUAGE SPOKEN IN HOME SELLER HOUSEHOLD 2024 NAR Home Buyers and Sellers Generational Trends103Exhibit 6-7(Percentage Distribution)*Less than 1 percent990%1%2%3%2%1%1%*0 0%All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98EnglishOtherFIRST-TIME OR REPEAT SELLER 2024 NAR Home Buyers and Sellers Generational Trends104Exhibit 6-8(Percentage Distribution)30b(%8q8r%0 0%All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98First-time sellerRepeat sellerLOCATION OF HOME SOLD 2024 NAR Home Buyers and Sellers Generational Trends105Exhibit 6-9(Percentage Distribution)AGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Suburb/Subdivision489TQPH5%Small town19171720171922Urban area/Central city14221814151311Rural area1522913131417Resort/Recreation area4*224616*Less than 1 percentTYPE OF HOME SOLD 2024 NAR Home Buyers and Sellers Generational Trends106Exhibit 6-10(Percentage Distribution)AGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Detached single-family home79qsw%Townhouse/row house813167755Apartment/condo in a building with 5 or more units4643232Duplex/apartment/condo in 2 to 4 unit building34132312Other7664665SIZE OF HOME PURCHASED COMPARED TO HOME RECENTLY SOLD 2024 NAR Home Buyers and Sellers Generational Trends107Exhibit 6-11(Median Square Feet)Size of home soldSize of home purchasedDifference in Square FeetAll Sellers2,0001,800-20025 to 331,6002,10050034 to 431,8002,40060044 to 582,1002,20010059 to 682,0001,900-10069 to 772,0001,800-20078 to 982,1001,800-300NUMBER OF BEDROOMS AND BATHROOMS 2024 NAR Home Buyers and Sellers Generational Trends108Exhibit 6-12(Percentage Distribution)AGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98One bedroom1%*1%1%1%2%2%Two bedrooms165411182936Three bedrooms or more83959589827062Median number of bedrooms3333333One full bathroom101379101111Two full bathrooms62605453647173Three full bathrooms or more28273937261816Median number of full bathrooms2222222*Less than 1 percentPRIMARY REASON FOR SELLING PREVIOUS HOME 2024 NAR Home Buyers and Sellers Generational Trends109Exhibit 6-13(Percentage Distribution)*Less than 1 percentAGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Want to move closer to friends or family23%8(5D%Home is too small13313712551Job relocation8171614411Neighborhood has become less desirable989111086Change in family situation(e.g.,marriage,birth of a child,divorce)10111013675Home is too large9116111516Moving due to retirement8*1415114Want to move closer to current job38462*1Upkeep of home is too difficult due to health or financial limitations41136710Schools became less desirable1132*Can not afford the mortgage and other expenses of owning home1*12221Other10871510814SELLER WANTED TO SELL EARLIER BUT WAITED OR STALLED BECAUSE HOME WAS WORTH LESS THAN MORTGAGE 2024 NAR Home Buyers and Sellers Generational Trends110Exhibit 6-14(Percentage Distribution)*Less than 1 percent10%7%6%7%3%2%3%*1%1%1%1%*90%0 0%All SellersYes,and lived in homeYes,but rented home to others and lived elsewhereNo,sold home when wanted to sellTENURE IN PREVIOUS HOME 2024 NAR Home Buyers and Sellers Generational Trends111Exhibit 6-15(Percentage Distribution)*Less than 1 percentAGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 981 year or less2%9%4%2%1%1%1%2 to 3 years1227161191184 to 5 years1441191611986 to 7 years1216211191268 to 10 years1251910991811 to 15 years12*16161291116 to 20 years11141613101421 years or more25*118354034Median104610151515DISTANCE BETWEEN HOME PURCHASED AND HOME RECENTLY SOLD 2024 NAR Home Buyers and Sellers Generational Trends112Exhibit 6-16(Median Miles)30251530905086020406080100All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98METHOD USED TO SELL HOME 2024 NAR Home Buyers and Sellers Generational Trends113Exhibit 6-17(Percentage Distribution)*Less than 1 percentAGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Sold home using an agent or broker89%Seller used agent/broker only88899092848589Seller first tried to sell it themselves,but then used an agent1*111*Received quote from iBuyer,but sold with real estate agent/broker*For-sale-by-owner(FSBO)7873888Seller sold home without using a real estate agent or broker7863887First listed with an agent,but then sold home themselves*1*1Sold home to a homebuying company2212221Sold it through an iBuyer program*2*Other2*22331SALES PRICE COMPARED WITH LISTING PRICE 2024 NAR Home Buyers and Sellers Generational Trends114Exhibit 6-18(Percentage Distribution of Sales Price as a Percent of List Price)AGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Less than 90%7%5%6%9%7%6%9%to 941681211131095%to 99192321242726100&171924242325101%to 110$333624252219More than 110181010810Median(sales price as a percent of listing price)100000000%NUMBER OF WEEKS RECENTLY SOLD HOME WAS ON THE MARKET 2024 NAR Home Buyers and Sellers Generational Trends115Exhibit 6-19(Percentage Distribution)*Less than 1 percentAGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Less than 1 week12%5%7%81 to 2 weeks434651444437373 to 4 weeks151715151713195 to 6 weeks786668157 to 8 weeks611585849 to 10 weeks324343211 to 12 weeks424446213 to 16 weeks343345217 to 24 weeks435424325 to 37 weeks221321*38 to 53 weeks1*111253 or more weeks*1Median weeks2222223NUMBER OF TIMES ASKING PRICE WAS REDUCED 2024 NAR Home Buyers and Sellers Generational Trends116Exhibit 6-20(Percentage Distribution)AGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98None,did not reduce the asking price68ithdae%One19171313242625Two7558798Three4447332Four or more26432*Less than 1 percentINCENTIVES OFFERED TO ATTRACT BUYERS,BY NUMBER OF WEEKS HOME WAS ON THE MARKET 2024 NAR Home Buyers and Sellers Generational Trends117Exhibit 6-21(Percent of Respondents)*Less than 1 percentAGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98None77httww%Home warranty policies96910998Assistance with closing costs711119665Credit toward remodeling or repairs61177695Other incentives,such as a car,flat screen TV,etc.3833425Assistance with condo association fees*1*1*Other3*32235SATISFACTION WITH THE SELLING PROCESS 2024 NAR Home Buyers and Sellers Generational Trends118Exhibit 6-22(Percentage Distribution)71fepsix!% !%5%6%5%5%5%6%2%4%3%5%5%3%4%2%0 0%All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Very SatisfiedSomewhat SatisfiedSomewhat DissatisfiedVery DissatisfiedURGENCY OF SALE2024 NAR Home Buyers and Sellers Generational Trends119Exhibit 6-23(Percentage Distribution)AGE OF HOME SELLERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Very urgently,needed to sell home as quickly as possible131%5%3%Somewhat urgently,had to sell home but within a reasonable time frame43485144394237Not urgently,waited for right offer for home44212640505360Chapter 7Home Selling and Real Estate Professionals1202024 NAR Home Buyers and Sellers Generational TrendsHome Selling and Real Estate ProfessionalsSixty-five percent of recent home sellers used a referral or the same real estate agent they had worked with in the past.That number jumped to 67 percent for Older Millennial sellers.Forty-six percent of sellers used the same agent to buy and sell their homes.As age increased,using the same agent declined as distance moved increased.Thirty-eight percent of the Silent Generation used the same agent versus 66 percent among Younger Millennial sellers.Eighty-eight percent of sellers listed their homes on the Multiple Listing Service(MLS),which was the number one source for sellers to list their homes,followed by yard signs.The typical seller has recommended their agent once since selling their home.Thirty percent of sellers recommended their agent three or more times since selling their home,and that number jumped to 38 percent among Younger Millennials.Eighty-seven percent said that they would definitely(73 percent)or probably(14 percent)recommend their agent for future services.Older Millennials were the most likely to definitely recommend their agent(74 percent).1212024 NAR Home Buyers and Sellers Generational TrendsHome Selling and Real Estate Professionals1222024 NAR Home Buyers and Sellers Generational TrendsExhibit 7-1 METHOD USED TO FIND REAL ESTATE AGENTExhibit 7-2 NUMBER OF AGENTS CONTACTED BEFORE SELECTING ONE TO ASSIST WITH SALE OF HOMEExhibit 7-3 DID SELLER USE THE SAME REAL ESTATE AGENT FOR THEIR HOME PURCHASE?Exhibit 7-4 HOME LISTED ON MULTIPLE LISTING SERVICEExhibit 7-5 LEVEL OF SERVICE PROVIDED BY THE REAL ESTATE AGENTExhibit 7-6 WHAT SELLERS MOST WANT FROM REAL ESTATE AGENTS,BY LEVEL OF SERVICE PROVIDED BY THE AGENTExhibit 7-7 MOST IMPORTANT FACTOR IN CHOOSING A REAL ESTATE AGENT TO SELL HOME,BY LEVEL OF SERVICE PROVIDED BY THE AGENTExhibit 7-8 METHODS REAL ESTATE AGENT USED TO MARKET HOMEExhibit 7-9 NEGOTIATING THE COMMISSION RATE OR FEE WITH THE REAL ESTATE AGENTExhibit 7-10 WOULD SELLER USE REAL ESTATE AGENT AGAIN OR RECOMMEND TO OTHERSExhibit 7-11 HOW MANY TIMES SELLER RECOMMENDED TYPICAL AGENTExhibit 7-12 AGENT COMPENSATIONMETHOD USED TO FIND REAL ESTATE AGENT 2024 NAR Home Buyers and Sellers Generational Trends123Exhibit 7-1(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Referred by(or is)a friend,neighbor or relative3978B9%Used agent previously to buy or sell a home26313031242020Website(without a specific reference)5674552Referred by another real estate agent/broker4153645Personal contact by agent(telephone,e-mail,etc.)4323458Visited an open house and met agent3145322Direct mail(newsletter,flyer,postcard,etc.)2211234Walked into or called office and agent was on duty11*1126Referred through employer or relocation company15131*Saw contact information on For Sale/Open House sign12111*1Saw the agents social media page without a connection12*111*Newspaper,Yellow Pages or home book ad1*114Advertising specialty(calendar,magnet,etc.)1211*1*Crowdsourcing through social media/knew the person through social media1211*Other113108121411NUMBER OF AGENTS CONTACTED BEFORE SELECTING ONE TO ASSIST WITH SALE OF HOME 2024 NAR Home Buyers and Sellers Generational Trends124Exhibit 7-2(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98One81wt%Two129910131512Three6344797Four1*121*Five or more11*111*DID SELLER USE THE SAME REAL ESTATE AGENT FOR THEIR HOME PURCHASE?2024 NAR Home Buyers and Sellers Generational Trends125Exhibit 7-3(Percentage Distribution Among Sellers Who Used an Agent to Purchase a Home)46fWH788T4CRccc%0 %All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Used same agentUsed new agentHOME LISTED ON MULTIPLE LISTING SERVICE 2024 NAR Home Buyers and Sellers Generational Trends126Exhibit 7-4(Percentage Distribution)88%4%3%4%4%6%4%6%8%7%7%8%8%8%0 0%All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Listed on MLSDid not list on MLSDont knowLEVEL OF SERVICE PROVIDED BY THE REAL ESTATE AGENT 2024 NAR Home Buyers and Sellers Generational Trends127Exhibit 7-5(Percentage Distribution)AGE OF HOME BUYERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98A broad range of services and management of most aspects of the home 85%A limited set of services as requested by the seller 7586664The agent listed the home on the MLS and performed few if any additional services86897107WHAT SELLERS MOST WANT FROM REAL ESTATE AGENTS,BY LEVEL OF SERVICE PROVIDED BY THE AGENT 2024 NAR Home Buyers and Sellers Generational Trends128Exhibit 7-6(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Help sell the home within specific timeframe22& %Help price home competitively21181923232522Help seller market home to potential buyers20142219231917Help seller find ways to fix up home to sell it for more141215911108Help find a buyer for home11131113141423Help with negotiation and dealing with buyers6875755Help with paperwork/inspections/preparing for settlement3743235Help seller see homes available to purchase1211122Help create and post videos to provide tour of my home*1Other1111211MOST IMPORTANT FACTOR IN CHOOSING A REAL ESTATE AGENT TO SELL HOME,BY LEVEL OF SERVICE PROVIDED BY THE AGENT 2024 NAR Home Buyers and Sellers Generational Trends129Exhibit 7-7(Percentage Distribution)AGE OF HOME BUYERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Reputation of agent331)1557%Agent is honest and trustworthy21252822211814Agent is friend or family member14181316131317Agents knowledge of the neighborhood117912101413Agent has caring personality/good listener5765556Agents commission5275433Agents association with a particular firm4223462Agent seems 100cessible because of use of technology like tablet or smartphone2522135Professional designations held by agent12*1312Other4144632METHODS REAL ESTATE AGENT USED TO MARKET HOME 2024 NAR Home Buyers and Sellers Generational Trends130Exhibit 7-8(Percent of Respondents Among Sellers Who Used an Agent)AGE OF HOME BUYERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Multiple Listing Service(MLS)website85%Yard sign60606062635855Open house54485258565159R51554957524638Real estate agent website48514849524639Third party aggregator 46685952423227Real estate company website43454241444343Social networking Web sites(e.g.Facebook,Twitter,etc.)2136322617109Virtual tours16151315181517Video125813161211Direct mail(flyers,postcards,etc.)8588879Other Web sites with real estate listings 6656858Online classified ads 56544510Virtual open houses5445536Real estate magazine website3133323Print newspaper advertisement2222225Real estate magazine2123212Video hosting Web sites2222214Television11*1*2Other3132533*Less than 1 percentNEGOTIATING THE COMMISSION RATE OR FEE WITH THE REAL ESTATE AGENT 2024 NAR Home Buyers and Sellers Generational Trends131Exhibit 7-9(Percentage Distribution)AGE OF HOME BUYERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Real estate agent initiated discussion of compensation50HCQRIV%Client brought up the topic and the real estate agent was able and willing to negotiate their commission or fee19101618192625Client brought up the topic and the real estate agent was unwilling or unable to negotiate their commission or fee5534855Client did know commissions and fees could be negotiated but did not bring up the topic11161511989Client did not know commissions and fees could be negotiated1521241613135WOULD SELLER USE REAL ESTATE AGENT AGAIN OR RECOMMEND TO OTHERS 2024 NAR Home Buyers and Sellers Generational Trends132Exhibit 7-10(Percentage Distribution)*Less than 1 percent73thttsw%6%7%7%5%7%5%6%6%5%8%5%5%9%3%1%1%2%1%1%1%0 0%All Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98DefinitelyProbablyProbably NotDefinitely NotDont Know/Not SureHOW MANY TIMES SELLER RECOMMENDED TYPICAL AGENT 2024 NAR Home Buyers and Sellers Generational Trends133Exhibit 7-11(Percentage Distribution)AGE OF HOME BUYERAll Sellers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98None401739A7%One time14211516101712Two times16101816141720Three times10137138911Four or more times20252322291620Times recommended since buying(median)1112212AGENT COMPENSATION2024 NAR Home Buyers and Sellers Generational Trends134Exhibit 7-12(Percentage Distribution)*Less than 1 percentAGE OF HOME BUYERAll Buyers25 to 3334 to 4344 to 5859 to 6869 to 7778 to 98Paid by seller75bir%Percent of sales price92889091889089Flat fee4434655Per task fee*2Other111112Dont know3865553Paid by buyer and seller12161311121010Paid by buyer only79910462Other12231*Dont know51284352Methodology1352024 NAR Home Buyers and Sellers Generational TrendsIn July 2023,NAR mailed out a 129-question survey using a random sample weighted to be representative of sales on a geographic basis to 189,750 recent home buyers.The recent home buyers had to have purchased a primary residence home between July 2022 and June 2023.A total of 6,817 responses were received from primary residence buyers.After accounting for undeliverable questionnaires,the survey had an adjusted response rate of 3.6 percent.Respondents had the option to fill out the survey via hard copy or online.The online survey was available in English and Spanish.Consumer names and addresses were obtained from Experian,a firm that maintains an extensive database of recent home buyers derived from county records.Information about sellers comes from those buyers who also sold a home.All information in this Profile is characteristic of the 12-month period ending June 2023,with the exception of income data,which are reported for 2022.In some sections comparisons are also given for results obtained in previous surveys.Not all results are directly comparable due to changes in questionnaire design and sample size.The median is the primary statistical measure used throughout this report.Due to rounding and omissions for space,percentage distributions may not add to 100 percent.NATIONAL ASSOCIATION OF REALTORSSome results are presented for the four U.S.Census regions:Northeast,Midwest,South,and West.The median is the primary statistical measure used throughout this report.Due to rounding and omissions for space,percentage distributions may not add to 100 percent.Data gathered in the report is based on primary residence home buyers.The definitions of the generations used to distinguish home buyers and sellers were based on a study published in the REALTOR Universitys Center for Real Estate Studies journal article titled,Generational Trends in Homeownership:An Era of Renters?by Glenn E.Crellin.Additional splitting of older baby boomer age groups and younger baby boomer age groups was modeled on research from the Pew Research Center,Generations 2010.1362024 NAR Home Buyers and Sellers Generational TrendsYear Born:Year Born:Age Age in 2023in 2023:Gen Zers:Gen Zers:1999-201118 to 24Younger Gen Y/Millennials:Younger Gen Y/Millennials:1990-199825 to 33Older Gen Y/Millennials:Older Gen Y/Millennials:1980-198934 to 43Gen Xers:Gen Xers:1965-197944 to 58Younger Boomers:Younger Boomers:1955-196459 to 68Older Boomers:Older Boomers:1946-195469 to 77Silent Generation:Silent Generation:1925-194578 to 98NATIONAL ASSOCIATION OF REALTORSNATIONAL ASSOCIATION OF REALTORSThe National Association of REALTORS is Americas largest trade association,representing more than 1.6 million members,including NARs institutes,societies and councils,involved in all aspects of the real estate industry.NAR membership includes brokers,salespeople,property managers,appraisers,counselors and others engaged in both residential and commercial real estate.The term REALTOR is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of REALTORS and subscribes to its strict Code of Ethics.Working for Americas property owners,the National Association provides a facility for professional development,research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system and the right to own real property.RESEARCH GROUPRESEARCH GROUPThe Mission of the NATIONAL ASSOCIATION OF REALTORS Research Group is to produce timely,data-driven market analysis and authoritative business intelligence to serve members,and inform consumers,policymakers,and the media in a professional and accessible manner.To find out about other products from NARs Research Group,visit www.nar.realtor/researchwww.nar.realtor/research-andand-statisticsstatistics.NATIONAL ASSOCIATION OF REALTORSNATIONAL ASSOCIATION OF REALTORSResearch Group500 New Jersey Avenue,NWWashington,DC 20001202-383-1000datanar.realtordatanar.realtor2024 National Association of REALTORS All Rights Reserved.May not be reprinted in whole or in part without permission of the National Association of REALTORS.For reprint information,contact datanar.realtordatanar.realtor
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