Serviced apartments scale new heights

ireo service apartmets

Serviced apartments are fast becoming a hot real estate avenue, with as much as a 12-19 per cent annual yield on investments, against 10-12 per cent returns in the commercial segment.

Experts say in the serviced apartments space, developers, primarily from the hospitality sector, are targeting non-resident Indians (NRIs), expatriates and now, even domestic investors. To investors, this segment offers both capital value appreciation, as well as rental returns.

Hotel Leela, Grand Hyatt and Marriott International are among the major hospitality chains with serviced apartments. Ascott, one of the largest serviced residence owner-operator, has a tie-up with Ireo to offer such apartments in Gurgaon.

Now, the venture is expanding into other regions, too.

Many Gurgaon-based firms offer serviced apartments of various developers, including DLF and Unitech, to companies and tourists.

Ashutosh Limaye, head (research and real estate intelligence service), Jones Lang LaSalle India, says, “Of late, domestic investors, along with NRIs, are more keen to invest in serviced apartments, as the realty segment-— residential and commercial — isn’t offering very good returns. It is possible the returns in the serviced apartments space are as high as 12-19 per cent.”

He added the capital appreciation in the residential segment was five-seven per cent and less than five per cent in the commercial space.

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