WHAT ’ S DRIVING DEMAND AND WHICH FACTORS ARE SHAPING THE SERVICED ACCOMMODATION INDUSTRY ?
GSAIR 2024 : APAC 8
IT ’ S ALL EYES ON INDIA :
WHAT ’ S DRIVING DEMAND AND WHICH FACTORS ARE SHAPING THE SERVICED ACCOMMODATION INDUSTRY ?
By SOFIA ORAGANO Senior Director , International Sales , Synergy Global Housing
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 .
As business travel and mobility accelerates throughout India , this rapidly flourishing powerhouse has emerged as the land of opportunity for corporates — with its serviced accommodation landscape growing right along with it .
What ’ s driving demand for serviced accommodation in India ?
While India ’ s 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 government ’ s 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 .
Which 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 India ’ s political and economic activities .
Which factors are shaping the serviced accommodation industry ?
Increased demand for intern-friendly products
India ’ s 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