A new joint venture between aparthotel brand Native and mixed-use developer First Base is targeting putting together a £400m network of aparthotels across the UK.
The JV has indentified an increasing demand for aparthotels across the country and the partners point to a report by JLL’s Serviced Apartment (available here) that suggests aparthotels are the fastest growing area of the hospitality sector, with supply increasing 13% in the past two years.
The JV says it will identify and secure aparthotel or mixed-use sites with a primary focus around London, Oxford, Cambridge, Bristol and Edinburgh. The joint venture aims to commit £200m in 2018 and an additional £200m in 2019.
The latest statistics from STR Global shows that from January to December 2017, average daily rate in the apart-hotel sector rose by 5.4%, leading to revenue achieved per room going up by 5.7%.
Each new site will benefit from Native and First Base’s design-led approach on ground up developments and the restoration of historic, city-centre buildings.
First Base will lead on design, planning and construction, and other target cities include Brighton, Reading, Manchester, York and Dublin.
Archie Hunter, development director at Native, a company with 20 years’ experience, said: “This partnership clearly demonstrates our commitment to standout aparthotel developments across the UK, at a time when the sector is set for significant expansion.”
“Our expansion will enable us to take our unique proposition to a greater range of key UK cities, addressing a significant gap in the market,” Hunter added.
Barry Jessup, director at First Base, said: “Demand far out-strips supply for aparthotels in these locations, and we see homestay living playing an important role in the revitalisation of town centres.
“We will begin work on these developments as soon as we have secured the sites and planning consent, such is the demand.”
Seventy percent owned by Ares Management, Native has a £1.7bn portfolio of assets under management and is one of the largest Built to Rent and aparthotel operators in the UK.
Clients include CBRE Global Investors, Dorrington, Grosvenor, Standard Aberdeen, Aviva and LaSalle Investment Management.
Photo shows Archie Hunter and Barry Jessup
