The serviced apartment brand smartments business is celebrating its 10th anniversary and is stepping up its expansion. Following the opening of the first property near the Outer Alster in Hamburg in 2013, the portfolio currently comprises eight properties in operation in Germany and Austria with 1043 units.

Today at the Expo Real trade fair, another location decision is announced for Bielefeld with 223 units directly at the main railway station, meaning that four serviced apartment buildings are under construction. The building in Bielefeld will open in 2025. “Overall, this portfolio is to be more than doubled by 2027,” announces Burak Ünver, Managing Director of smartments.

In 2022, a record operating profit was achieved with an occupancy rate of more than 80%, although coronavirus restrictions still had to be observed in some cases. “We are currently increasing our average daily rate (ADR) by more than 20% compared to the previous year,” says Burak Ünver, citing the latest figures. These apply to the three smart apartments in Berlin, the two properties in Vienna and the other locations in Hamburg, Munich and Mannheim. Ünver: “Thanks to these good results, we are also well above budget for 2023.”

In future, smartments’ expansion will not only include its own developments, but also the acquisition of existing properties and portfolios – both classic hotels and other long-stay accommodation. Pure lease agreements with other project developers and portfolio holders are also possible,” explains Ünver: “This multi-expansion strategy is a response to the changed market situation. We are in an excellent starting position for the new challenges and are also adapting our structures accordingly.”

An important aspect of the expansion is the diversification of the offering. In addition to smart apartments, where each apartment has its own kitchenette, there is now also a stronger community focus. The new concept includes shared kitchens, supplemented by co-working and co-living areas. In the new Bielefeld building, 67 of the 223 apartments will not have their own kitchen. “We are targeting young professionals in particular,” emphasizes Ünver. This group of guests has a particular need to meet people in an uncomplicated way after returning to their accommodation, even when traveling on business, without having to do without a private retreat. “This creates a community that makes it easier to settle into a new city,” says Ünver.

Sustainability also plays a central role: in Bielefeld, a photovoltaic system is being installed to use the building’s own electricity, so that the building can be certified to the KfW 40 standard.

The continuous expansion of smartments is also making the company increasingly interesting for investors. In the past, institutional investors such as Hanse Merkur Grundvermögen, Württembergische Lebensversicherung and Catella have invested in the concept. The buildings currently under construction in Frankfurt and Bielefeld were acquired by abrdn Investments Deutschland AG and Hanse Merkur Grundvermögen. “Serviced apartments impress with their long-term rental agreements and economic stability. Our investors have not had to accept any rent losses to date,” emphasizes Burak Ünver.