Records in the 2022 financial year
smartments achieves record occupancy and earnings in 2022
Berlin, 27.03.2023
smartments set new records in 2022 with an occupancy rate of 83.1% and an operating profit in the high single-digit million range. “Such a successful result is all the more pleasing because we could not have expected it and there were still significant restrictions in the first quarter of last year due to pandemic restrictions,” says Burak Ünver, Managing Director of smartments: “When we were able to operate freely again afterwards, the high demand made the record occupancy and earnings figures possible.”
smartments operates 1,043 serviced apartments at a total of eight locations in Germany and Austria. On average, guests stay for around one month. 76.3% belong to the long-stay target group with stays of between seven nights and a maximum of six months. “Thanks to this clear positioning, project workers, consultants, artists, freelancers and also weekend commuters and people starting a new job book us specifically,” says Ünver: “This means that we are much more accepted by travelers as a long-stay brand than most of our competitors in the serviced apartment segment.”
“In addition to the high occupancy rate, the profit was also optimized by consistently setting overnight rates based on data,” adds Ünver. “The algorithms we use check the rates for up to 25 apartment types at the eight locations eight times a day and adjust them if necessary,” explains smartments Managing Director Daniel Zawe: “We use this yielding to react to peaks in local demand, for example, or to return to the base prices when demand drops again.”
Another success factor is the consistent digitalization strategy, which enables efficient processes and low personnel costs. After booking, guests receive their access and usage codes directly on their smartphone and can thus check in flexibly at any time – even without personal contact. smartments has been relying on digital processes for years and works closely with technology partners such as hotelbird, apaleo and Straiv by Code2Order. “This relieves smartments employees of routine tasks, allowing them to concentrate on providing individual support and fulfilling guests’ special requests,” explains Zawe: “This increases their satisfaction and is a decisive factor in the high occupancy rate.”
The strong performance of smartments business is reflected not only in the high demand from travelers, but also in the interest shown by investors. In 2022, two smartments properties were sold during the construction phase: A building in Borsigallee in Frankfurt went to a special fund of Aberdeen Standard Investments, while another property at Frankfurt Airport – together with offices in the same property – was sold to an open-ended special fund of HanseMerkur Grundvermögen AG. The brand’s resistance to crises also convinced investors. “Thanks to the many long-stay guests, we had an occupancy rate of almost 50 percent even in the depths of the crisis. A figure significantly higher than that of the traditional hotel industry. Our strategy with a majority of long-stay guests has proven itself in this phase,” emphasizes Ünver.
Looking to the future, smartments is focusing on further growth. In addition to the ongoing construction projects in Frankfurt, the first pure rental property in the Hamburg-Mitte district will be completed in 2024 – independently of a project development. There, 160 smartments apartments will be built as part of a new quarter of the Hermann Friedrich Bruhn Group. “With the pure operator model, we can significantly accelerate our expansion,” says Ünver. “And in an ideal location with its proximity to Hamburg city center and excellent public transport connections.”
The mixed-use approach practised in the Gateway Gardens airport district is also supported by smartments. This combines not only serviced apartments and offices, but also traditional and subsidized housing, daycare centers, senior and assisted living, care facilities, student housing, hotels, commercial units, social facilities (e.g. doctor, pharmacy) and local amenities, depending on requirements. “This makes neighbourhoods livelier and more future-proof,” emphasizes Ünver: “And it also improves economic efficiency.”