Curating the perfect blend of stay length to deliver superior investor returns

edyn CEO Stephen McCall has spent most of his 25-year career indulging his passion for hospitality, with roles in operations, finance and governance across several continents. Before joining SACO in 2018 (which later rebranded to edyn), he held a number of executive roles at IHG including CFO for ME&A, MD for UK&I and most recently European COO. Stephen has led edyn to become one of the fastest-growing pan-European lifestyle hybrid platforms of its kind anywhere in Europe. A chartered accountant by training and Scotsman by birth, Stephen enjoys fast cars and malt whisky…but never together.

Andrew Sangster: What is the appeal of serviced apartments to guests?
Stephen McCall: The fundamental question I often pose is ‘why would you stay in a traditional hotel room rather than one of our apartments?’. Aside from the obvious functional benefits – more space, greater utility from the addition of a kitchen, etc – we believe guests are seeking more flexibility and autonomy…a space to live rather than just a room to sleep in. But it is true to say that historically service apartments and the broader extended stay sector have had limited consumer appeal given their often bland and corporate design. At edyn we have combined the best elements of the lifestyle experience – high design, animated common spaces, community-led experiences, independent F&B concepts – with the functional benefits of apartments; all for a broadly similar price point to a mainstream hotel.

Are serviced apartments a good deal for investors?
Operating margins across the extended stay sector are substantially higher than traditional hotels – lower cost of customer acquisition, leaner staffing etc - and the resilience of the model highlighted during covid provides some protection against downswings in the cycle…so it’s a very appealing model to investors when considering both profitability and investment risk management. At the peak of covid we still covered all our marginal costs on-property, but since the recovery, we continue to yield across all revenue segments – from leisure to corporate, one night to one year – and this helps us diversify revenue risk and build a solid base business.

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The Hotel Yearbook 2023 - Annual Edition

As we have embarked on 2023, it is evident that the hotel industry has made a robust recovery from the pandemic. Occupancy and pricing have returned to their pre-pandemic levels. However, the future of our industry is contingent on how nimble the hospitality sector can be in adapting to ongoing innovation, changing market conditions, evolving consumer preferences, new staffing challenges, and sustainability realities. These uncertainties are the new normal in an unpredictable world.
www.hotelyearbook.com/edition/2023.html