Changing face of workspaces globally
A remote worker taking a ‘workation’ at a co-living and co-working space in the Philippines.
Singapore (TTG) -The rise of remote working has fuelled an appetite for extended stays among travellers seeking to escape from work-from-home routines. With that, hospitality players and destinations are adapting their offerings to tap on the longer-stay trend. With the global pandemic changing how people work, travel and live, the remote working trend continues to gather pace, with pristine beaches, expansive villas and even national parks being pitched as temporary workspaces to a rising breed of digital nomads.
Accommodation across the globe have reported longer-stay bookings fuelled by a rising tide of travellers looking for an escape from lockdown fatigue or a change in work scenery. Keen to tap on that growing demand, more hotels and destinations are rolling out longer-stay packages, ranging from one month to a year, with deep discounts and other perks to please this unusual breed of travellers. More remote workers are flocking to sandy beaches and the countryside for ‘workations’ as the pandemic gives rise to a work-from-anywhere culture
Sweetening the long-stay deal
From free vaccines to five-year visas, tourism authorities across Asia and West Asia are crafting strategies and dangling sweeteners to stir interest among long-stay tourists.
Dubai has since January started promoting free vaccines for all UAE residents as an added perk to its one-year virtual working programme launched last October.
Following on, in February, Ras Al Khaimah Tourism Development Authority rolled out its Live RAK Play programme, luring remote workers to call the emirate home for one month to a year. The programme comprises a host of long-stay offers across numerous hotels, complete with free Wi-Fi, discounted rates, complimentary tickets to attractions, and other perks. Similarly, Indonesian tourism officials are looking to tap into the burgeoning pool of remote workers facing work-from-home fatigue, in hopes of reviving the bruised sector. Once international travel reboots, Indonesia plans to offer a five-year visa for international tourists to carve out a second home in Bali, traditionally one of Asia’s hotspots for digital nomads.
According to Tourism Minister Sandiaga Uno, they can either opt for an individual package or one for the family, by making a deposit of US$142,300 or $178,000, respectively. The plan targets business owners and travellers who are looking to escape the cold winters in their native countries by staying at least three to four months in Bali. Foreign visitors will be allowed to work in Indonesia under this visa, renewable every five years. There are also plans to extend the programme to other parts of Indonesia, including Batam, Bintan and others within the ASEAN Travel Corridor Framework.
Work from home away from home
Private tourism stakeholders are also eager to capitalise on the extended ‘workcation’ trend to speed up recovery in the pandemic’s wake. In February, Hyatt Hotels Corporation launched The Great Relocate, offering a flat rate for long-term stays with a minimum 29-day booking for hotels across South-west Asia, West Asia and Europe.
Likewise, Centara Hotels & Resorts in January rolled out Work From Hotel (WFH) packages in destinations across Thailand, offering extended stays from two weeks to a month at reduced rates. The initiative came about as Centara saw a surge in remote workers, some with children in tow, looking to escape for “a significant period of time” to pastures new such as beaches or the countryside amid the pandemic, said Tom Thrussell, vice president of brand, marketing and digital at Centara Hotels & Resorts. A trend was also emerging of Bangkok-based residents migrating to different areas, like coastal towns, to escape the city’s air pollution, he added. “We see value in not just day packages but also longer-stay WFH packages, because people are taking this opportunity to change up their environment for a longer period,” he said, adding that the WFH trend “is here to stay for the foreseeable future”.
To date, Centara has seen “hundreds” of bookings for its WFH packages, with top locations being the drive destinations from Bangkok and Pattaya; and further afield, Phuket, also known as one of the areas in Thailand with the finest air quality, according to Thrussell. Buyers of WFH packages have been a mix of Thai and expatriate residents. While Centara also has a home-away-from-home package offering three- to six-month stays at slightly more competitive rates, demand has been subdued, said Thrussell. However, he expects more longer stays to come into demand once borders reopen.
Over in the Philippines, hotels and resorts are looking to court digital nomads booking long-term stays. To capture this growing segment, an online booking platform has been set up by Manila-based hostel owner Orly Darnayla. Baybayin Hub, referencing the word ‘coast’ in Filipino, connects a portfolio of local hotels and resorts with a current network of over 1,400 digital nomads seeking medium to long stays.
Currently, 35 resorts are on the platform, spanning six locations: from tourist hotspots like Boracay and Palawan to the scenic province of Pangasinan. Listings run the gamut from hostels and beach lodges to luxury resorts, with rates slashed up to 80 per cent and prices starting at $200 for a month-long stay. The idea was born out of the pandemic when occupancy at Darnayla’s hostel plunged from 99 per cent to zero amid the lockdown. To survive, he converted his hostel into a co-working and co-living space to tap the growing pool of remote workers, digital nomads and freelancers seeking an affordable workspace.
The move allowed Darnayla to continue operations at a time when leisure travel was banned, with only business travel permitted. His pivot took off, with revenue soaring by 20 to 30 per cent – inspiring him to set up Baybayin Hub to support other hotel operators to make the same transition. For each booking made via the site, the platform takes a 15 to 30 per cent cut.
The 25-key Birdland Beach Club, the first resort to join the platform, saw occupancy soar from zero to 95 per cent within the first month of converting into a co-working space. Gen-Zers and millennials make up the bulk of the platform’s clientele, with the rest comprising Gen X business owners and upper-class families, according to Darnayla.
Under the lockdown, guests were required to book a minimum one-month stay in accordance with legal requirements. But, following the rolling back of restrictions, the platform now also markets seven-day and 15-day stays. Since its October 2020 launch, over 400 rooms have been sold on the platform, with 15- to 30-day stays making up 98 per cent of bookings. Darnayla said he has seen a hike in longer-stay bookings, with some guests at lower-end accommodation opting to extend their month-long stay for three to six months.
“They will stay longer, especially when they have found a community of like-minded professionals to co-work and co-live with,” he said. “Also, they feel safer staying in our resorts in the countryside or province because they are not as crowded as compared to (those in) big cities.”
Darnayla sees the switch to target remote workers and digital nomads as a way to crisis-proof hospitality businesses, as in the event of another pandemic, they can continue operating as co-working spaces. Some of the platform’s resort partners are now investing to set up exclusive co-working spaces to cater for long-stay guests.
More companies are also catching on to the idea of flexible workspaces. In March, one of the biggest business process outsourcing (BPO) companies in the Philippines, with 47,000 employees nationwide, signed up to the Baybayin Hub platform. As well, a couple of small, local BPO companies are also due to come on board. Looking ahead, Darnayla plans to expand Baybayin Hub across South-east Asia, including countries like Japan, Thailand and Singapore. Centara’s properties across Thailand, including Centara Grand Mirage Beach Resort Pattaya, now offer extended stays at reduced rates
Embracing diversification, differentiation
The entry of more players into the long-stay market heralds new competition for established serviced residence providers who are vying for that same share of extended stay demand. To strengthen its position in the extended stay business and build the company’s global scale, Ascott – which manages a range of long-stay brands, including Ascott The Residence, Somerset, Citadines and co-living brand lyf – has embarked on various initiatives.
Last June, Ascott expanded into the rental housing segment in China to tap on the growing demand from young, mobile workers as well as returning students from abroad looking to rent quality fully furnished homes in the tier one and tier two cities on a long-term basis. “We have secured three rental housing properties in Shanghai and Hangzhou, increasing our presence in China’s high growth rental housing sector,” said Kevin Goh, CapitaLand’s CEO for lodging and Ascott’s CEO.
Further, the group’s hospitality trust, Ascott Residence Trust (ART), will foray into the US student accommodation sector with the acquisition of an Atlanta property for $95 million, as it looks to capitalise on the sector’s resilience amid COVID-19 headwinds. The purpose-built student accommodation, Signature West Midtown, boasts 525 beds across 183 units. “Student accommodation, with leases that typically last for a year, will build on our stable income streams,” said Goh. “It will offer a new platform for growth and also diversify ART’s portfolio beyond traditional hospitality assets, mitigating the near-term headwinds faced in the hospitality sector.”
To tap on the telecommuting trend, Ascott also capitalises on its serviced apartments to feed domestic demand, with the launch of Work in Residence and Space-as-a-Service last August in countries such as Singapore, Malaysia, Japan, Australia, China and Vietnam. As for Far East Hospitality (FEH), the company’s segmentation of its brands based on traveller profiles, instead of demographics or nationalities, has set it apart from its extended stay competitors, said Arthur Kiong, CEO of FEH. For instance, the company’s Village brand targets travellers with a keen interest on the local culture and wanting to experience living like a local, with edible gardens set up in its Village serviced residences so that residents can sample local vegetables in their own backyards.
Meanwhile, its Oasia brand targets the wellness-conscious traveller. Post-COVID, Kiong projects that families are likely to travel together out of safety considerations and that travellers will be opting for longer stays due to the inconveniences of travel. With the company offering accommodation options for shorter-term, with a minimum six-night stay, and extended stays for a minimum of three months, Kiong said that its serviced residence portfolio is well poised to meet these evolving trends.