Matteo Ghedini, founder of Brera Serviced Apartments, talks about the pros and cons of being a sector pioneer, and his plans for growing the business.
• Can you give us a brief career history and tell us when you first became aware of the serviced apartment sector?
"My career started in business consulting at The Boston Consulting Group, where I used to travel a lot for projects and found long stays in hotels extremely painful. I did not feel at home and I missed my private space. When I moved to Germany to turn around the family real estate business I had the chance to develop a new concept for an empty building in central Nurnberg, and I started thinking about a new form of hospitality which could merge the benefits of a private apartment and a hotel. At the time serviced apartments were very common in the UK, US and Asia but almost unheard of in Central Europe. Serviced apartments at the time was not even a 'sector', it was a pioneering idea which required a lot of explanation."
• And what was your motivation to start Brera? What was your vision for the company?
"Having experienced the anonymous atmosphere of hotels I wanted to give business travellers, who are away from home for a long time, a better experience. In fact, a thrilling and exciting experience. Thinking back about my travelling experiences I isolated the key features which made memories special. Almost always I identified personal positive interactions and new encounters as the one key fact which made memories great. This personal interaction and bonding between our hosts and our guests (as well as among guests) is still the key features of Brera Serviced Apartments, we live it with great pride and built it into our purpose of 'Turning guests into friends'. The second key feature which makes our company unique is the Italian design and atmosphere which we bring into our serviced apartments, through architecture, decoration and mood."
• You have recently signed deals for two major new-build projects in Germany - what else do you have in the pipeline and are you looking at other European countries?
"We are currently in advanced negotiations for further 700 apartments in six projects in Germany, which we hope to close over the next few months."
• Which are your top target cities for future locations?
"We are obviously targeting the top seven German cities but at the same time we are very aggressive on B- and C-cities in Germany with strong economic fundamentals."
• What are your growth targets for the next three and five years in terms of units?
"We are planning to have signed 2,300 apartments (20 properties) by 2020 and 4,400 apartments (40 properties) by 2022."
• What is the ratio of business v leisure travellers at your properties?
Our strength is clearly to serve the business traveller. Therefore our ratio is 95 per cent business to five per cent leisure guests. This is in line with our average length of stay (33 days) and our minimum length of stay (seven days)."
• How have Airbnb and similar companies affected your business? Do you list inventory on Airbnb?
"We have listed our properties on Airbnb, but only one property via the Siteminder connection as yet. We handle Airbnb in a similar to all other OTAs - to fill our gaps. We believe that the development of Airbnb in focusing on professional boutique hotels and apartments will be a further benefit for us."
• What do you know now that you wish you knew when you launched the business?
"Nice question. Probably the biggest learning was that when you enter a market as a first mover, there is no 'infrastructure' in terms of data, reports, track record, comparables and so forth. This makes the concept appear riskier to lenders, investors, partners and b2b customers and takes a toll on the growth pace. Once the sector started growing and becoming established, our growth pace started to catch up as well. I think I underestimated it at the beginning."
Brera Serviced Apartments is a sponsor of the 2018 Serviced Apartment Summit Europe which takes place in London next month. Click here to find out more.