Serviced apartments and aparthotels as an investment

A serviced apartment, or aparthotel, is a self-contained flat with a kitchen that is let like a hotel room: by the night or the week, with reception, cleaning and a booking channel run by a professional operator. The format sits between a classic hotel and a residential rental, and it attracts investors who like the hotel's operator-led income but want a lighter cost base. This article explains where the model differs from a full-service hotel, what the licence usually means, and where the risks sit. It follows our hotel investment guide.

Who stays in serviced apartments

The core demand is not the two-night tourist. It is people who need more space and a kitchen for longer: relocating professionals, project and consulting teams, medical and academic visitors, families between homes, and insurance-driven stays after a fire or flood. Many of these guests are booked by companies or agencies, which can make occupancy steadier outside the holiday season. Leisure families on a one- or two-week holiday are the second segment, especially in resort markets.

The practical consequence is a longer average length of stay. That is good for income stability, but it also means fewer check-ins to sell on the nightly rate, and a pricing logic closer to a monthly rent with a hotel-style premium.

How the operating model differs from a full-service hotel

A full-service hotel sells rooms plus food and beverage, a bar, a spa, meeting rooms and a large team. A serviced apartment building usually sells the unit and little else. The typical differences are:

• Staffing. A small reception, housekeeping and maintenance team, often with a limited-hours front desk and digital check-in. Fewer departments mean a lower payroll share of revenue.
• Housekeeping. Longer stays mean less frequent full turnovers; guests may be cleaned weekly rather than daily. Linen and cleaning cost per occupied night is usually lower than in a hotel with daily service.
• Food and beverage. Often absent or minimal, so there is less revenue per guest but also far less operational complexity and less exposure to labour shortages.
• Units. Apartments are larger and have kitchens and laundry equipment, so the fit-out cost per unit and the wear on appliances are higher than in a standard hotel room.
• Distribution. A greater share of bookings can come from corporate accounts and direct channels, though online travel agencies remain important for shorter stays.

Fewer departments do not mean fewer fixed costs. Utilities, insurance, property tax, a reserve for replacing furniture and appliances, and the operator's fee still apply. The saving is real but is not automatic, and it is usually smaller than a first spreadsheet suggests.

Aparthotel versus short-let flat: the licence matters

Many investors confuse two different things. A short-let is a residential flat rented to tourists under a national, regional or municipal short-term rental regime. An aparthotel is a commercial tourist accommodation establishment: the building, or a defined part of it, is licensed and classified for tourism use, usually under one operator, with common areas, reception and safety systems.

The consequences differ by country, and they change often. In general:

• A short-let licence is tied to a residential unit and may be limited by caps, zoning, a maximum number of nights per year, building-association consent or a moratorium on new licences.
• An aparthotel is usually allowed in a building or zone designated for tourism or commercial use, and is subject to hotel-type rules on fire safety, accessibility, staffing and registration of guests.
• Buying individual apartments in a residential building and calling the project an aparthotel does not turn the building into a licensed aparthotel. Check what use the title, the planning permit and the operating licence actually cover.

For the country-by-country logic, see our article on hotel licensing and star classification. The real picture should always be confirmed with the national tourism authority and a local lawyer.

What drives returns, and why we do not quote a single yield

Net income comes from occupancy, average daily rate, a cost base and the operator's terms. We do not publish a typical yield for aparthotels, because published figures mix gross and net numbers, different countries and unit types, and often come from sellers. What can be said is the logic. Income should be tested on net operating income to the owner, after the operator's fees, utilities, insurance, local taxes and the furniture reserve, not on a gross rent figure. The method is explained in how to value a hotel.

A hypothetical illustration, with round numbers chosen only to show the mechanics: an owner of a 40-unit building assumes EUR 100 average daily rate and 70% occupancy. Revenue is then roughly EUR 1.02 million a year (40 x 365 x 0.70 x 100). If operating costs including the operator absorb 55% to 65% of revenue, the owner's income before debt and tax is roughly EUR 360,000 to 460,000. Lower occupancy to 60% and the same fixed costs take a much larger share. The point is sensitivity, not a forecast.

Operating arrangements for investors

Most private investors do not run an aparthotel themselves. The usual structures are a management contract, where you carry the trading result, or a lease to an operator, where you receive rent and carry the tenant risk. Both are described in hotel management agreements, leases and franchises. If you buy single units inside an operated building, read hotel unit rental pools and guaranteed yields first, because the pool terms decide your income more than the apartment does.

Main risks

• Regulation. Tourism or short-let rules can change, and a licence may not transfer automatically on sale.
• Operator dependence. A weak operator, or a lease backed only by a thinly capitalised company, is the biggest single risk in the model.
• Concentration. A building dependent on one corporate client or one employer in a city carries the risk of that client leaving.
• Capital expenditure. Kitchens, appliances and furniture wear faster than in a standard room; an underfunded reserve is common.
• Exit. Buyers of a block with a single operator are fewer than buyers of a flat, and some jurisdictions restrict the sale of single units.

FAQ

Is an aparthotel safer than a hotel? Not by itself. The operating model is lighter, but regulatory and operator risks remain, and the exit market is narrower.

Can I rent my own apartment as a serviced apartment? Only if the building and the unit are permitted for tourist use and the local regime allows it. Check the licence and the building rules first.

Do serviced apartments suit corporate demand? Often, because of the kitchen and space for longer stays, but corporate demand depends on the city and can be cyclical.

How do I compare an aparthotel with a long-term rental? On net income after all costs, vacancy, management and capital expenditure, and with the legal certainty of each regime. A higher gross figure does not mean a higher net figure.

How we help

We help you compare aparthotel and conventional rental opportunities on net numbers, check what the licence and title actually cover with independent local lawyers and tax advisers, and read the operator's terms before you commit. See hotels in our catalogue. This article is informational and is not legal, tax or investment advice. Verify the current rules in the country concerned.