Two decades since the idea was materialised, the serviced apartment providers have started becoming wary of the possibilities of unhealthy competition marring the business. “There are only about a dozen serviced apartments in the core area, but now even hotels are dipping into the same pool and starting a similar kind of service for their clients intending to stay longer than usual,” says Narendra Bajracharya, managing director at The Comfort Care Pvt Ltd.“We are worried that the quality of service will suffer due to the imminent price war that will ensue,” he adds.

Niraj Bajracharya, operational manager at Park Village Hotel, which is managing Habitat Apartments, admits to a number of hotels extending their wings without catering to the basic needs of the apartment. “Although there is no threat from serviced apartments, the ones that hotels are providing for their clients by compromising on quality threaten to bring about unhealthy competition,” says Niraj, quickly adding that they have paid utmost attention to details to ensure their clients do not suffer on any front.

Serviced apartments are living arrangements offered for lease that promise comprehensive hotel-related services for expats. Equipped with a kitchen and providing a homely environment, these apartments are targeted at guests who visit Nepal for either short or long duration for varied purposes.

According to Narendra, the demand for serviced apartments escalate in two cases — when the country is undergoing transition or when there is high potential for investment.

The post-insurgency period in the country saw entrance of various INGOs and even some UN-affiliated wings, which resulted in an increase in the number of delegates.This resulted in the demand for serviced apartments.

Roma Subba, a property advisor of Apartment Kathmandu, says, “Expats who come to Nepal for business, research or any other purpose prefer serviced apartments, which not only give them homely environment to live and work, but also happen to be economical.“As per her experience, expats who plan to stay between a month to six months opt for serviced apartments. She informs that they get more demand for Baluwatar and Sanepa area, as these localities are accessible and at a stone’s throw from international and government offices.

Elaborating on the serviced apartments being more reasonable than hotels, Narendra says, “While hotels charge on daily basis for accommodation, these apartments charge on weekly or monthly basis. Thus comparatively, the cost of renting a serviced apartment turns out to be 30 to 50 per cent cheaper than staying in hotels.“ The price for serviced apartments ranges from USD 500 to USD 1,500 per month depending upon the size of the apartment and facilities. Some apartments determine the base line charge and then charge for electricity, gas and other services separately as per the consumption of the clients, whereas these facilities are inclusive in the monthly charges of others. Furnished with tasteful decoration, these apartments also boast of additional facilities such as television, cable satellite, wireless internet service, laundry and fitness centre. The areas like Pulchowk, Bishalnagar, Lazimpat, Narayanchaur, et cetera are reportedly other prime areas for serviced apartments.

“The business this year is down by 10 to 15 per cent as compared to last year,“ Narendra says. According to him, political instability, unfeasible condition for foreign investment, and the government differentiating in provisions for hotels and such serviced apartments in terms of tax exemptions are some of the hassles that the business faces.

Habitat Apartments has 22 apartments, including a villa.According to Niraj, they have been working in the sector for the last four years and expats prefer to stay there owing to the natural environment in Budhanilkantha. Stating that they charge according to duration of stay, size and facilities, he informs, “A single bedroom costs USD 700 whereas double and triple bedrooms cost USD 1,000 and USD 1,200 respectively.“ He says that they are providing internet, swimming pool, gym, meditation centre and other recreational facilities for the convenience of the expats.

source: The Himalayan Times,9 June 2012