A hotel room can be a sanctuary for weary business travellers unwinding after a long flight and day full of meetings. But after a week or two of being confined to a 300-square-foot room with a suitcase full of soiled clothes and using a Keurig and mini-fridge as a kitchenette, it can feel sort of depressing.
Enter extended-stay accommodations. Although such quarters are not as luxurious as a five-star hotel room, they offer something far more appealing to travellers staying put for a while, such as fully equipped kitchens where they can make their own meals, laundry facilities, and dedicated workspaces. They often include other perks like free Wi-Fi, a fitness center, and pet-friendly rooms.
As noted in our Hotel Monitor 2024, there’s been a significant demand for extended-stay properties as work and corporate travel patterns evolve. Globally recognised hotel brands have taken notice. In 2023, Marriott, Hilton, Hyatt, and Wyndham are among the hotel brands that announced plans to expand their long-stay offerings.
Corporations are responding to this growing demand as well. Marcus Flohr, a senior consultant with American Express Global Business Travel (Amex GBT) Consulting, says he’s receiving more queries from clients about adding extended stay hotels to their corporate travel programs.
What’s behind this growing trend?
Marcus says there are several factors responsible for the increasing phenomenon.
Because of the flexibility remote work has afforded people, travel patterns have been shifting. According to internal Amex GBT data, employees are taking longer business trips, with the average length of hotel stays rising 3% globally since 2019. For longer stays, many travellers prefer more spacious suites with full kitchens and on-site guest laundry services.
The rise of “work from anywhere” is another contributing factor. More companies are allowing employees to fulfill their dreams of working and living in other parts of the world. Whether this entails a month-long stay in a foreign land or a permanent relocation to a different city, extended-stay hotels can be a convenient temporary housing solution.
Furthermore, in recent years, travellers have put a greater emphasis on sustainability and well-being. To reduce the frequency of trips to a city they visit often, Marcus explains they may opt to stay there for weeks at a time rather than fly back and forth – both for the sake of the planet and their mental health.
Marcus observed that extended stays are becoming more popular everywhere. “Previously, I would say extended stays were very concentrated in the US and Europe, but now we are seeing more and more of these accommodations opening in Asia Pacific (APAC).”
There seems to be a real need in that region. Marcus has learned from conversations with clients that many individuals in high-tech industries are choosing to relocate to APAC with their families. While they are searching for more permanent housing, long-term stays are a convenient option.
You may be most familiar with traditional chains like Residence Inn, Home2 Suites, and Extended Stay America that have a more corporate vibe, but there’s a crop of new extended-stay properties that are straying from the muted design and making the spaces more colorful and playful. Some are also integrating open-plan public spaces, designed to facilitate effortless interactions among guests.
What qualifies as an extended stay?
Marcus says there’s no universal standard on what constitutes an extended stay. Each organisation may define it based on its travel patterns and the average number of days employees typically travel.
That said, he noted many companies consider 10 to 12 nights as a “short stay,” up to a month as an “extended stay,” and up to three months as a “long stay.”
Below are several tips Marcus suggests travel managers keep in mind when developing an extended-stay program.
Know your travel patterns.
The first step when getting started is to dig into your travel program data and identify the destinations where it makes sense to incorporate extended accommodations.
“Look at the places where you have a need, where there are requests for extended stays, where the numbers are growing,” Marcus said. “If you add 50 extended stay properties to the program, but nobody stays there, it’s a wasted effort.”
Think of safety.
Extended-stay options must be vetted with safety in mind. Having 24/7 on-the-ground assistance is essential in case a maintenance issue or another kind of emergency crops up. Properties should have secure entry points and a front desk with standardised check-in procedures. As Marcus explained, you don’t want employees staying in residences where there may be extra keys floating around or entrance keycodes previous guests can remember and reuse.
Consider your program priorities.
When selecting brands to include in an extended-stay program, Marcus frequently advises clients to weigh three key factors: pricing, sustainability, and travel-centric features. While the last one may sometimes be overlooked, it’s a crucial element.
“A property can look good on paper because it ticked all the boxes, but if it’s not the quality that your people need, it’s not worth it,” Marcus said. “I always like to say, ‘We cannot give everyone the hotel they want to stay at, but at least we should be trying to give everyone a hotel where they feel like their company cares about them.’”
Make sure you can capture booking data.
As Marcus explained, “Many extended stay hotels are not available on the online booking tools or through the global distribution systems.”
This raises a concern for managed travel programs from a duty of care perspective. When critical itinerary details aren’t captured through the online booking tools (OBTs), locating employees during a crisis can be challenging.
American Express Global Business Travel has addressed this issue by teaming up with WWStay, a platform providing access to more than 82,000 serviced apartments globally. Even though these bookings are made outside the OBT, through this partnership, we’re able to capture all the information companies need to know where their employees are staying at any given time.
Use the booking tool to push the right content.
While long-term accommodations can often be more cost-effective than traditional hotels, that’s not always the case. “You need to think about how you position an extended stay property that might come in at a higher price point,” Marcus said.
For corporate travel programs with hotel rate caps, the process can be straightforward. Let’s say your travel management company successfully negotiated a daily rate of $150 at Property A for stays lasting 14 or more nights when typically it would be $170. If your rate cap is set at $160, the OBT will only present Property A as an option when travellers are booking a stay for two weeks or more and won’t pop up in search results for those booking shorter stays.
Educate your travellers about the program.
Once you have established the program, it’s time to get the word out.
“Create an awareness that you have more to offer than just the standard hotel rooms and let travellers know about the booking process,” Marcus advised.
You can inform your travellers by promoting it through various channels, such as email, the intranet, and OBT.
What’s great about the OBT is you can use its features to drive travellers to the best choices during the search process – “not just from a price perspective,” Marcus said, “but also from a traveller-centricity and carbon emissions perspective.”
Are you working to build out your extended stay program? American Express Global Business Travel can help you with location selection, rate negotiation, and policy development. Connect with our Amex GBT Consulting team to learn more.