The area of serviced accommodation has been an attractive and innovative area for developers and investors for many years, often being a catalyst for bespoke property education courses focussing on this sector.
However, it has often thrown up confusion and conflicting advice to those believing that it is straightforward in planning terms and flexible, no matter what your intended business model or property set-up.
This month, we will take a look at a few of the cases around this area to highlight some of the key issues and reflect on some practical considerations. This is not intended to be an exhaustive review of all of the key case law or planning appeal decisions, and planning or legal advice should be sought in any specific case if in doubt, especially to avoid the possibility of planning enforcement action at a later date, the forfeiture of a lease or breach of finance terms.
What is ‘serviced accommodation’?
There is no legal definition for the term serviced accommodation. Broadly speaking, it is used to refer to a furnished apartment that provides amenities, housekeeping, and other services for guests within the cost of rental. Serviced apartments can sometimes provide amenities similar to those offered in hotels, such as laundry and cleaning, and sometimes include access to gyms, and even concierge services, but in a self-catering setting.
Serviced apartments usually include a full kitchen, separate sleeping area, and bathroom, with internet and all utilities included and might comprise an area where each apartment is under the minimum for a self-contained apartment under the Nationally Described Space Standards (37 sqm). However, since 19 May 2016, fully-furnished layouts are not required to demonstrate compliance with national minimum space standards.
This should be contrasted with ‘holiday lets’. Whereas a serviced apartment is available from one night to several months and caters for a wide range of guest-types, holiday lets are more often residential properties that are commercially let to holidaymakers for weekends, weeks, or fortnights, but with no added servicing.
