Maria Jacobs and her husband left their home in South Africa and moved to Guangzhou, the capital city of south China's Guangdong Province, two years ago. She enjoys her life in the city, mainly because she lives in the Ascott high-end serviced apartment complex located in the city's downtown area, which is not only close to all kinds of entertainment, but also offers convenient access to major business and shopping districts nearby.

"My apartment is in a convenient location. This makes daily life easier for my family," said Jacobs. "Also, I can take advantage of all the amenities here. There is a fully equipped fitness center that I can use to relax."

"I really love the atmosphere here; it's so cozy and comfortable. It makes our stay [in Guangzhou] feel more like home," said Jacobs' husband, a senior executive with a South African financial institution, who deals with business affairs at the local branch.

Serviced apartments, a relatively new form of equipped residence in China, are more expensive than similarly sized residential apartments, but provide better services and amenities for daily use. Serviced residencies are increasingly popular among business travelers, corporate officials and senior executives of foreign-invested companies.

The Jacobs' residence, a three-bedroom apartment with an area of about 110 square meters, costs over 18,000 yuan ($2,900) per month, almost three times the rent for a similar-sized apartment nearby. Yet the majority of tenants, like her family, are choosing to stay in their serviced apartments for longer.

Supply and demand

Liew Mun Leong, Deputy Chairman of Singapore's Ascott Group Ltd., the world's leading owner and operator of serviced residences, believes more serviced apartments, which offer a high quality of living, will be needed as foreign businesses flourish in Guangzhou and other parts of China. "It provides great potential for us to expand serviced apartment business," he said.

The average rental rate of Shanghai's expatriate housing exceeded 90 percent last year, with highly sought-after properties such as Xintiandi and Green City achieving full occupancy, according to a latest report from real estate consultancy firm DTZ.

The occupancy rate of high-end serviced apartments at Shama Luxe Grand Central, located in Dalian's Development Area, northeast China's Liaoning Province, has stayed above 80 percent in the compound's first year of operation. Bhupesh Yadav, Shama's Chief Operating Officer (COO), is pleased with Shama's performance on the market.

Yadav said that serviced apartments are popular among families of senior executives of foreign-funded enterprises, like Goodyear and Intel, in the development area.

He believes the serviced apartment sector in Asia has an optimistic future. "The demand for serviced apartments has never been greater in China, particularly in second- and third-tier cities, such as Chengdu, Xi'an and Dalian," he said, adding that the company is strengthening its presence in these regions.

Liew said Ascott already has about 8,000 apartment units in China, close to 30 percent of its global total, and the company is now looking at second- and third-tier Chinese cities and strengthening its presence there. Ascott also announced in 2012 that it plans to add eight to 10 new blocks of serviced apartments every year over the next three to five years so as to maintain rapid growth in China.  

Consumers in China's southern region are quite savvy and pragmatic. If your rental is priced too high for the area, finding tenants may be difficult, but "Guangzhou's Ascott maintained 90 percent average occupancy rate," Liew said.

"Customers from different cultural backgrounds possess different preferences and needs, thus we provide a variety of services," explained Leng Juan, Marketing Manager of South China at the Ascott Ltd. She said that it is important for the company to meet the needs of a multicultural customer base while growing the business. "The China market is vital to us," she added.