The Future Lies in Serviced Residences

December 28, 2015

The Future Lies in Serviced Residences

Mr. Michael Lee in short:

Malaysian-born, hometown: Melaka
Have travelled around the Asia Pacific region
Have spent 25 years in the industry
A Singaporean hotel school graduate
Joined the airline for almost three years during younger days to gain travelling experience and character development
Worked at Singapore Pan Pacific Group and Pan Pacific Hotel Group properties in Malaysia; then moved on to Sama-sama KLIA, Sutera Harbour Resorts’ pre-opening team
Worked in China to oversee hotels in Zhuhai and Macau
Joined Indonesia’s Mulya Group as General Manager for the Anggerik Service apartments, the largest property in Indonesia
Served Shangri-La Chengdu and involved in bringing the much touted pandas to Malaysia
Returned to Malaysia and joined pre-opening for Fraser Residence, which is Fraser’s Malaysia largest property for now

What makes Fraser Residence Kuala Lumpur stand out

According to Michael, other serviced residences offer strictly rooms and don’t offer food and beverage (F&B), or if they do provide breakfast, they often outsource it to a third party, in most cases a bar or a lobby lounge, thus people don’t get the expected quality or standards. “We had guests who previously stayed at one of our competitors and had breakfast in an outlet run by a third party that is converted into a bar at night. When they had breakfast at 6:30 to 7:00 o’clock the next morning, the place was not clean and fit for dining,” utters Michael.

Traditionally, serviced residences have only be focussing on rooms because the profit margin is high, unlike the F&B business, which offers lower margin due to substantial costs involved. Fraser Residence is different because it runs its own F&B outlets, Relish, which is an all-day dining offering three meals a day located at the lobby, and Cafe on the Fifth located by the pool, which is a family restaurant. The property also offers full service in-room dining, 24-hour room service. In short, Fraser Residence Kuala Lumpur is anyone’s preferred serviced residence in Kuala Lumpur with full hotel facilities.

For Frasers Hospitality, the group looks at this matter differently; the group realises that customer trends have now changed and guests expect more choices from their lodgings, meaning that sometimes they would want to cook themselves or dine outside, as well as eating at the F&B outlet and order room service. “We can not keep telling customers that we are a serviced residence therefore our customers have to order food delivery. Frasers Hospitality has now moved up another level – our properties has more facilities and features such as in-house F&B outlets, 24-hour room service, and qualified chef,” Michael reveals.

During the recent Ramadan month, Fraser Residence Kuala Lumpur flew in the chef from Fraser Suites Dubai, Chef Hussain, who is stationed at the property a few weeks to train local employees on the preparation of authentic Middle Eastern cuisine since Relish served local and Middle Eastern fare throughout the period. Fraser Residence Kuala Lumpur is also working with the corporate office in Singapore to bring its Malaysian chef to promote Malaysian food in Australia and Europe. “If we were to look at the menu in Relish restaurant, one of the dishes served is the deeply comforting Nasi Goreng Indonesia, which is famous at Fraser Residence Menteng – Frasers Hospitality intends to bring the best of what it offers from the communities that they are present in and share it with the other international properties to enrich their customers’ experience,” says Michael.

Well thought out features

After the inception of Capri by Fraser in Bangsar last year, Frasers Hospitality opened Fraser Residence Kuala Lumpur in January this year. Michael states that Fraser Residence Kuala Lumpur targets two market segments, the first main component being the long-term guests (those who stay for a minimum of 30 nights – on average, long-term guests stay for six months). Another component is the leisure travellers who stay for three to five nights, with the average short-terms stays hovering at 2.4 nights. Compared to traditional hotels, which only focus on short stays, serviced residence like Fraser Residence Kuala Lumpur is strong in long-term stays.

Being a serviced residence, the property offers many facilities in all of its rooms. For the Studio, which is the entry level room, the size is already the largest in the market at 58 square metres. All rooms come with cooking facilities, washer and dryer, which are definite pluses because the other competitors do not have washer and dryer in the rooms. However, with such features, Fraser Residence Kuala Lumpur’s rates are more or less similar to the competitors’. “Why pay for smaller room that has lesser feature?” Michael quips.

Since Fraser Residence Kuala Lumpur is the flagship and the largest Frasers Hospitality property in the world, it does not operate like any other traditional serviced residence because it incorporates “the one button to call for anything, similar to a one-stop concierge or service centre” concept that is prevalent in hotels. Michael shares that guests’ demands from that one dial up button are directed to dedicated runners through their mobile devices, who will then attend to guest’s requests according to a standard delivery time. Interestingly, Fraser s Hospitality takes the pain in compiling those requests and analyse them to find out guests’ pattern of behaviour so that in the future, Frasers Hospitality will be able to easily anticipate guests’ needs.

Michael further expounds that many valuable insights have been extrapolated based on studying those requests and demands. Those insights have now been applied on Frasers’ Hospitality new properties and become Frasers Hospitality’s DNA, such as the provision of full length mirror for guests to preen themselves before leaving their rooms; signature working tables and chairs by Okamura or Herman Miller that are more ergonomic to support lengthy sitting; slow closures for furnishings that require opening and shutting like the toilet covers, drawers, cabinets and doors; built-in international adaptors in rooms; surround sound system; i-Pod deck; and simple basic shoe rack, which commonly lacks in traditional hotels. Michael labels those unique characteristics as the quintessential Fraser Difference. “This is the only property in Kuala Lumpur that has an impressive sky gym that capitalise on the 360-degree panoramic view of the city,” he claims. No wonder Fraser Residence Kuala Lumpur is accorded the Gold Standard due to these outstanding characteristics. The property also won the World Travel Award 2015 recently.

Frasers Hospitality DNA is very much reflected in its branding. Prior to attracting customers, the company works closely with their partners, the building owners, so that they adhere to Frasers Hospitality’s DNA. “For instance, once guests step into the lobby, they will see iMacs used by guests and staff. Fraser also requires partners to install saltwater pool and children’s room. Together with their partners, Fraser embarks on Fraser Care, which refers to the group’s CSR projects, including Fraser World Membership, which is the group’s loyalty programme that intends to convert travellers to become loyal customers and enjoy privileges such as opportunity to collect reward points in getting room upgrades, now planning to extend their reward point system to include airline tickets,” Michael elaborates.

Despite the spaciousness and impressive built-in facilities, there is not much difference in terms of prices between the serviced residence and hotel. Guests are encouraged to book their rooms online in advance because of the savings that travellers can reap.

What the future holds for serviced residences

Due to the Asian economic growth, the increase in the number of serviced residences is propelled by the more sophisticated travellers who expect more features from their lodgings; the other is due to the increasing number of Asian property investors eager to build serviced residences and seek out corporations like Fraser to manage.

In Kuala Lumpur, over three years ago, there was not so much news about hotel openings other than Frasers Hospitality’s properties such as Fraser Place Kuala Lumpur. But of late, more properties are coming up in the city. Indirectly this gives leverage to the Frasers Hospitality brand to expand.

“With stronger brand presence through more Frasers Hospitality properties popping up in Malaysia and the region, together with more people getting to know us and accustomed to how we do business, the brand is bound to become stronger. We are confident that we will soon become market leaders,” Michael claims.

When it comes to expanding the Fraser brand in Malaysia, Michael and his team assist Frasers Hospitality‘s corporate office in Singapore in doing the groundwork by hosting the site visit by the potential investors, providing them the basic information about Frasers Hospitality, how the corporation operates, and what Frasers Hospitality provides in terms of technical perspectives, sales, marketing, branding, operations and fee. As a GM, Michael is tasked on how to grow the brand in the region and coordinate with the other Frasers Hospitality properties in Malaysia.

Michael confessed that since opening, the property has been doing brisk business and strongly penetrated the market. “By second quarter, we hit our forecast,” Michael radiates. “The reason is because we have an excellent product that offers hotel facilities but different from a normal hotel as well as rated as Gold-standard,” Michael states in ending the conversation.

Michael’s advice to those who want to join the hospitality industry:

Graduates of the hotel industry need to be aware that in the next 10 to 15 years, they will see more growth of serviced residences besides hotels
Graduates who pursue hotel management should find opportunity to do internship in a hotel cum serviced residences environment to make themselves more marketable
The trend indicates that hotels are getting less popular – there would be more serviced residences coming into the market in the next few years, which will have an edge against traditional hotels
Fraser Residence Kuala Lumpur works with hotel schools and inform them that it is in the best interest of the graduates to work in serviced residences today and learn the ropes – by 15 to 20 years they will become GM of a serviced residence because the market is going to that direction