Focusing on the BGC business traveler

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By Zsarlene B. Chua

INTERNATIONAL budget hotel chain, ZEN Rooms, has introduced ZEN Homes — its solution to what the company sees as a current lack of affordable accommodations in one of the country’s most prominent central business districts, Bonifacio Global City (BGC) in Taguig.

“Until now, there were simply zero professional affordable options for travelers in BGC — only luxury hotels and amateur Airbnbs,” Nathan Boublil, ZEN Rooms cofounder and global managing director, told BusinessWorld in an e-mail interview late-December 2017.

The dearth of options, he said, puts travelers in a tight spot: luxury hotels are expensive and while amateur Airbnbs are “clearly more affordable, it is not the most reliable or the safest options.”

“[Airbnbs are] not even necessarily cheap as there are no economies of scale on the service,” he explained.

So, in order to provide a more affordable and reliable option, ZEN Rooms has introduced serviced apartments which can cost as low as P2,000/night all-in and includes facilities like pools, gyms and fully functional kitchens.

“ZEN Homes [has] the service level of a mid-range hotel and is cheaper than an Airbnb. We are able to achieve such low prices thanks to the economies of scale of managing many units and hotels (unlike amateur Airbnbs who cannot spread their cost across units),” Mr. Boublil said.

Located at the ICON Plaza and Forbeswood Parklane, ZEN Rooms currently operate 70 “homes” and plans to introduce 50 more by the first quarter of 2018.

ZEN Rooms, a budget hotel brand backed by Rocket Internet SE of Germany, was founded in the middle of 2015 by Nathan Boublil and Kiren Tanna, who built FoodPanda.com in 2012 — also backed by Rocket Internet — which has become the largest food delivery service in Asia.

Unlike budget hotel brands which typically construct properties from the ground-up, ZEN Rooms operates by taking over existing rooms in already-built buildings such as condominiums or hotels and re-branding them and furnishing them with all the fixtures of a hotel: a front desk, a restaurant, etc.

The serviced apartments are also bigger spaces — from 40 square meters for studio rooms to 60 square meters for apartments which can house four people. And because of the added amenities, Mr. Boublil said guests stay for around one week on average.

“Professionals having meetings in BGC would have to stay in Makati and then commute. Amateur Airbnbs is often not an option for them given the lack of reliability and planning needed to check in/out,” he said of the rationale behind the apartments.

“Given this lack of budget hotels that we could possibly franchise and work with, we decided to create the offering ourselves from scratch, by taking apartment units under management and operating them,” he added.

ZEN Rooms first introduced the service in Makati in the first quarter of 2017 and decided to replicate it in BGC during the last quarter of the same year, noting that since opening in BGC, its current customer demographics are skewed towards professional/business travelers (60% profession and 40% leisure.)

“Given the excellent customer satisfaction ratings, we are now growing our ZEN Home division fast, benefiting travelers and real estate owners — and essentially turning into the largest budget serviced apartment business in the Philippines, in addition to our budget hotel franchise,” he said.

ZEN Rooms entered the Philippine market in 2016 and is now currently operating more than a thousand rooms in 10 cities nationwide. In Asia, the company is currently operating more than 5,000 rooms in over 35 locations including Indonesia, Malaysia, Thailand, Sri Lanka, Hong Kong, and Singapore.