Yangon's serviced apartment market may have come under strain as a result of COVID-19, but the lull in demand is expected to be short-lived, Colliers Myanmar says.

The firm's Colliers Yangon Serviced Apartment Market Report Q3 2020 shows citywide occupancy rate ended at 72 per cent for the quarter, with overall rental rates having corrected further downwards in a bid for operators to retain accounts, and perhaps generate new demand. 

Colliers International Myanmar Hpone Myint Thu said the sector had been impacted the repatriation of many expatriates since Q2 2020, which had followed a decrease in foreigners residing in Yangon.

"Based on government statistics, the total number of foreigners residing in Yangon has declined gradually since 2014 to end at 17,000 in 2019," he said.

 "With continuing relief flights, further decline in expatriates seems inevitable."

Sales Specialist for Residential Services of Colliers International Myanmar, Sitt Paing, said the drop in headline rental levels was most significant in studio and one-bedroom units with average monthly rates settling at USD1,390 and USD2,770.  

"While foreign arrivals remain momentarily halted, we expect demand to be feeble only in the near term," he said.

"Effectively renegotiating lease terms could also help buoy overall demand."

Mr Hpone said the resilient occupancy levels recorded in the past quarters coupled with the limited stock of mid-tier serviced apartments meant investors were likely to see serviced apartments as a bankable asset, not least in an emerging market such as Myanmar.

"Besides flexible payment terms and equipping work-from-home designs and setups, we also encourage operators to continually adopt a culture of personalized service while keeping hygiene standards at a high level,” he said.

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