In the world of real estate investment, finding innovative ways to maximize profits while providing valuable services is key to success. One such avenue gaining traction is the concept of corporate rentals.
In Canada’s bustling cities like Kelowna, Victoria, Vancouver, Toronto, and Montreal, the demand for corporate rentals is on the rise. But what exactly are corporate rentals, and why should you consider running one from your property? Let’s delve into the benefits, considerations, and insights into what corporate rental agencies seek when scouting properties.
Understanding Corporate Rentals
Corporate rentals, also known as executive rentals or furnished apartments/spaces, cater primarily to business travellers, professionals on short-term assignments, and relocating employees. These rentals offer fully furnished accommodations with utilities and amenities included, providing a home-away-from-home experience.
The Benefits of Operating a Corporate Rental
- Steady Income: Corporate rentals often command higher rents compared to traditional long-term leases. Moreover, they typically experience lower vacancy rates due to consistent demand from business travellers and professionals.
- Secondary option for short-term rental operators regulated out by B.C.’s short-term rental accommodations legislation. No need to dismantle your beautifully appointed rental to transition it to long-term tenants.
- Minimal Turnover: Unlike traditional rentals where tenants frequently come and go, corporate tenants usually stay longer resulting in less turnover and reduced expenses associated with property turnover.
- Furnished Advantage: Furnished properties eliminate the need for tenants to purchase furniture or appliances, making them highly attractive to transient professionals seeking convenience and comfort.
- Flexible Lease Terms: Corporate rentals offer flexibility in lease terms, allowing property owners to adjust rental durations to accommodate requirements set by any relevant regulatory authorities, and the varying needs and capitalize on peak demand periods.
- Tax Benefits: In many jurisdictions, expenses related to furnishing and maintaining corporate rentals may be tax-deductible, providing additional financial incentives for property owners.
Considerations for Running a Corporate Rental
- Legal Compliance: Familiarize yourself with local regulations and zoning laws governing short-term rentals to ensure compliance and avoid potential legal issues. For example, B.C., Canada requires a 90-day minimum stay to place corporate stays.
- Insurance Coverage: Consult with your insurance provider to secure adequate coverage for corporate rentals, as standard homeowner’s insurance policies may not offer sufficient protection for short-term rentals.
- Maintenance and Cleaning: Regular maintenance and professional cleaning are essential to maintain the quality and appeal of your property, ensuring positive guest experiences and favourable reviews.
- Tenant Screening: Implementing thorough screening processes to vet potential tenants and mitigate risks associated with property damage or non-payment is vital. At Roam, we fully vet all guests.
Optimizing Your Property for Corporate Rentals
Corporate rental agencies seek properties that meet specific criteria to optimize bookings and ensure guest satisfaction. Key features include:
1. Location: Proximity to business districts, transportation hubs, and amenities is crucial to attract corporate tenants seeking convenience and accessibility.
2. Quality Furnishings and amenities: Well-appointed furnishings and modern amenities enhance the appeal of corporate rentals, contributing to positive guest experiences and favourable reviews. Added amenities appreciated by working professionals are recommended. Think EV chargers, coffee bars, wireless phone chargers by the bed, desk workspaces/offices, and lightning-speed internet. It’s worth noting that bare-bones listings don’t perform in this market.
3. Utilities and Services: Including utilities, internet access, and optional housekeeping services simplifies the rental process for guests and enhances the overall value proposition.
4. Security and Privacy: Properties equipped with secure entry systems and privacy measures offer peace of mind to corporate guests, fostering a sense of safety and security during their stay.
Booking Process and Property Acquisition
Corporate rental agencies utilize various channels to book properties, including online platforms, networking with management companies like Roam, and partnerships with relocation companies and corporate clients. They prioritize properties that meet the specific needs and preferences of their target clientele, focusing on location, amenities, and overall value proposition. At Roam, we optimize our marketing and listings to offer what these agencies are seeking. We leverage agency-to-agency bookings to lower the risk of direct booking to guests.
In conclusion, running a corporate rental from your property in Canada presents a lucrative opportunity to capitalize on the growing demand for mid-term accommodations among business travellers and professionals. By understanding the benefits, considerations, and preferences of corporate rental agencies, property owners can optimize their offerings and maximize returns in this thriving market segment. With careful planning, attention to detail, and a commitment to exceptional guest experiences, corporate rentals can become a rewarding venture for savvy real estate investors in Canada’s dynamic rental market.