St. Petersburg, 10 February 2023. In 2022, some 7,800 apartment units without official residential designation were marketed in St. Petersburg, including some 5,000 units within so-called apart-hotels (extended stay hotels, or serviced apartments), with the rest falling into the subcategory of pseudo-housing. Nikoliers data show that the share of serviced apartments in the larger “non-residential designation” (NRD) apartments segment shrank to 64% in 2022 from 77% in 2021.

In 2021, there were just 752 new units within two projects in the subcategory of pseudo-housing, including the recreational property Bereg.Kurortny (Element Development’s project), In 2022, the new offer in this subcategory amounted to 2,800 units within seven projects – Zoom na Neve, Zoom Chornaya Rechka, Cheval Court, Nasledie na Marata, Ryzhkina Mansion, Bolshoy Kazachy 10A Apartments, and Rimsky-Korsakov 22.

Nikoliers experts argue that NRD apartments should be called pseudo-housing, when the developer is going to sell such units to individuals, who either would be end users or rent the property out, rather than hand the apartments over to hospitality provider under a property management contract. Some development companies combine different approaches for the same project, which allows them to cover various strata of buyers from end-users through investors.

Active introduction of new NRD apartment projects resulted in an increased number of exposed units in this category: by the end of 2022, a total of 4,400 such units were offered for sale (up 82% y-o-y), including 1,300 pseudo-housing units.

Overall, the weighted average price for all NRD apartments exposed on the market rose 10% in 2022 to 280,000 roubles per square meter. In the pseudo-housing subcategory the average price slid 22% to 313,000 roubles per square meter, whereas for the serviced apartments it climbed 25% to 260,000 roubles per square metre.