What you need to know:

• Urban Rest aims to corner the self-serve serviced apartment market for corporate travellers as well as digitise hotel management.
• It has 1,300 operational units across Australia, New Zealand, the UK and Ireland, a massive pipeline incoming – next up is a 150-room flagship in Melbourne’s Lonsdale Street. 
• Fully digital with a consolidated back office, none of Urban Rest’s properties have a front desk or physical customer services, instead relying on a human-machine network of agents to handle everything remotely.
• Three years ago Chief Commercial Officer Jeff Baars rebuilt the tech stack from scratch to enable a fully digitised service operation at scale.
• This year it went live with Agentic AI via Salesforce, one of the first companies in Australia to do so. Baars says the agents are already reducing the pressure on its call operators – and getting guests the answers they need much faster.
• So he’s rolling out agentics across every channel, bar one: He doesn’t think voice is up to scratch, yet.
• The upshot is that guests can truly self-serve, “which they never could before … and we are really focused on growing that because [whereas] currently about 20 per cent of our guests self-serve, we think most guests actually would like to self-serve.”
• Next he’s pushing AI into pricing and revenue management.

Some rest for the wicked

A globe-trotting equities analyst and one-time PwC exec, Dave Whelan knew the trade-offs between taking a decent, but expensive hotel room without the stuff needed for day-to-day life on longer trips, or a soulless serviced apartment. There was no real ability for corporates to use Airbnb, because there were no fixed rates, no reliability in the standards and no account managers to speak to. So he started Urban Rest in Sydney in 2017, taking out leases on a handful of apartments and bidding to bootstrap his way to scale.

Covid put a brake on the business, but since then it’s grown rapidly, inking deals with commercial property firms and developers on the supply side and blue-chip clients on the demand side. Now Urban Rest has branched out from pure corporate serviced apartments into full hotel management – but focusing on the business traveller, and digitised in a bid to become fully self-serve for those that want to do everything from their phone.

“We run either commercial leases on buildings anywhere from 20 to 150-200 units, or we run hotel management agreements – so we manage on behalf of the owner or investor, very similar to how an IHG Hilton would run,” per Chief Commercial Officer, Jeff Baars, who spent 15 years in marketing, ecom, digital and customer functions with the likes of IHG and GLH Hotels in the UK and Europe and with Quest Apartment Hotels in Melbourne, before joining Urban Rest in 2022.

In August, Urban Rest took on flagship asset The Oaks on Lonsdale, whose 149 units it now manages on behalf Hong Kong-based Ovolo Hotels, which acquired the lease in 2014.

“We are managing that asset on behalf of the owner … it is undergoing a full refurbishment and as of 1 February it will re-open as Urban Rest Melbourne CBD,” Baars told Mi3 on the sidelines of Salesforce’s recent Dreamforce event. “So that we’re kind of transitioning from corporate serviced apartments into full hotel management.”

But he sees growth in both sides of the business.

Digital hotels vs apartments

“We see a real big opportunity in running digital hotels. We think they are the future. People don’t particularly enjoy standing in a queue waiting to check in. We can take out all those frictions really easily: Make sure that people can go straight to their hotel room or hold their phone against the door to open it; get in touch with a guest service agent immediately on the app or or via WhatsApp or via email or call us; whatever they want to do, rather than having to go downstairs all the time,” he says.

“We also still see a real opportunity in the serviced apartment space. In corporate serviced apartments, particularly in Sydney, we enable locations where the big hotel chains can’t go – because their model works really well at 150, 200, 300, rooms. Whereas we, because of our model, can easily run 20, 30, 40 units. So if you want to be in Bondi, Surry Hills, or New Town, there’s no space to build those big assets, and we can enable that really quickly – our consolidated back office, our digital nature, kind of runs that. So we see a future in both.”

The numbers suggest he’s right. Per Baars, Urban Rest’s inventory – i.e. rooms, or “units” – is now “doubling every four months”. 

Demand is equally strong, as a result of Urban Rest taking an old-school approach: corporate sales teams “knocking on doors” of enterprise clients like Susquehanna, KPMG and Apple, says Baars. “We’ve also built relationships with all the large global travel management companies – Flight Centre Group, CWT, American Express Global Business Travel, all of those – as well as the more project-led media and entertainment agencies that are out there, and we work with them on a global level. So yes, that really hard business development effort has really paid off for us.”

Bootstrap re-stack

Rapidly doubling rooms – and global expansion – means equally rapid service enquiry volume increases, which in turn means Urban Rest needs more efficiency from a tech stack that Baars set about rebuilding when he joined in July 2022. 

It was scary, he admits, but also kind of fun.

“At that point we were a start-up or a small scale-up, so the tech stack was held together by sticky tape. I spent the first year of my time at Urban Rest slowly taking the sticky tape apart… and getting a bit frightened. But that was also the joy for me. I’ve been in hotels all my career. I know how the big chains run it. I know the limitations they have. Putting in a new system is really hard – the effect it has on everyone, because of the scale, is significant. So running at a really small scale and actually being able say, ‘Well, how do I start this [from scratch]’ was fantastic.”

The previous system was a typical start-up’s patchwork. 

“It was a standard hotel property management system attached to a separate database to hold all property information, attached to Zapier to automate a bunch of stuff, attached to Zen Desk for a ticketing system, attached to another program here that did something else, and another program there that did something else,” says Baars.

“So we just started from a position of ‘if we could ignore this tech stack altogether, what would it be?’”

Problem was, the hybrid nature of the business meant landing on one of the key components – the property management system, or PMS, where all the crucial information on bookings, payments and inventory sits – was tricky. 

“We couldn’t really find the right PMS … We weren’t a hotel at that point of time, so we couldn’t go for one of the big hotel PMS, because they’re very much ‘I’m going to check you in, I’m going to check you out’ and that very much in-person component.” 

On the flip side, systems for the short-term rental market were made to manage smaller stuff, i.e. multiple houses or homes, “so we were very much stuck between the two,” per Baars.

In the end, it opted to go for an API-based PMS designed for the short-term property market and build all the features it needed over the top, “and that’s probably where Salesforce came in,” he adds. 

Pretty much all of it.

“Sales Cloud, Service Cloud, Field Service, Revenue Clouds, we run Agentforce,” per Baars. But it’s also plugged in other software and linked platforms.

“We connected it to Xero for invoicing. We run our own digital online check in tool – so guests still go through that process – and we custom built that ourselves, but we connected it into Salesforce … We run a revenue management tool – revenue management in hotels, like airlines, is very complex – and there’s a bunch of other tools,” per Baars, that all link into the Salesforce system, so that staff are all working off a single platform – and crucially, the data is all linked. Which makes automation via AI much easier to get moving.

“The amount of data we store there is incredible,” says Baars. “When guests call up our guest relations team and say, ‘Hey, I don’t know how to operate my oven’, you want to speak to a person who sounds like they know that apartment inside and out, despite the fact that they’ve probably never been to the country.

“So every single detail about an apartment is stored in Salesforce, including video, room by room, apartment by apartment, with instructions on how to use that. So our team can sound incredibly knowledgeable about the oven the guest is asking about without ever having been there.”

Enter agentic AI

Since the start of this year, Urban Rest has been adding agentic AI into that mix. It was one of the first Beta customers in Australia to roll out Agentforce.

“Sometimes the question from the guest is really easy, but actually finding the answer is really complex: ‘the oven is not turning on, what do I do?’. If you were staying in a hotel, somebody would go, ‘I’ll walk with you to turn it on.’ Whereas in our model, that doesn’t work, because there isn’t somebody [a service rep] in the property. So that’s where we started,” says Baars.

“We created an initial agent called Urban Assist that effectively takes the data of the inbound call, or the text, links that to the booking to look up where that guest is staying, the appliances we have in that particular apartment – and then reads the instruction manuals of that appliance.

“It then either provides the answer directly to the guest – if the guest connects with us via text message or whatever – or to the relations agent on their screen so they literally have that answer in front of them.”

He says it took “about four to five weeks” to get the agent up and running in January this year. “But that was because everyone was still learning how the hell Agentforce worked.”

The upshot is that guests can truly self-serve, “which they never could before … and we are really focused on growing that because [whereas] currently about 20 per cent of our guests self-serve, we think most guests actually would like to self-serve.

“Now we are more confident with what AI can do for us, we are really expanding that,” says Baars. 

“We see a lot of opportunity in general: making our sales team members more efficient; we see opportunity in revenue management, so selling and pricing based on market and those kind of things.”

One example of bringing AI into pricing is so that corporate clients contracted on set rates are recognised more quickly, “so the AI is able to recognise that you work for Apple, and therefore your pricing should be x, not y”, says Baars.

Urban Rest has also plugged unit availability into the Salesforce stack and is about to start using Agentforce to advise guests on where they can stay based on preferences, dates and availabilities. 

“So, ‘I’m coming to Sydney, need pet friendly, want to be eastern suburbs and I’m looking for 30 days’. Currently that’s our reservation agents providing that assistance, but when we launch in December, Agentforce can do that … it can become a personal concierge.” 

Agentic voice: not yet

From a customer service perspective, Baars says it’s now trialling agentic AI “in all channels except for voice.” 

While much of the tech industry and its integrators are expecting huge growth in conversational commerce, Baars suggests it’s not quite up to scratch for Urban Rest’s purposes.

“Having interacted with AI on voice several times I’m not convinced that voice is there yet in general,” he says. “I’m not opposed to it, and we might trial it in coming months and years. But for now, we’re keeping it focused on all other channels except for voice.”

Paul McIntyre travelled to Dreamforce as a guest of Salesforce.