Gateway Apartments on the Tsim Sha Tsui waterfront is a proven performer for developer Wharf Holdings, in an economic climate where serviced apartments make for better investments than, say, either commercial or residential real estate. The apartments, which have been opening in phases since 1999, have enjoyed a consistent occupancy rate of more than 80 per cent, peaking at 90 per cent last year. Even at the height of the Sars outbreak earlier this year, occupancy held its own at 70 per cent, a far cry from the single-digit figures reported by some hotels. Doreen Lee, executive director of Wharf Estates, puts the firm's successful formula down to its original research into what the upmarket renting public wants in accommodation. Savvy executives may haggle their way down when it comes to leasing office space, but they are not prepared to compromise on their living environment. 'People do realise the premium they have to pay for making better lifestyle choices,' Ms Lee says. Even though the investment return per square foot had dropped before the Sars outbreak (in fact, it has been falling steadily since the building opened), Ms Lee remains philosophical, saying the company is pleased with the results. 'We opened at a time when the market was very good, and we priced ourselves at HK$50 to $60 per square foot,' she says. 'Even though the market is still good now, we are more aware of price movements. We are now at about $40 per square foot. 'Everybody has been experiencing this, and our competitors have also been dropping their price. It is a matter of market force. You cannot expect to maintain a price difference that is way beyond what the market can deliver.' Before embarking on the development, Wharf identified a market for serviced apartments of superior quality to those that had been available before. It went ahead and experienced an 'overwhelming response' to each new stage of the Gateway Apartments' release. People liked the waterfront location, the five-star hotel service, and the convenience of living next door to Hong Kong's biggest shopping mall, Harbour City. 'Traditionally, people rarely saw a maid at serviced apartments. And there was just one person at the front of house,' Ms Lee said. 'We added a hotel flavour. We have a very good concierge who greets everyone, and we brand ourselves differently. This has paid off. And we hardly ever advertise. It is mostly by word of mouth, and also because we have worked to build strong corporate relationships.' But then, more competition came on line as other developers followed the trend. Supply increased and the gap narrowed. Hong Kong was not immune to the global economic downturn, and rentals were affected accordingly. When Sars struck earlier this year, Wharf responded immediately. Even before anybody knew what Sars was about, Ms Lee says, Wharf made an extra effort to make people feel safe and cared for. Not one staff member had to be laid off as a result of Sars. Indeed, Wharf mobilised more staff for cleaning and household duties. Lift and escalator areas were cleaned more frequently, 'hygiene stations' were set up in strategic places where people could disinfect their hands, and individual sets of cleaning tools were purchased for each of Gateway's 499 apartments. These measures will stay in place. Wharf has collected 300 press clippings about its hygiene initiatives during Sars, with photo images used around the world. 'Many sang the praises of our efforts, as we were doing many things that had not been thought of before,' Ms Lee says. While occupancy is still at about the 70 per cent mark, Ms Lee expects the figure to be back in the 80s within two months. Special promotional packages are being arranged for this month and next - traditionally slow periods - to help lure customers back. 'A lot of people have been calling, saying they are sorry about postponing [visiting Hong Kong] but that things will soon be back to normal.'