---
title: "The Residence Trap: Why Great Construction Won't Save Your Returns"
description: "How should you run a residence to actually make money? We asked an expert who's seen it all."
published: 2023-03-16T00:00:00+00:00
author: "ONDA 편집팀"
category: "Insights"
image: "https://zqcfqfqgiyckyhazcfrk.supabase.co/storage/v1/object/public/blog-images/webflow/6316f3f75130788ec2d762dd/641284fefe3be0d882908804_3.jpg"
canonical: https://global.onda.me/en/blog?slug=interview-2303-8
locale: en
---
# The Residence Trap: Why Great Construction Won't Save Your Returns

Hi, we're ONDA — building the digital backbone for Korea's hospitality industry.

Last time we talked to Song Min-jun from ONDA Management about running pensions like a pro.

This time? We're diving into **serviced residences** — what it really takes to make them profitable.

Let's get into it.

> **Hi, Min-jun! ONDA has a whole division focused on residences.  
> What does the Residential Lodging Division actually do?**

Hey — I'm Song Min-jun.

I lead solution planning for ONDA's Residential Lodging Division, and I'm also CEO of Wassong Co., which operates properties in Gangwon-do under ONDA's management model.

**ONDA's Residential Lodging Division provides custom solutions — like hotel-grade operating systems — tailored for serviced residences.**

> **Residences are popular as income-generating real estate. Why do investors like them?**

**First: versatility.**

Residences are built for extended stays, but you can pivot to short-term bookings depending on demand.

And unlike office-tels, you can outsource operations *and* still use the unit yourself whenever you want. Earn passive income and keep access — that's a big deal.

**Second: lower entry cost.**

Yes, new-build residence prices have climbed recently. But you can still pick up units well below market rate in certain areas.

If you target regions with strong occupancy rates, residences are a smart play — especially in today's regulatory environment.

![](https://zqcfqfqgiyckyhazcfrk.supabase.co/storage/v1/object/public/blog-images/webflow/6316f3f75130788ec2d762dd/64128504efe3888527ad08a1_4.jpg)

> **How do you actually run a residence to maximize returns?**

**Start with a trustworthy operator. That's table stakes.**

Average yields on Seoul-area office-tels sit around 4–5%.

But when I talk to residence investors, most expect 8–10% returns.

Sure, that's possible in some regions — but operators who *promise* those numbers? Almost none deliver.

So if a sales agent or management company is pitching unrealistic yields, dig deeper before you sign.

**Profitable residences match their concept to the local market and adapt to shifting guest preferences with differentiated service.**

Cutting costs with contactless systems is fine — but the real edge comes from **smart marketing and guest experience design that drives repeat bookings.**

> **What's the biggest operational pain point residence owners mention?**

Like I said, a lot of residences have gone contactless.

**But most of those systems are half-baked.**

They make *operations* easier for the owner, but guests get stuck with check-in/check-out tools that don't let them communicate with staff. That kills repeat rates.

And if one building has multiple operators? Guest service becomes a mess.

The root cause? **Operators optimizing for profit over service.**

![](https://zqcfqfqgiyckyhazcfrk.supabase.co/storage/v1/object/public/blog-images/webflow/6316f3f75130788ec2d762dd/6412851457ba18892c25e925_5.jpg)

> **People say the operator matters more than the builder.  
> Why should residence owners work with ONDA specifically?**

A lot of investors do pick residences based on the construction company. Fair enough — quality matters.

**But residences are income assets. How you manage a well-built property matters more than the build itself.**

ONDA is a hospitality tech company built on years of big data. **We know what guests want and what investors need better than anyone.**

That insight powers the ONDA solution suite.

**We're not just doing check-in/check-out. We've built contactless systems that replace dozens of staff efficiently, plus transparent operations that keep everyone happy. You won't find that anywhere else.**

> **Where should the residence market go from here?**

The Korean Wave has created massive latent demand for Korea tourism.

Operators who can capture inbound travelers early will see dramatically better performance.

Residences are hybrid products — they flex between short-term and long-term stays. If you tailor your offering to local demand, you can outperform traditional hotels.

But only if owners stay committed and operators stay transparent.

**ONDA is here to be that partner — for residence success.**

That's it from Song Min-jun — his take on where the residence market stands and where it's headed.

**Interested in residences? Not sure who to trust with operations? Talk to ONDA.**

**Our hospitality experts will help you run a profitable property.**

#### **Experience hands-on operations that actually drive revenue.**

[Get in touch](https://www.onda.me/sales?utm_source=home&utm_medium=trend&utm_campaign=interview&utm_content=2303_8_cta)