A Life of Luxuries: Branded Residences Raise the Standards in Property Markets Around the Globe
Branded residences are luxury homes associated to a premium brand that offer high quality levels of service, prestige and recognition. The traditional model is a hotel led development that includes integrated or closely linked residences. Branded residences offer all the benefits of a premium hotel such as quality, management and luxury services. In essence, this provides the comfort and permanence of a home but includes all the luxuries of a five-star hotel. For leading hotelier brands, residences offer a new way to strengthen the relationship with consumers and the opportunity for product diversification and brand enhancement. The signature hotel experience is now a way of life.
Branded residences are proven to be successful in both mature and saturated markets such as North America and from a more localised level, as a single city in Dubai. It has come down to the fact that developers and promoters have a need to differentiate when competition is fierce. The advantage of introducing a world renowned luxury brand is the instantaneous recognition and high level of respect that ensues.
It is clear that the world is becoming increasingly design conscious and brand aware. We talk about appealing to ‘a tribe’ of like-minded people who want to live and socialise with others to whom they share things in common. When buyers see marketing for a Dorchester Collection, SLS, EDITION or Langham residence, they know that they’re going to get a quality product.
Branded residences add value in both supply and demand. A hotel offering residences can significantly increase project visibility and enhance areas with limited residential identity or services. Brand involvement has had a massive influence on property markets, producing price premiums that reach up to as much as 132% compared to non branded luxury offerings in the same area. An example of this is One Palm, at Palm Jumeirah, Dubai which is serviced by Dorchester Collection. It has recently sold the most expensive penthouse in Dubai priced at AED73 million.
In terms of growth areas – there has been substantial expansion in the Asian market which accounts for 30% of branded residence schemes. There is also space in less competitive residential markets such as Europe where the concept is just startng to gain traction. When residential markets become increasingly competitive, branded residences are projected to proliferate, across all continents, developers, hotel groups and investors will continue to capitalise on this prosperous opportunity.
For the high net worth individual the advantages of buying into a home that caters to an exclusive lifestyle are obvious. Hotels with branded residences are forever re-investing and maintaining their brands. Naturally this includes the continuous consideration of building maintenance and management, service provision and physical amenities, and a higher level of overall home security and personal safety.
It is the extra residents’ services that offer investors the opportunity to preserve their most precious commodity – time. With a full hospitality offering, investors know that the day-to-day necessities are taken care of, be it concierge facilities, housekeeping, or room service. This level of attention, service and care is the cornerstone to a lavish lifestyle, which is why branded residences have become so incredibly attractive.
From Central America to China branded residences are prevalent in most major cities and holiday destinations. Traditionally it has been the major hotel brands that dominate. However, it is becoming more common for smaller hotelier groups and boutique luxury brands outside of hospitality to enter the market. This adds a new dimension to the model, placing the emphasis on direct association rather than a proven service record.
As well as reaching into new territories, hotel developers are attempting to expand their customer base. With demand for more affordable offerings catering to millennials, who are seeking a well rounded experience for their children. To cater for multi-generational investors resorts will be required to push their capabilities and ethos even further: by being far more holistic in their approach, including more eco-focussed designs and operations, beautiful gardens and the consideration of wellness facilities.
The hospitality industry has gone very much from the tangible to the emotional. Which is to say that Italian marble kitchens, bigger swimming pools and gyms are to be expected. The focus for the future will see differentiation of offerings increase, as brands look to add value through experiences, along with their signature services and facilities. It is about creating an emotional link through lasting memories: providing world class experiences through dining, entertainment and adventure.
The increasing popularity for branded residences creates the necessity of differentiation for success. In an industry of experienced developers and brands that are continuously raising the bar – with better facilities, high quality ecoconscious technology, and more unforgettable experiences – standing out from the crowd is more important than ever.