Buying a Branded Residence
It’s crucial to realise that property developers constructing branded residences invest a significant amount of time, money, and effort into the planning process. Luxury hotel operators and exclusive non-hospitality brands don’t simply allow their brand to be used without thorough research on the developer and the project itself before approval. The effort put into planning a branded residence far exceeds that of a non-branded product.
Buyers can rest assured that the developer is fully dedicated to the project. This is especially important for real estate buyers purchasing off-plan. While there are no guarantees, buyers can trust that a developer who has undergone rigorous planning and due diligence is committed to delivering a top-notch property.
So, the first reason of my five reasons to buy a branded residence is that you’re investing in something with a solid reputation and credibility.
BRAND STANDARDS AND QUALITY
When developing a real estate project with a renowned brand, the developer must adhere to the brand’s specific standards. For instance, if the project is associated with JW Marriott Residences, Marriott International’s team will oversee that the project meets all the requirements of a JW Marriott hotel, from construction quality to amenities and overall living experience.
The brand’s technical, design, and operational teams will collaborate with the developer from the initial planning stages to the final handover of the property.
In the case of hotel-branded residences, the brand will continue to manage and operate the project to maintain its high standards.
SERVICES AND FACILITIES
I previously discussed the importance of brand standards in relation to service and facilities. Branded residences are anticipated to provide superior service and facilities compared to non-branded projects. These are luxury homes, so excellence is to be expected.
The range of facilities offered will vary depending on the brand, but property owners can anticipate a wide selection including Bars and Restaurants, VIP Owner Lounges, Butlers, Concierge, Wellness & Fitness Zones, Swimming Pools, and Fully Maintained Communal Areas.
Customised services such as dog walking, shopping, private chefs, party planning, housekeeping, and laundry services are commonly found in most developments.
Rooms and apartments are typically designed and furnished to the highest standards.
Even if a property is not fully furnished, buyers can still expect amazing world class kitchens, bathrooms, and materials, with the option to have a designer customize the home to their preferences.
VIP STATUS
When you invest in a branded residence, you are highly esteemed and anticipate receiving VIP treatment from both the developer and the brand partner.
Owners of hotel-managed residences typically receive elite status in the hotel’s rewards program. For instance, Marriott International offers residential property owners enrollment in Onvia, granting them a wide range of exclusive benefits, including elevated Marriott Bonvoy Loyalty Status, by owning a Marriott Residence as detailed below.
“Today, I am pleased to share the launch of our new Owner Recognition Platform, ONVIA. ONVIA is designed to elevate experiences for Residence Owners, whether they are traveling in one of our hotels, taking in the views while aboard a voyage from The Ritz-Carlton Yacht Collection, or enjoying their day-to-day life while in Residence. We recognise that our residence owners are not only purchasing a unique and beautiful home, they are also buying into a lifestyle and brand promise. With 135 total open and 121 pipeline residential projects across 48 countries and territories, Marriott remains the global leader in the branded residential segment and ONVIA will continue to recognise our residence owners as our most loyal customers.” John Hearns Senior Vice President Global Residential Operations Marriott International
Although Marriott was mentioned in the earlier example, homeowners of alternative brands like Accor Residences, Rosewood Hotels, etc., are also granted elevated status.
For individuals who own a property associated with a non-hospitality brand such as FENDI, Aston Martin, Elie Saab, etc., ownership perks and incentives will be tailored to the specific project. Nevertheless, ownership will continue to provide VIP privileges, top-notch design, amenities, and service.
HIGHER ROI
The situation becomes intriguing and highly dependent on the project and location. Recent research and data indicate that branded residences in prime areas like Dubai, London, Miami, and New York offer rental returns approximately 1-3% higher per annum compared to non-branded developments.
Moreover, if you are buying a second home and plan to use the property for only 4-6 weeks annually, many projects provide annual rental guarantees or profit-sharing options. Homeowners can lease the property back to the operator, who includes the room in their inventory and manages it like any other hotel room under their supervision.
Investing in a branded residence is likely to yield a better return on investment if you have this objective in mind. However, there are no absolute assurances, and as mentioned earlier, outcomes can vary based on location, project specifics, and changing circumstances.
CAPITAL APPRECIATION
Branded Residences represent exclusive properties that are typically professionally managed, offering the potential for owning a luxurious home and the opportunity for capital growth.
I will use a real life example of this.
In 2015, a friend and client from the UK approached me to conduct due diligence on Four Seasons Residences in Bangkok. Despite not being a property broker, I agreed to assist due to my expertise in the sector and my presence in Bangkok at the time.
Upon evaluating the project, it was evident that it would be a top-tier product, leading him to make an “off plan” purchase. Several years later, he took possession of his unit. At that juncture, resales in the project were around 25% higher than his original purchase price for the same room type.
Subsequently, he opted to rent out the property and enjoyed a rental return of approximately 6% per annum for two years before deciding to sell. Upon selling, he managed to secure a 35% premium over his initial “off plan” purchase price.
While this is a specific case and not all projects may yield such success, there are instances where projects may offer even greater capital appreciation, as seen across the globe.
In conclusion, I believe that buying a branded residence with a reputable management brand that upholds the highest standards in development, facilities, communal areas, and rooms should result in expected capital appreciation.
SUMMARY
So here are my top “five reasons to buy a branded residence”
In truth, I have outlined numerous benefits of buying a branded residence, in excess of 5 reasons. I trust that this information will enhance your understanding and the opportunities provided by buying a branded residence
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Jason Payne, the CEO and Founder of BRESI, authored this article. With over a decade of experience in the branded residences sector, Jason also owns BR ASIA, a consultancy firm that specialises in assisting developers with planning and developing branded residences.
This article five reasons to buy a branded residence is for informational purposes only. BRESI claims no copyright to any of the images used.
BRESI serves as a dedicated platform for marketing branded residences, and showcasing the most exclusive real estate projects from around the globe. Buy and Sell the worlds best luxury international branded real estate
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