Branded residences, the must-have home for high rollers? How five-star hotel brands Mandarin Oriental, St. Regis and Raffles are cashing in with luxury apartments catering to the uber-rich
- Housed in Gucci’s former Manhattan home, the 69-apartment Mandarin Oriental Residences at 685 Fifth Avenue is a stone’s throw from Tiffany & Co., Chanel and Cartier boutiques
- In central London, OWO Residences By Raffles offers buyers access to 30,000 sq ft of amenities, including a 16-seat cinema, gym, valet parking, nine restaurants and three bars
What’s in a name? Quite a bit, it would seem, when it comes to branded residences. Though relatively new to Asia, they occupy a premium niche in residential property worldwide, with data from Knight Frank suggesting that branded residences cost an average of 25 to 35 per cent more than a comparable non-branded home.
Victoria Garrett, head of residential, Asia-Pacific, Knight Frank, says it’s not just the name that makes these properties worth more – the comfort and exclusivity they offer are compelling draws for potential buyers, especially those looking for second homes.
Asian properties already command some of the highest premiums globally with residences at Four Seasons in Kyoto, Japan, going at a 150 per cent premium in 2019 (the latest data available), while at some branded properties in Bangkok, Thailand, the mark-up was as much as 132 per cent.
“Premiums against unbranded luxury residences are generally driven first by the brand connection, as well as the services offered,” Garrett said. “The higher buy price and rental premiums for branded residences can be attributed to their large size and high-end design, as well as exceptional amenities. It is also convenience at a price, as such developments provide owners with personalised concierge services, top-notch hospitality and a full range of housekeeping services.”
Mark Harvey, head of international at Knight Frank, believes the concept of hotel-branded residences is all the more salient in a post-Covid-19 world as high-net-worth individuals aspire to a more personalised and intimate residential offering where they can enjoy privacy with world-class amenities and services, but without the volume of guests one would find in a classic hotel.
He sees a particular uptake of demand in New York – where the first true branded residence, The Sherry-Netherland hotel in Manhattan, opened its doors in 1927 – following the gradual reopening of international travel corridors. Many potential foreign buyers, Harvey believes, have been “waiting in the wings since early 2020”.
“The Manhattan residential market has always attracted a global following, and with the growth of ultra-high-net-worth-individuals set to increase by 25 per cent between 2021 and 2026, demand for such exceptional residences is set to grow significantly in the years to come,” he said.
