BRANDED RESIDENCES THE INSIDER’S VIEW
Asian Property Review talks to Chris Graham (Founder and MD of Graham Associates), who is regarded as one of the world’s foremost specialists on branded residences.
- Does the shift of consumer preference for more independence through branded serviced apartment spell the beginning of the demise for the pure stand-alone hotel set-up?
There will always be strong demand for stand-alone hotels. Whilst branded residences and serviced apartments certainly add to the range of accommodation choices available to travellers, in reality these still represent a relatively small percentage of the market. In many cases – notably prime urban locations – the lack of availability and the high cost of land are key factors that can inhibit the opportunities to include a branded residential component alongside a hotel. Many travellers seeking greater independence are of course turning to AirBnB – although currently most branded operators do not permit their homeowners to use this platform to rent out their residences, which must instead be put into the operator’s managed rental programme.
- Apart from concierge and butler services, celebrity or Michelin chef restaurants, in-house cinemas, branded spas, golf simulator, wine storage, award-winning designers and even starchitects, what other distinctive services or characteristics mark the branded service residence?
There is a long list of facilities and services that developers are incorporating in their branded residences (including those listed above). In addition, there is the convenience of owning a “lock up and go” home, that will be kept secure and professionally maintained – and possibly earn valuable income – when the owner is not in residence.
Above all, rather than simply providing more 5*+ facilities, the focus is more about creating a personal and emotional engagement with customers. Some leading branded residences designers such as Luciano Mazza at HKS and John Hitchcox at YOO talk about creating “modern day communities” of like-minded people – a sort of exclusive residents club. Whilst buyers’ priorities remain consistent in terms of location, design and access to world-class amenities, very much in line with trends in the hospitality sector, it is increasingly more about the intangible ‘added value’ lifestyle benefits associated with a brand. Increasingly, the shift is towards creating an emotional connection with residents through experiences.
- What are the most common challenges faced by developers when building a branded residence?
There are innumerable challenges that a developer faces and every project brings its own unique set. I would say generally that securing the best locations and ensuring that branded residences are designed for the local marketplace rank quite high. On this second point, most branded operators have rigid guidelines about FF&E, room sizes and facilities so in some cases these may, for example, require that units will be too large – and therefore expensive – for the local market, when priced on a per sq m basis. Many developers today will appoint an operator once the design concept for the residences is already well developed, so marrying up the design to the brand guidelines in such circumstances can be an issue. Another challenge is financial – notably achieving sufficient off-plan pre-sales, since construction is often only triggered once a specified number of units has been sold.