Living in a five-star hotel: Why private residences are the future of luxury homes in Asia – led by Bangkok and Dubai
Residential developments offering the facilities of five-star hotels are springing up across the Asia-Pacific, with hot new openings including Bangkok’s Residences at Mandarin Oriental, the Langham Residences, Jakarta, and Phuket’s Skypark by Banyan Tree
North America might have been the birthplace of the branded residence concept, accounting for 40 per cent of completed schemes, but Asia-Pacific is home to most upcoming supply.
A new report from Savills World Research says the Asia-Pacific, led by Thailand and Vietnam, has 23 per cent of the global pipeline either in planning or under construction, followed by the Middle East and North Africa region at 21 per cent, where the United Arab Emirates and Egypt account for most of the forthcoming supply.
Latin America is another major growth market. Savills finds that the number of schemes in Mexico is set to more than double in the coming years, as brands like Marriott International, Accor and Hyatt open new projects in resort and city locations.
In 2019, a record number of schemes opened, delivering more than 9,000 additional branded residences across 21 nations. This record is set to be broken again in 2020 when nearly 70 projects will complete.
According to Riyan Itani, director and co-head of Savills International Development Consultancy, branded residences offer many advantages in a crowded global marketplace for luxury property.
“Globally-mobile, brand conscious, wealthy individuals are attracted by quality design, security and the level of service branded residences offer,” he explains. “For hotel operators, adding a residential component can improve income streams with royalty fees from sales in the early stages and a more diversified hospitality inventory, while also allowing them to be more competitive when pitching for new projects. Developers, meanwhile, have come to recognise the value-add of a brand in a competitive global marketplace.”
Branding a residential development lends a point of difference that will become ever more important in challenging market conditions, Itani continues. “Last year, we predicted that new lifestyle, non-hotel brands, outside the realm of what has been seen to date, would enter the sector. Our prediction has played out: media company Condé Nast has plans to move into the branded residence sector. This, together with rapidly rising participation by hoteliers including Hyatt, Hilton and Accor underscores the depth of the sector’s potential in the years to come.”