The Rise of the ‘On-Brand’ Residence

Taking the luxury living experience to a whole new level, branded residences are one of the hottest prospects in the real estate market at present. But are they truly worth the ­five-star price tag? By Stephen Penn

Whether its haute-couture fashion, the latest limited-edition sports car or made-to-measure super yacht; putting a reputable name behind a product infers a core brand value and guarantee of excellence.

Storytelling is an important part of that journey, and never more so than with something as expensive as real estate. Property marketing must speak to the client’s expectations of lifestyle and experience. Which perhaps makes the rise and rise of the branded residence an entirely understandable trend in the current acquisition minded climate.

While the first branded residences concept appeared in New York in the 1920s, it wasn’t until the 1980s that demand began to gather pace, both in the USA and further afield. Now, the drive to ‘move in’ with some of the biggest luxury labels is at an all-time high, with the best-known elite hotel brands getting behind the pied-a-terre with benefits movement to create sought-after residential opportunities across the globe.

“Buy into a reputable brand and you have the assurance in the delivery and quality of the development as well as professional management,” says Chris Graham of consultancy Graham Associates. “The best products offer prime locations, likeminded neighbours, cutting-edge interior design and, crucially, stronger resale values and higher rental income.”

“They’re a form of trophy purchase rather like collecting expensive art,” adds Robert Green of Sphere Estates. “As such, the quality, range and potential of the branded residence has huge potential to evolve.” Other companies jumping on the ‘brandwagon’ include luxury fashion houses Armani, Versace and Missoni.

Porsche Design Tower has its luxury residences in Miami while Mercedes-Benz’s ‘Living @ Fraser’ partnership is offering branded serviced apartments in London and Singapore. Not surprisingly, properties carry significant price premiums - up to 44% over the top end of the local market, according to Savills.

“The exact uplift is dependent on developers building a quality product in the right location, with the right design and brand,” says Rod Taylor, head of international development sales at Savills. It’s a movement however, that for now, shows little sign of waning.

Despite this overwhelming success across the globe for these elite brands, the sector isn’t immune to risks. During the US electoral campaign, Trump branded residences experienced a fall in their piece premium, a scenario that continues to play out in the light of some of his more radical policies.

Such issues however, seem few and far between with experts predicting the emergence of new destinations, notably in South America and sub-Saharan Africa – with a growing presence across Europe.

It’s a growth that’s coming not only from the extravagance that such high-end brands exude, but also the convenience of having a home that’s entirely taken care of – featuring all essential mod-cons, concierge services and, most importantly, high levels of security that come from choosing a home with a big name.