According to C9 Hotelworks, a well-known hospitality consultancy in Asia, the market value of branded residential projects in Asia has reached a record high of US$26.6 billion ($35.5 billion). This is attributed to the availability of more than 68,000 luxury units in the market.
Leading the way in Asia is Vietnam, with a total of 17,680 branded residential units across 59 properties. The average price per square foot (psf) of a branded residential unit in Vietnam is about US$350. In second place is Thailand, with 16,271 branded residential units across 65 properties. The average price of a branded residential unit in Thailand is US$510 psf. The Philippines follows closely behind with 13,276 units across 46 properties, priced at US$400 psf.
In terms of pricing, however, Singapore comes out on top with the highest prices for branded residences in Asia, at US$2,140 psf. This is followed by Japan, where the average price of a branded residential unit is about US$1,935 psf.
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Aside from these established markets, C9 Hotelworks also reports that there has been a rapid growth of branded residences in South Korea, with 3,026 units across 16 properties, and Malaysia, with 6,014 units across 24 projects.
In the post-Covid-19 era, urban-locale branded residences make up 56% of the total supply in Asia. These luxury urban projects command high market values and prices, with branded residences in urban areas of South Korea priced at US$2,670 psf compared to resort projects, which typically sell for US$1,040 psf.
Similarly in Thailand, urban branded residences fetch about US$770 psf compared to US$430 psf in resort locations. In total, the branded residential market in Asia includes approximately 12,330 units across 80 developments affiliated with luxury hotel brands, making up 31% of the total market supply.
According to Bill Barnett, managing director of C9 Hotelworks, a well-known brand can help a property command premium pricing of 30%-35% above the market rate in the country and increase the developer’s market share. In the competitive luxury market, the appeal of top hospitality brands and other luxury lifestyle brands has led to an increase in licensing fees, with luxury hotel and lifestyle brands now demanding a 6%-10% cut in the sale of each branded residential unit.
This trend has resulted in notable collaborations between luxury brands and developers in the region. One such example is the ultra-luxury Porsche Design Tower Bangkok in Thonglor, a 22-unit tower jointly developed by Thai developer Ananda Development and German automaker Porsche through its lifestyle brand Porsche Design. The development, expected to be completed by 2028, offers duplexes and quadplexes with prices ranging from US$15 million to US$40 million.
Gianfranco Bianchi, general manager of Asia Pacific at The One Atelier, a design consultancy specializing in branded residences for luxury lifestyle brands, has also noted the rise in partnerships between luxury brands and developers in the Asia Pacific region. The One Atelier has collaborated with high-profile brands to create branded residences such as Fendi Casa Residences by Armani in Miami, Dolce & Gabbana’s 888 Brickell in Miami, Büyükyalı Residences in Istanbul, Turkey, and the Karl Lagerfeld Villas in Marbella, Spain.
In addition to hospitality-affiliated branded residences, luxury lifestyle brands also offer a rare investment opportunity, with trophy homes that embody the brand’s design and luxury aesthetic, making such properties highly desirable to buyers.
Ananth Ramchandran, head of advisory and strategic transactions in hotels and hospitality for Asia at CBRE, notes that the implementation of property cooling measures has led to a significant reduction in inquiries from Singapore developers interested in venturing into the high-end ultra-luxury branded residential market. In contrast, more high-net-worth Singapore-based buyers have been looking at luxury-branded residences in destinations like Phuket and Bangkok in Thailand, Bali in Indonesia, and emerging markets in Vietnam, all within a two-hour flight from Singapore. As a result, these locations have become the top destinations for Singapore-based buyers looking for second homes, accounting for over 45% of regional purchases.
With the increased demand for branded residences in Southeast Asia, hospitality operators such as The Ascott have also been tapping into the growth potential of the branded residential segment. Saowarin Chanprakaisi, vice-president of business development at The Ascott, notes that the company’s brands, including Ascott, The Crest Collection, and Oakwood Premier, have a competitive advantage in the market due to their strong reputations for luxury and impeccable service. In addition, Ascott is looking to expand its market share in the region by partnering with developers keen on entering the branded residential market.
In conclusion, as the demand for branded residences in Asia continues to grow, there is an increasing emphasis on the value of a reputable brand in enhancing the market value of luxury properties and driving sales. This trend has led to more collaborations between luxury brands and developers, resulting in a competitive and dynamic market for branded residences in the region.