Resicom – Holiday Investment – 04-21 – LB

Branded Residential Buildings Demand International Premium

International property Buyers can expect to pay a premium to live in a branded residential building around the world, according to a report from Savills.

For example, overseas property investors looking to buy in Miami’s Porsche Design Tower or New York’s Baccarat Residences can expect to pay an average premium of 31 per cent for the privilege of living there.

There are over 400 such residence schemes around the globe, which accounts for 55,000 of this type of residential unit. The largest percentage of these can be found in the United States of America where 32 per cent of branded buildings worldwide are found.

The largest price premiums for these residential buildings are generally achieved in emerging markets. This is because owning a branded property in these markets is seen as both a status symbol but also a stable investment. The most significant markups are seen in Bangkok, with buyers paying over 60 per cent more for the developments in comparison to their non-branded residential counterpart.

In Dubai, the premium is 38 per cent and in Miami it is 32 per cent. Lower premiums are found in better established luxury markets where it can be guaranteed that property is reliable. For example, buyers in London can expect to pay a premium of just 8 per cent. In New York, there is a discount of 15 per cent.

Hotel brands dominate the branded residential market. 85 per cent of branded developments worldwide are hotels, however fashion houses and car brands have also integrated into the sector. However, the largest individual brand is Yoo, a design firm with 50 different residential projects.

Head of international development consultancy at Savills, Riyan Itani, says: ‘Cash-rich, time-poor, brand-conscious individuals are attracted by the quality of design, security and high levels of service that branded residences offer.’

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