By Rebecca Rachel WongData from C9 Hotelworks, a hospitality consultancy based in Asia, has shown that the branded residential market in Asia has reached a record high of US$26.6 billion ($35.5 billion), with over 68,000 luxury units now available.
According to C9 Hotelworks’ data, Vietnam is currently leading Asia in the number of branded residential units with 17,680 units spread across 59 properties. The average price of a branded residential unit in Vietnam is about US$350 per square foot (psf). Trailing behind Vietnam is Thailand with 16,271 units across 65 properties, where the average price of a branded residential unit is about US$510 psf. The Philippines follows closely with 13,276 units across 46 properties, with luxury properties here selling at an average price of US$400 psf.
However, in Singapore, branded residences command the highest prices in the region, with an average of US$2,140 psf. This is followed by Japan, where branded residences are priced at about US$1,935 psf.
“The data also shows the growth of branded residences in new markets in recent years, such as South Korea with 3,026 units across 16 properties, and Malaysia with 6,014 units across 24 projects,” says Bill Barnett, managing director of C9 Hotelworks.
In the post-Covid-19 era, urban-locale branded residences account for 56% of the total supply in Asia. These luxury urban projects dominate the sector in terms of market value. For example, urban branded residences in South Korea are priced at US$2,670 psf, compared to resort projects which typically sell at US$1,040 psf. Similarly, in Thailand, urban branded residences fetch about US$770 psf, compared to US$430 psf for resort locations.
The branded residential market in Asia currently consists of 12,330 units spread across 80 developments that are affiliated with luxury hotel brands, accounting for 31% of the overall market supply. “Our data shows that a reputable brand can help affiliated properties command a premium of 30%-35% on top of the market rate in the country. This can also help developers increase their market share in the country,” explains Barnett.
The appeal of top hospitality and luxury lifestyle brands has also led to an increase in licensing fees, with luxury hotel and lifestyle brands asking for 6% to 10% of the sale value for each branded residential unit, according to Barnett.
Last August, Thai developer Ananda Development and German automaker Porsche, through its lifestyle brand Porsche Design, unveiled the ultra-luxury Porsche Design Tower Bangkok in Thonglor. The 22-unit tower, set to be completed in 2028, is the first Porsche residential tower in Asia, following the Porsche Design Tower Miami that was built a decade ago. It offers duplexes and quadplexes, with prices ranging from US$15 million to US$40 million.
Designs of residences have been high-profile collaborations between luxury brands such as Fendi, Armani, Dolce & Gabbana and Karl Lagerfeld, instead of just hospitality operators (Picture: C9 Hotelworks)
Gianfranco Bianchi, general manager of Asia Pacific at The One Atelier, an international design consultancy specialising in branded residences for luxury lifestyle brands, notes that in recent years, more luxury lifestyle brands have explored partnerships to license their branding into real estate developments across the Asia Pacific region. The One Atelier has partnered with several high-profile luxury brands, including the 28-unit Fendi Casa Residences by Armani in Miami, the 259-unit 888 Brickell by Dolce & Gabbana in Miami, the 90-unit Büyükyalı Residences in Istanbul, Turkey, and Karl Lagerfeld Villas, a collection of five ultra-luxury villas in Marbella, Spain.
While hospitality-affiliated branded residences offer top-notch hospitality services, fashion or design-branded residences offer a rare trophy home that conveys the namesake design and luxury aesthetic that have made such brand names synonymous with luxury lifestyles today, says Bianchi.
Ananth Ramchandran, head of advisory and strategic transactions for hotels and hospitality (Asia) at CBRE, says property cooling measures have led many high-net-worth Singapore-based buyers of branded residences to consider trophy assets in nearby regional markets.
“We’ve experienced a significant decrease in terms of discussion and inquiries from Singapore developers to explore high-end ultra-luxury branded residential projects in Singapore. Developers are discouraged from stepping into this high-end segment because property cooling measures have dampened foreign buyer demand,” he adds.
Singapore-based high-net-worth buyers have also been increasingly looking at luxury-branded residences in destinations such as Phuket and Bangkok in Thailand, Bali in Indonesia, and emerging markets in Vietnam. These locations are typically just a two-hour flight from Singapore.
“The relatively short travel time and availability of regularly scheduled direct flights make it much more appealing to Singapore-based buyers. In the past month, flight carriers like SIA, Scoot, AirAsia and Jetstar completed about 150 flights per week between Singapore and Phuket,” says Ramchandran.
Jason Thelen, senior director of sales and marketing at Sudara Residences, a Thai-based developer, adds: “Singapore has quickly become our top regional market for buyers looking for second homes, making up over 45% of regional purchases.”
Hospitality operators such as The Ascott are also tapping into the future growth of the branded residential segment in Asia, says Saowarin Chanprakaisi, vice-president of business development at The Ascott. “We believe the emotional resonance of our brands, such as Ascott, The Crest Collection and Oakwood Premier, have reputational strengths in the market.”
“Branded residential operators must develop and maintain trust in the brand to deliver the level of service that will eventually translate into the long-term value proposition of the asset,” she says, adding that Ascott is looking to expand its market share in the region by partnering with developers who would like to enter the branded residential market.