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Branded residences vs non-branded properties: Experts weigh in

Branded residences are forecasted to continue their growth worldwide on the back of the exclusivity and security offered by such properties

Branded residences vs non-branded properties: Experts weigh in

According to research conducted by Global Branded Residences (GBR), North America is currently leading the way in branded residences with 35 per cent of projects, followed by Asia Pacific at 23 per cent and Europe at 16 per cent. CALA and MENA each stand at 13 per cent and 12 per cent, with Africa at one per cent.

However, the pipeline of projects shows a shift in rankings, with MENA and CALA expected to have the largest proportion of new projects at 24 per cent and 21 per cent respectively with Dubai and Saudi Arabia leading in MENA, and Mexico taking the lead in CALA. Asia Pacific will see 20 per cent of the pipeline, with a focus on Thailand and Vietnam while North America and Europe will have 18 per cent and 16 per cent of the development pipeline, respectively.

So, with the sector due to almost double in size over the forecast period with new and exciting brands entering the market, and projects being delivered in new territories, the future only looks extremely promising. However, does owning a branded home offer distinct benefits over a non-branded one, or is the higher price tag solely due to the brand name? Let’s understand.

What separates the two?

Branded residences are associated with well-known hospitality brands, fashion houses, and luxury automobile companies, offering a level of prestige and exclusivity. These properties often adhere to the brand’s high standards in terms of quality, service, range of amenities, and design, and provide access to exclusive additional benefits offered by the brand while non-branded residences are essentially independent properties or developments that lack a specific brand affiliation.

In today’s market, demand varies between non-branded and branded residences primarily due to differences in consumer preferences, financial capabilities, and value perception.

“For non-branded residences, the typical market consists of investors and home buyers who seek high-quality living spaces with excellent facilities and lifestyle offerings but at a more accessible price point. These consumers prioritise the property’s intrinsic value and practical benefits, such as lower service charges, higher potential rental yields, and flexibility in customisation,” explains Sahil Khosla, CEO of SOHO Development.

He continues, “In contrast, branded residences attract a market segment that values exclusivity and prestige associated with renowned brand names. These buyers are enticed by the luxury amenities and a suite of tailored services that a recognised brand provides.”

Today, both, branded and non-branded residences are focusing on providing luxurious living environments, however, branded residences tend to offer a range of amenities and services that are not typically found in non-branded properties.

“Branded residences offer exclusive perks such as access to a global network, round-the-clock concierge services, an on-site spa and fitness centre, dining options, and room service. Additional benefits include housekeeping, maintenance, and laundry services, allowing residents to focus on enjoying their space without the hassle of chores. It also offers a high level of safety and exclusivity, with 24/7 security and special events for residents. Moreover, collaboration with renowned designers ensures luxurious and well-designed spaces that reflect the brand’s identity and values, raising the living experience to a more aesthetically pleasing and comfortable level,” explains Ravi Bhirani, Managing Director of ANAX Developments.

Let’s talk money

For the end-user of branded residences, the benefits can vary depending on their motivation for purchase. For ‘lifestyle’ buyers the residences represent a sense of prestige, benefiting from the brand association. For ‘investment-driven’ purchasers, the residences provide a professionally managed product that is suitable to lock-up and leave.

Riyan Itani, Founder and Director of Global Branded Residences explains what’s driving buyers towards branded residences and why developers too are attracted to this segment. “For buyers, branded residences tend to hold their value (capital value) in resale (adjusting for inflation) compared to non-branded products that will tend to date faster and be surpassed by newer, better amenitised non-branded projects in the same market.”

He further goes on to add, “Globally, branded residences typically achieve a 30 per cent premium in sales compared to non-branded properties. This premium can vary greatly depending on the location, with some major cities seeing as low as a five-10 per cent premium due to similar services and amenities offered by non-branded properties. In contrast, emerging global markets may witness premiums of over 100 per cent as non-branded options are limited in their offerings and quality. The presence of services like concierge, gym, valet parking, and spa can significantly impact the perceived value and premium of branded residences.”

Increased sales velocities are also a major draw in developing branded projects—especially at an off-plan level. After all, buyers are well aware that a brand or an operator would not associate their name with a project unless they were sure it would be delivered on time and to the highest standards.

What lies ahead?

According to experts, moving forward we will see a growing diversification in both branded and non-branded residences, responding to evolving consumer preferences and market dynamics.

“Branded residences will likely intensify their partnerships, not only within traditional luxury sectors, but also with lifestyle and wellness brands to cater to a holistic living experience. This evolution will aim to deliver not just a home but a complete lifestyle package that resonates with the identity and aspirations of the buyer,” shares Khosla.

For non-branded residences, the focus will increasingly shift towards offering fully-furnished flats that cater to the busy lifestyles of today’s buyers, who may have less time to personalise their spaces. Additionally, the expectation for amenities will extend beyond the traditional with standard features to include co-working spaces, and zen studios for wellness activities that enhance family time and community engagement.

Last but not the least, sustainability and technology will play crucial roles across both segments. “Eco-friendly practices and smart home technologies will transition from premium add-ons to standard expectations, reflecting a broader commitment to environmental consciousness and modern living conveniences,” concludes Khosla.