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Is Luxury Housing All About the Brand?

Thu Jan 27, 2022 on Florida Real Estate

Is Luxury Housing All About the Brand?

“Branded” housing is definitely in vogue in South Florida. In the luxury residential real estate market, purchasers seek brand names such as Ritz Carlton, Four Seasons, Porsche, and Aston Martin as they consider homes.   The number of hotel branded residences, for example, doubled from 2010 and 2020. Why? Such high-end residences provide an array of services, ranging from spas to golf and restaurants, which this market seeks.

Picture courtesy Porsche Design Tower

This luxury market ranges from $4.5 million for a two bedroom unit at the Four Seasons in Ft. Lauderdale of which is already 90% sold, to over $20 million at the Mandarin Oriental in Boca.

Branding pulls potential purchasers to South Florida as it attracts global purchasers who are familiar with the brand. Residents who purchase at this level trust management within the brand (like the Four Seasons, for example) than a building’s elected condo board. Plus, the condo owners who buy a unit at a hotel use the food, beverage, and concierge services that guests ordinarily receive at a hotel. David Warne, chief-operating officer of Penn-Florida, the developer of the Mandarin Oriental in Boca, stated, “When you have a branded condominium adjacent to a hotel you can complement it with high end service:  turn down service, housekeeping, bar service, and wine storage…”

Picture courtesy Mandarin Oriental

Developers tend to believe that brands expedite sales over unbranded properties since potential purchasers know what they are to expect from the prominent brand. The Waldorf Astoria which is building residences in Miami and is expected to be completed in 2026 is already 70% sold.

As to whether a buyer would be more attracted to a residence affiliated with a hotel versus a car brand is debatable. Many may prefer a hotel brand, as they can envision the level of food, concierge, spa, and maid service; yet others may be more affiliated with a car brand.

What does all this mean?

Picture courtesy Four Seasons

While there is a shortage of affordable housing, the luxury market is stronger than ever.  Branded content is creating a niche in this market, as purchasers seek turn-key living arrangements where services are incorporated into their lifestyle.  Elevated service is sought, and demand for such services is considerable.  More and more purchasers are looking to South Florida for branded real estate communities.

Roy Oppenheim

From The Trenches

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