Luxury Hotel-Branded Apartments Entice Buyers

Luxury residences attached to five-star hotels have long been a hit with apartment buyers who wanted a place to live with access to hotel services and amenities.

Now, developers are finding that they can sell units at above-market rates for a luxury hotel branded residence, even if there’s no accompanying hotel.

U.K. developer Finchatton transformed the former British headquarters of the U.S. Navy into the Four Seasons Hotels & Resorts’ first stand-alone private residences, featuring 37 homes with sales prices starting at 17.5 million pounds, approx. $33 million.

The project completed construction in London’s Mayfair neighbourhood in 2019. Despite an interruption in sales caused by the pandemic, “only a handful” of units remain unsold, said a spokeswoman for the selling agent Knight Frank.

Mandarin Oriental is poised to open its first stand-alone branded residences in New York City, Beverly Hills and Barcelona. The U.S. residential units are expected to hit the market in the fall, the company said.

In Utah, the St. Regis Deer Valley, which opened in 2009, has recently added private residences to the resort. Hilton Worldwide Holdings Inc. is working on a number of stand-alone branded residences under its Waldorf Astoria and Conrad brands and plans to announce at least one project within the year, a spokeswoman said.

Overall, the number of hotel-branded residences more than doubled between 2010 and 2020. The sector added 52,000 homes in 370 separate developments, according to real-estate firm Savills PLC.

Originally, these residences offered a convenient way for property developers to fund the building of high-end hotels, which can be costly and challenging to finance through conventional loans. Instead, proceeds from apartment sales help cover the hotel construction costs.

“If I put your brand on it, it will help me sell these residences faster and for a higher price,” said Tim Grisius, Marriott International Inc.’s global mergers and acquisition and real estate officer.

Marriott has built 17 stand-alone luxury residences worldwide, in places like Sunny Isles Beach in South Florida and Bodrum, Turkey, under its Ritz-Carlton brand. It has another 17 projects in the pipeline.

‘If I put your brand on it, it will help me sell these residences faster and for a higher price.’

— Tim Grisius, Marriott International

As these residences grew in popularity, real-estate firms found that the units attracted wealthy buyers even without the full slate of hotel amenities. That’s because buyers of private residences tend to have a strong loyalty to the luxury brand and believe that attention to detail will be high, said Rupert des Forges, head of prime central London developments at Knight Frank.

“They feel that the brand would not put its name to something if they could not provide the right level of service,” he said.

Branded residences usually offer much the same services as a luxury hotel but on a smaller scale, including spa facilities, a bar and restaurant, movie theatre, and private dining rooms. Hotel-trained staff run the property and concierge, promising the same level of service to owners as to hotel guests.

Apartment buyers are often willing to pay a premium for branded residences compared with other luxury buildings, though the level of that premium varies. In London, a city overflowing with prime apartment buildings, Mr. des Forges said the extra cost of buying the property, compared with an equally high-end new apartment, was marginal.

In the Alps, however, five-star brands are increasingly experimenting with residences in ski resorts. Jeremy Rollason, head of real-estate agent Savills’s ski department, said these residences far outdo the resorts’ existing apartment buildings. He estimates that buyers have to pay premiums of between 10% and 20% for these “ultraluxury” homes.

Hotel residences have existed at least since 1927, when New York City’s Sherry-Netherland opened. But it wasn’t until the 1990s that the sector really took off. By last year, branded residences were located in more than 60 countries, according to Knight Frank.

After tapping demand in traditional coastal and city locations, developers are now building these residences in upscale ski resorts in Europe and the U.S.

Hard Rock Café International Inc. opened its first European ski resort and residences in Davos, Switzerland, in 2017, while Ritz-Carlton plans to open in 2026 a resort plus residences in Zermatt, Switzerland.

While the pandemic has slowed most international travel, Marriott’s Mr. Grisius said that demand for residences had actually increased, possibly at the expense of traditional hotels.

“People are not travelling as much,” he said. “Our residences are fuller than they usually are.”

PHOTO: FINCHATTON

Reprinted by permission of The Wall Street Journal, Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: August 10, 2021

A breathtaking view and a lush quarter-acre block are high up the wish list with any lifestyle property, but this contemporary Buderim residence takes things to another level.

Designed and built by owners Stu and Nat Faid, the Sunshine Coast home reflects their vision and incredible attention to detail.

As an architect and designer, Nat believes a prime position deserves an incredible project.

“The heart of the house is undoubtedly the living area and expansive deck. At over 100sq m and elevated more than 6m above the ground, you literally feel like you’re floating. We love how the views stretch from the Glass House Mountains along the coastline to Mooloolaba. Across the ocean, you can even see the sandbanks on Moreton Island,” she says.

While the views and the 1024sq m land parcel make their mark, it’s the suspended 12m heated shipping container swimming pool that’s making waves locally.

“When people arrive, the first thing they do is look up,” Nat adds.

After purchasing the property in 2021, the pair knew the existing house wouldn’t live up to their family of four, but they fell in love with the location and outlook so decided to adapt.

Initially, the pool’s unique design was simply a reaction to an everyday Queensland problem, but ultimately became a feature.

“The pool was at first a product of practicality. We wanted to be able to watch the kids in the pool from the house, but to do that required elevating the pool more than six meters off the ground,” Stu says.

“When we looked at the engineering required, it conflicted with our minimal-touch ethos in preserving the land and the visual aesthetic of the finished design. What followed was a lot of searching for a solution, and as luck would have it, the answer was almost on our doorstep.”

Shipping Container Pools seemed like a no-brainer answer to the pool problem. Having moved internationally multiple times, the couple saw an opportunity to weave their personal story into the fabric of their new home.

“The opportunity to incorporate a nod to that chapter of our life into the build was too good to miss,” he says.

“It also unashamedly reinforces the origins of the pool construction, which ties into the rest of the design in the house. Throughout the home, we have embraced where the old meets the new, we have not tried to blend, cover or hide the origins of the home, we have chosen instead to make sure the evolution of the house is clear to see.”

The Faids’ global family journey is evident throughout the home, from the grand Middle Eastern entry doors sourced from Dubai where the couple once lived, to the remarkable views from the Glass House Mountains to Mooloolaba.

Created to enjoy every season, the house has a space for all eventualities with an open plan living area spilling out to the full-width deck and pool, a sleek kitchen with an Ilve integrated fridge and freezer, Bosch ovens, an induction cooktop, built-in coffee machine and microwave, two dishwashers, filtered water and a butler’s pantry.

Four spacious bedrooms each have built-ins, the main features a large ensuite with twin vanities and two more bedrooms share a“Jack and Jill” style bathroom. There is also a third full bathroom.

The Buderim home is 12.5kms from Mooloolaba and the Mooloolaba River National Park with the Sunshine Coast Airport 13.5kms to the north, however Stu adds that there is rarely a reason to leave.

“It would be fair to say that apart from popping down the hill to go to the beach, we often go days without ever leaving the village. It’s really is a wonderful spot.”

Packed with mod cons, the Buderim home also features six-zone ducted air-conditioning, engineered oak floors and a double-sided Stuv wood-burning fireplace, a mudroom, heated floors and sensor lights in the bathrooms. There is also a private elevator, solar power and battery, as well as landscaped gardens and a large lock up garage and shed.

The property at 10 Orient Court, Buderim is listed with Zoe Byrne and Greg Ward from Ray White Buderim and will go to auction on September 22 at 9am at Mercedes-Benz Sunshine Coast, 65 Maroochy Blvd, Maroochydore.

Luxury Hotel-Branded Apartments Entice Buyers

Overall hotel-branded residences more than doubled between 2010 and 2020.

This sky-high home on the Sunshine Coast with iconic shipping container pool is a testament to modern design and engineering.