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Graham Associates has won another award for its work in international real estate marketing, this time for our branding and repositioning work and the ensuing marketing campaign for The Rest Nature Estate near Johannesburg, which is now the #1 residential estate in the Lowveld region. The award was presented The Africa & Arabia Property Awards, part of the International Property Awards group which is now in its 26th active year, which are judged by an independent panel of 70 industry experts. This panel is chaired by Lord Caithness, Lord Best, The Earl of Liverpool, Lord Thurso and members of the House of Lords in the UK Parliament.

The awards are given for the quality of design, construction and presentation of individual properties and property developments, interiors, architecture and marketing. The awards are a recognition of achievement in a particular category or discipline by an expert judging panel.

An International Property Award celebrates the highest levels of achievement by companies operating in all sectors of the property and international real estate marketing industries. It is a world-renowned mark of excellence and Graham Associates is proud to have won six Best Marketing Awards over the last few years for our work on residential development projects around the world. These awards were given for work on major development projects in the UK, Canada, Mauritius and now South Africa.

High-scoring winners from the regional awards, such as Africa & Arabia, are automatically entered into the overall International Awards, which ultimately determine the world’s finest property developers and international real estate marketing companies.

The IPAX Africa & Arabia Global exhibition and networking event will be taking place on the 7th September at The JW Marriott Marquis Hotel, Dubai alongside the Africa & Arabia Property Awards, offering an exclusive networking arena for property and international real estate marketing professionals. The entry we prepared for our client also won a Residential Development award, both to be presented at the ceremony in Dubai in September.

For more information, please visit IPAX Global.

 

Chris Graham, as an expert on international real estate marketing, was invited as the keynote speaker (presenting on branded residences) at the Montenegro Government’s excellent FREI (Festival of Real Estate Investments) conference this week.  Well attended by all the major players in the regional market.

FREI is an annual event which takes place in Budva on the Montenegrin coast. It has been “carefully designed, using the best experiences of the leading worldwide real-estate gatherings, and through its versatile program taking place in various forms such as exhibitions, presentations-discussions, FREI provides a precise analysis of current investment moment in Montenegro and countries of the region. In addition, the Festival recognizes the global trends and offers projections of future developments in the real estate investment sector.”

Chris Graham was unexpectedly collared for an interview – in Montenegrin – on the live national TV evening news!  You can watch the video through this link, and catch Chris by scanning forward to around 25 minutes into the programme.

In it, he highlights the growing appeal of Montenegro as a destination for global property investment, explaining that in the near-decade that he has spent living and working in the country, he has seen a great deal of responsible and sustainable development.

He also praises the actions of the Montenegrin government which has managed to attract serious investors and luxury property brands that are renowned in the international real estate marketing industry to a relatively small country.

When questioned on a recent piece of research he and his team undertook, he explained that he had gone out to see how people perceive Montenegro, and discovered that as much as half of the people surveyed (from places all around the world)  knew nothing about the country “much less even where it is.” On a positive note, he discovered that of the people who had actually visited Montenegro, 9 out of 10 would be happy to return, which indicates an opportunity for a growing and sustainable tourism industry. Clearly Montenegro is able to charm anyone who makes the trip over!

A recent study by Tranio.com, international real estate broker, has analysed cross-border transactions and calculated the sum of cross-border purchases in commercial and residential real estate markets by collating figures from Knight Frank, Cushman & Wakefield, Savills, Colliers, CBRE, Real Capital Analytics and national statistical offices.

Last year saw impressive boosts in foreign investment in several markets as investors increasingly put their funds into overseas real estate to diversify their portfolios and protect their wealth from domestic risks. This is interesting from a property marketing perspective, and offers up numerous opportunities to better connect investors with the best properties for their needs.

The US market was the largest by volume of cross-border residential real estate transactions, as foreign nationals spent just over US$100 billion. The UK follows with US$53 billion.

The study found that Singapore and Spain had the greatest shares of foreign investors in the residential segment.

The citizens of Asian countries, the UK, US and Persian Gulf countries are among the largest and most important investor groups in the global property market. Russian nationals also continue to be noteworthy players.

Combining residential with commercial transactions, other world-leading markets performed as follows:

• Germany (US$25.8billion – of which US$3.075 billion was residential).
• France (US$25.1billion)
• Canada (US$21.4billion)
• Spain (US$20.2billion)
• Italy (US$16.3billion)
• South Korea (US$13.8billion)
• Australia (US$13.1billion)
• Singapore (US$11.3billion)
• Netherlands (US$10.5billion).

USA

American foreign investment grew from US$10.3 billion in 2009 to about US$60 billion in 2014. According to the US National Association of Realtors, Americans have shown increased interest in purchasing overseas properties, notably in Mexico, and Costa Rica, the Philippines, Colombia and Canada. In Europe only Spain, Italy and France attract US nationals (approx. 3-4% in each market) and according to AIG Private Client Group, UHNWIs buy property in Mexico (14%), the Bahamas (13%), England (12%), France and the Caribbean (9% each). The majority (79%) of American investors buy residential property, 53% preferring detached homes. Most (87%) are interested in holiday homes or income properties.

According to the National Association of Realtors, between April 2015 and March 2016 Chinese buyers (including from Hong Kong and Taiwan) spent US$27.3 billion on residential property in the USA, comprising 13.7% of all the foreign purchases in the country during the period and an impressive 26.7% of all purchases made in the residential segment. They tend to purchase homes worth around US$900,000, outpacing investment budgets from most foreigners by a factor of nearly two. Individual residential investors often seek out second homes (or abodes for their children studying in the US) and income-generating properties, more commonly in major metropolitan areas on the coasts. This investment is expected to grow to about US$50 billion by 2025. (NB It is worth noting that Chinese property investors are also interested in Canada: according to the National Bank of Canada, Chinese nationals comprise about a third of all buyers in the country).

UK citizens make the fifth largest group of foreign buyers in the US after those of China, Canada, Mexico and India.

United Kingdom

Britons are active overseas investors who most often acquire property in the US and European countries. According to Rightmove, British nationals constitute the largest group of buyers in Spain, Italy and France, with over a half of them acquiring holiday homes and flats in these countries. As such, property marketing professionals looking to sell to Britons would do well to focus on Western European properties.

Investors from China purchased US$3.75 billion in properties in London’s central districts. In the commercial segment, the rise of Chinese investment in the UK was particularly pronounced because of the falling inflows from Europe and the US.

Russian Federation

Figures from the Central Bank of the Russian Federation show that in 2013 and 2014, Russian citizens annually invested just above US$2billion in foreign property. In 2015, this shrank to about US$960 million and the final tally for 2016 is expected to fall short of US$800 million. Russians now seem to prefer budget residential properties, income properties with high yields and commercial properties to anything else – especially luxurious second homes.
According to Wordstat Yandex, Russian citizens searched most for Spanish, Cypriot, Italian, American and German property. Other metrics show that Switzerland and the UK are also popular markets among Russian investors; conversely interest in the Greek, Latvian, and Montenegrin markets is on the decline.

The article concludes that major developments in 2016, such as China’s emergence as a major investment source, impressive rebounding in several US residential markets and suppressed flows from Russia to Europe, may be indicate short-term trends in global cross-border investment flows.

Summarised from Adrian Bishop’s article.

Interesting new research presented in a report entitled “The Affluent Homebuyer: A Quest for Meaning” from Luxury Portfolio International (LPI) and YouGov can help guide international real estate marketing efforts. HNWI buyers are put into three (rather curiously named) categories:

• Practical Explorers (buyers of $1-$2million homes) seek trusted experiences and 80% prefer to work with a real estate agent on their transactions.

• Meaning Seekers (buyers of $2-$5million properties) are luxury lovers who proudly assert that once you experience true luxury, it’s hard to scale back (71%). They also value sustainability (74%) and want their purchases to mean something.

• Power Players (buyers of homes at $5million+) acquire the finest, most premier properties and are willing to pay to get them, with 83% saying they choose the best and expect the price to reflect this. They are motivated by a desire to ‘have it all’ and want to feel confident that what they have purchased is unrivalled excellence.

For the $million-plus homebuyer, the most important trait they look for in their estate agent is trustworthiness. The second and third are ‘knowing the details that distinguish the best’ and ‘taking the time to understand my needs’.

HNWIs have high – and ever-increasing – expectations of what ‘luxury’ offers them and they know that with each passing year they can expect more; as such, developers, designers, and hotel operators must continually raise the bar by delivering cutting-edge design and innovation along with 5* hotel and concierge services. Once properties have been built to these specifications, international real estate marketing professionals must look for opportunities to promote the luxurious experience. On this issue, LPI’s Stephanie Pfeffer Anton makes a poignant observation when she comments that the standard of luxury property today is very different from that of even a few years ago: “What passed as a luxury experience even five years ago, today feels tired and uninspired. The principle of luxury that matters today is emotional connection, which starts with human interaction and transparency in the process.”

In addition to an emotional connection, buyer motivations are becoming increasingly experiential (defined as ‘something that creates a closer bond between the consumer and the brand by immersing them in a fun and memorable experience’).  An article published by Luxury Society on HNWI trends states, ‘They want cool, they want fun and they want experiences,’ whilst a study found that 70% of Millennials in the US now “…look for experiences that stimulate their senses”.  As reported in our study on Branded Residences, Lynn Villadolid (former Six Senses Director & Brand Ambassador) succinctly observes; “There is now a myriad of top hotel brands offering supreme quality FF&E, so the choice is much more about how the brand’s values appeal to the buyer’s emotions, intellect and soul”.

Which all presents interesting challenges (or opportunities, depending on your viewpoint) for real estate developers and international real estate marketing professionals to stay ahead of the curve, remembering always that the customer remains king. Or queen.

Claire Pilton’s article in Condé Nast’s property sections this month features international real estate marketing expert Chris Graham’s recent industry report Branded Residences: An Overview.

The article details the way that partnering with an established brand can increase the desirability of a luxury development. Using several examples of globally renowned resorts, Pilton examines the link between branded residences and a profitable investment. Robert Green, of Sphere Estates, points out that these resorts are more likely to retain their high value and make for more appealing purchases for future buyers, should you wish to sell it on.

“On top of the “trophy status”, prime locations, cutting-edge interior design, technology and architecture, hassle-free ownership and premium lifestyle, many offer residents’ discount cards, access to the operator’s properties in other locations, higher rental income, stronger resale values — and like-minded neighbours. Small wonder discerning HNWIs make the best brand ambassadors.”

 

One of the most informed people I know on real estate and hospitality is Muriel Muirden, EVP and MD of Strategy at WATG (NB she wrote the Foreword for my Branded Residences paper), so it was with great interest that I read this new report published by Muriel and her team.

The report identifies some fascinating areas that the hospitality industry will increasingly need to consider, if it wants to cater for evolving customer requirements and tastes. These provide guidance for many excellent international real estate marketing opportunities. A summary of these trends discussed in the document is given below:

1. Digital Detox: Jaded by the endless distraction of social media and the addictive nature of the smart phone, we are seeing a strong movement towards digital detox. For the lodging sector we see strong opportunities to develop wilderness resorts that must offer a plethora of outdoor pursuits meshed seamlessly with a strong holistic ‘wellness’ theme…..and total immersion and digital disconnection is a priority.

2. Edible Environments: Farm-to-table and ocean-to-plate experiences are now well established on the travellers’ wish list – local produce and indigenous eating experiences are expected and no longer hold a novelty factor. But now we see the rooftop-to-salad bowl and golf rough-to-entrée – in essence the emergence of the ‘edible resort’. ‘There is without doubt an increased awareness of the provenance of what we eat. Our focus increasingly is on creating hotel landscapes that are edible ornamental gardens. We are placing hotels within vineyards, under olive groves and above edible parterres to create enduring, relevant and delicious experiences for hotel guests. Why have a fruit bowl when you can wander onto your balcony and pluck an orange from the tree?’ observes John Goldwyn, VP of Planning and Landscape at WATG. The report also highlights a desire for the simple life, driving a trend for communities and resorts anchored in eco-agriculture.

3. Fitness & Wellbeing: Across the generations we have become preoccupied with our personal wellbeing – boomers strive to hold back the ravages of time, millennials aim to optimise their personal fitness. Our lives are jam packed with wearables, apps, healthy eating blogs, fitness mash-ups and endless pop-ups to lure us into the belief that if we become disciples we can live forever. Yet the hotel sector, with a few notable exceptions, lags behind such innovations. Hotel fitness facilities remain largely traditional in nature. This has to change.

4. Eco-consciousness: Much has been written about the social and eco-consciousness of the over-analysed millennial, but I believe all generations have a greater awareness, and, many have a desire to be helped to do the ‘right thing’. The hospitality sector is uniquely placed to integrate those whose lives have taken a challenging turn back into society: expect more new hotel concepts aimed at making us feel good about ourselves, while contributing to a wider community or environmental platform.

5. Sleep: A good night’s sleep is the new holy grail and we will pay to seek it out. It is estimated that the industry for sleep apps and wearables will be worth $680 million in just a couple of years. Sleep labs, sleep workshops and sleep schools that create bespoke solutions to analyse and perfect the quality of sleep are springing up before your very eyes. So where is the hotel sector on this debate? Surely the primary purpose of a hotel is to provide a good night’s sleep. We predict a strong movement into hotels exploring this lucrative sector and moving it back to the top of their marketing agendas.

6. Simplification: Contemporary life is characterised by a tsunami of choices and decisions – from choosing fabric conditioner to selecting our latest smart (or dumb) phone. Sleep aside, the buzz is all about simplification: downsizing our decision-making for a less fatiguing life. So what does this mean for the hospitality sector? Goodbye to pretentious dining with lengthy menus and wine lists (give us menu free dining, single ingredient menus and simpler choices). Declutter our bedrooms and bathrooms and give us a fabulous bed, a ‘wow’ shower and generally minimise the choices we have to make.

7. Pets: Airports are creating dog parks and lounges, airlines are creating luxury pet plane cabins and pet friendly travel agents are emerging who ferret out the right accommodation. However, resorts will need to embrace the concept more.

8. Cannabis: ‘Bud and Breakfast’ tourism is most certainly on its way in the US. The $35 million Colorado Cannabis Ranch – Colorado’s first ‘weedery’ – is entering the popular winery and brewery tourism market. Research from Ackrill Capital projects that marijuana as a medical and recreational industry will top $40 billion in the next few years, with the potential to grow to $100 billion once it is legalised throughout the US.

9. Solitude: Much is written about loneliness, most of it focused on the elderly. Recognition of the issue has led to the creation of state and charity driven infrastructure to try to alleviate the solitude of old age. Taking a break from ‘adulting’ is manifesting itself in the evolution of summer camps for grown-ups. We see potential in this genre in a variety of locations and focused on different themes.

If you would like to receive a full copy of WATG’s report, please contact Muriel directly at mmuirden@watg.com.

According to Wealth-X’s research, in 2015 there were 2,473 billionaires in the world – a 6.4 percent increase from the year before.

Billionaires are now wealthy beyond belief – and they are getting much wealthier than the broader ultra-high-net-worth (UHNW) population, which is defined as anyone with more than $30 million.

In 2015, there were 212,615 Billionaires and UHNWIs:

• At the bottom end, 155,050 people worth between $30 million and $99 million had a combined wealth of $8.4 trillion.
• At the top end, the world’s 2,473 billionaires were worth a combined total of $7.68 trillion.
• The Top 10 — nine from the United States, one from Spain — have a combined net worth of $582 billion.

Overall, the pace of growth in billionaires worldwide is predicted to slow in line with economic growth around the world. Wealth-X reports that by 2020 the number will actually decline by 16 percent to 3,250, from an earlier prediction of 3,873.

Number of Billionaires on Wealth-X’s list by Sector

1. Finance has 377 (15 percent of the world’s billionaires).
2. Industrial conglomerates, with 317 (13 percent).
3. Global real estate is third with 141.
4. Non-profits (i.e. they made their money some other way or inherited it) has 122.
5. Manufacturing has 120.
6. Technology has 114 (NB six of the top 10 billionaires made their money in technology).

Where Are They?

Although billionaires in the United States are often better known, there are actually more billionaires in Europe (though they have less total wealth than their American counterparts).

According to research from UBS, a new billionaire is created every three days in Asia. Two-thirds of the region’s billionaires are in China, where the number continues to rise quickly.

Excerpts taken from the New York Times article, “The Most Exclusive Club.”

 

 

Brand value is all powerful and vital to the growth of hospitality brands, yet according to recent indices from Interbrand, WPP (BrandZ^TM) and Forbes Most Valuable Brand Index, there are no hotel brands in the top 100 global brands, reports international law firm Taylor Wessing. The 2017 Brand Finance Top 500 Global Brands Report ranks hospitality companies as Hilton (171), Booking.com (274), Marriott (332), Expedia (367) and then Sheraton (443).

Perhaps even more striking, the hospitality “service companies” are becoming as recognisable and valuable as the hotels they feature. With increasing market presence and massive marketing budgets, the signs are that these will put the hotel brands under even more pressure to deliver on their brand value and recognition.

If hotel brands are to compete with the plethora of alternative accommodation now offered by web-based companies such as Airbnb (ranked at 474, but predicted to climb), they must find better methods of targeting young consumers. Millennials tend to trust reviews from their peers, value convenience, and will not accept brand prestige as a reason for checking in. These considerations offer unique international real estate marketing opportunities, some of which hotel brands are already trying to take advantage of.

For example, in 2015 Marriott launched a new chain, Moxy Hotels, specifically targeted at young travellers who place their emphasis on experiences over materialism.

“We did tons of research to find out what millennials wanted, and the ideas of authenticity and communal spaces were very important. The idea is to create a living room where you can hang out with people and also always be plugged in,” said Vicki Poulos, global brand director of Moxy Hotels. “It’s like a boutique hotel that has the social heart of a hostel. That’s why people stay at an Airbnb, so we built a brand that had that same communal spirit.”

Clearly, hotel brands know what they need to do, it’s just a case of making a consistent effort that will raise their value over the coming years.

The Global Property Handbook (from Warburg Realty and Barnes International Realty) finds that ultra-wealthy buyers mainly base their real estate purchasing decisions on three factors – practical, emotional, financial. “For them, real estate is a living asset, which sits at the intersection of the head and the heart,” said Clelia Peters, president of Warburg Realty.

Weighing up factors within these three categories, despite the surprise Brexit vote last year the report still ranks London as the world’s most desirable city, followed by New York and Japan. It also finds that 10% of individuals with a net worth of $30 million or more own at least five properties and that more than two-thirds have self-made fortunes.

Even though UHNWIs have a substantial amount of funds to invest in real estate, they still make decisions based on practicality. For example, most affluent businessmen prefer to live in close proximity to where they work, as well as near to younger family members who are attending school or college.

There’s a pervasive assumption that ultra-wealthy consumers almost buy property as an impulse purchase. If it has a certain number of bathrooms or unique features such as home-cinemas or an indoor pool, the desire outweighs the practicality and a purchase is made. As the report above states, this is simply not the case. UHNWIs will still choose real estate that appeals to their personal taste, but they are for more likely to first consider the location and investment potential of a particular property.

A Wealth-X report finds that 79% own at least two homes, and 53% own three or more. A Luxury Society article identifies home-buying motivations for this demographic, and found that many consider real estate purchases as both safe investment diversification and as a “gateway” to new markets, particularly when the property is abroad. This demonstrates a clear practicality that international real estate marketing experts may not be fully taking advantage of.

 

A couple of recent articles in Mansion Global look at how luxury real estate developers are continually raising the bar to satisfy the ever-increasing expectations of discerning HNWI buyers. But it’s no longer just about the physical elements.

When luxury residential developers plan their projects, much thought goes into the amenities and features that will most entice buyers and offer ‘more’ than the competition. Whilst in the past a Kids’ Club, pool, gym and concierge service might have been enough, in today’s high-end market such features are considered standard.

Today, many developers incorporate amenities and features that have been well tried-and-tested in the luxury hotel and hospitality sectors, but it’s not enough to include a wide-range of features that simply tick the boxes; it is the authenticity of experiences for residents and the meaningfulness of the spaces and living environments that have now become more important than the amenity itself.

The article focuses on four elements that developers are incorporating into new luxury projects:

• Health & Wellness

This should of course include a gym, but should go further to add services like personal training and nutrition plans for residents. There’s also a need for “trendy” equipment like battle ropes, resistance bands and TRX cables.

Many would also expect areas dedicated to yoga, pilates and meditation as well as spa facilities.

• Older kids

Child-friendly areas have traditionally only catered to young children with playrooms. Developers are now tackling the challenge of keeping teens occupied with engaging and creative activities.

• Smart technology and connectivity

It’s inexcusable to not have lightning-fast WiFi in this day and age. Attention has now moved to intelligent security, lighting and heating.

• On-site personal and concierge services

Convenience and personalised services are integral to the overall experience of owning a home in a branded residence. On-site salons, bakeries and more are becoming increasingly common.

Readers may like to download a free copy of our “Branded Residences: An Overview” report , which also looks at industry trends and was written by an international real estate marketing expert.