Author: Francesco Mekni

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.

An interesting article recently published by Mansion Global outlines how the bar gets raised higher and higher as real estate developers compete to ‘out-gadget’ each other, searching for new and original amenities to offer in their luxury residential units. If this is truly what buyers are looking for in new properties, it represents an important opportunity for international real estate marketing professionals.

The article highlights four distinct trends that international real estate marketing professionals should emphasise to potential buyers.

• A focus on health and wellness 

A generic gym or even swimming pool will no longer cut it with today’s discerning buyers. It’s now expected that any development will come complete with specialist equipment (such as battle ropes, TRX cables and medicine balls) and additional facilities such as meditation spaces, steam rooms and even dedicated fitness teams that include personal trainers and nutritionists. When it comes to swimming pools, saltwater types are preferred and they should either be Olympic-sized or exactly half of that, so that swimmers can properly time their laps.

There’s also an increase in holistic wellness features such as smart lighting and steam-ovens for lighter cooking options.

• Catering to older kids

In years gone by, facilities for children focused on toddlers and younger children. Creches and playrooms were commonplace, but “hangouts” for tweens and older were rare.

Developers are now making efforts to provide areas where older children can play video games or express themselves creatively through music and art.

• Smart technology and connectivity

For a while, the buzz around smart homes meant that developers looked to stuff property with as many gadgets as they could get their hands on. Nowadays, the emphasis has moved to adding features that only provide genuine value and are of use to the buyer. Chiefly, pre-wiring for connectivity during construction.

Another preference is for including temperature controls for individual rooms and additional security features such as facial recognition at access points.

• On-site personal and concierge services

If in international real estate marketing personalisation is king, in modern real estate development it is convenience.

On-site facilities such as salons and concierges who are ready to fulfil any request provide the personal touch that creates a “five-star resort” feel to a home.

It’s clear that the world of property development, and indeed international real estate marketing, is rapidly changing to meet the needs of the modern buyer.

It’s over a year since Marriott International entered talks to buy Starwood Hotels & Resorts, leading to much speculation about which brands will survive within the combined, enlarged entity. This interesting article looks at how the world’s largest hotel group is in fact planning to retain and segment its portfolio of 30 brands.

The 30 brands, even if they are very similar or traditionally considered to be direct competitors, will continue to operate as normal and will not be undergoing and branding changes. Many international real estate marketing insiders assumed that at the very least, the three brands which comprised of independent properties would be placed under a single umbrella and take on consistent branding. As it stands, Luxury Collection (with such properties as the Gritti Palace in Venice or the Palace in San Francisco), Tribute Portfolio (which includes the Royal Palm in South Beach), and Autograph Collection (Pier One Sydney Harbour; Atlantis Paradise Island) all retain their separate and distinctive brands.

How Marriott is Keeping Branding Distinctive

Marriott is identifying two main types of luxury travel ‘personas’ for their international real estate marketing efforts, characterising Ritz-Carlton, St. Regis, and JW Marriott as “classic luxury” while the other five luxury brands (e.g. Bvlgari, Edition, the Luxury Collection) are offering what they describe as “distinctive luxury.” The two categories represent different styles, with classic appealing to customers who are looking for traditional and business travel-friendly accommodation and distinctive appealing to those who want something more unique, modern and boutique.

This is a fascinating example of international real estate marketing at work, and it will be interesting to see how Marriott manages to retain the distinctions between famed rival brands such as Ritz-Carlton and St. Regis in practice. Global brand office of Marriott, Tina Edmundson, believes that it has already found the solution, explaining that each brand will cater to different mindsets. She points out that for the Ritz-Carlton, customers like to use it as a base to explore the surrounding area, whilst St. Regis customers consider the hotel itself to be the destination, and like to enjoy “performances by jazz legends or signature rituals like midnight supper and St. Regis bloody marys.”

 

 

Dubai is an undisputed world leader when it comes to luxury branded residences and international real estate marketing in general, so I was interested to read a recent report in Khaleej Times that highlights an example of the added value that branding real estate can deliver.

The Regal Tower in Business Bay is the second Kempinski-branded residences in Dubai (the first is on the Palm Jumeirah); facilities here include luxury real estate, 3 restaurants and a coffee shop, 5 swimming pools, valet parking and one of the biggest gyms and spas in Dubai.

Priced at its launch at Dh2,100 per square foot, the project is due to complete in 2019 at which point Brian Etemad, CEO of selling agent Tamleek, forecasts that “…the price is bound to appreciate to Dh6,000 per sq ft by then”. Etemad adds that several units have already been sold: “We don’t need to do road shows since Kempinski-branded units sell on their own.”

So there it is: Self-selling real estate that appreciates rapidly. What more could a developer wish for?!

 

In the months preceding the US election, a study commissioned by Yahoo Finance found that the price premium attached to Trump branded residences had fallen, and in October hundreds of (mostly) Trump tenants in NYC signed an online petition titled “Dump the Trump Name” from their buildings.

I wonder what a fresh study might find regarding the value of the Trump brand, now he is heading for the White House? It certainly gives credence to the notion of him launching Presidential Suites!

 

Graham Associates has been appointed alongside Sphere Estates to manage the international real estate marketing and sales for the final collection of residences at The Landings St. Lucia, an established 5* beachfront and marina development.

With spectacular uninterrupted views over Rodney Bay on one of St. Lucia’s most celebrated beaches, this impressive residential resort offers buyers the rare opportunity to own a freehold beachfront home in one of the most desirable and popular locations on the island.

Catherine Moye’s positive article on branded residences “Sleeping Partners” (based around our recent industry report ‘Branded Residences: An Overview’) is published this month in Spears Magazine Issue 53, for which international real estate marketing authority Chris Graham was interviewed.

Please view the piece here.

Having been appointed earlier this year following a tender involving no less than 10 international real estate marketing agencies, our team has now completed the renaming (Sanctuary Point) and preliminary branding of this spectacular resort site on the coastal entrance to the Bay of Kotor.

We look forward to starting work on the marketing for the private residences in the coming weeks.