The Global Branded Residences Report 2023 by Knight Frank Research reveals that the worldwide market for branded residences is experiencing continuous expansion, even in the face of recent substantial economic challenges.
The report anticipates a remarkable 55 per cent increase in the count of global branded residences by the year 2026.
By closely monitoring the endeavors of 15 prominent operators in the luxury branded residence sector, Knight Frank’s report identifies a total of 186 ongoing projects across the globe.
Additionally, there will be an addition of 32 new projects in the current year, followed by 23 in 2024, 26 in 2025, and 22 in 2026. Furthermore, the research unveils 35 more projects in the development stage without confirmed launch dates.
The number of upcoming projects with known opening dates showcases a 12 per cent annual growth rate leading up to 2026, translating to an overall expansion of 55 per cent within the specified period until 2026.
Approximately 40 per cent of all projects are situated in North America, with Asia-Pacific (including Australia) accounting for 20 per cent, and Europe for 13 per cent. These projects are spread across 52 countries, primarily centered in the US (with 106 schemes).
Other countries such as Mexico, the UAE, Thailand, the UK, and China also exhibit a notable presence with double-digit numbers of projects. Leading the pack in terms of project count is Ritz-Carlton, closely trailed by Four Seasons.
When considering the pace of expansion, Aman and Six Senses take the lead, with 68 per cent and 67 per cent respectively of their overall portfolios currently in various stages of development.
Knight Frank Head of Residential in Australia Erin van Tuil said while there was no formal definition, a branded residence was generally recognised as a residential property associated with an established brand, such as a hotel operator.
The brand provides the property with its branding, services and amenities.
She said there was currently only one fully integrated branded residence development under construction in Australia – with Four Seasons set to manage the hotel within the new STH BNK by Beulah development in Melbourne – and one completed project in Sydney, being Crown Residences at One Barangaroo.
But many developers and brands are currently actively exploring the option, Ms van Tuil added.
“Amid a shortage of new prime stock in Australia, buyer demand for branded residences in our country is strong, with the success of Crown’s One Barangaroo development evidence of that,” she said.
“We expect to see more branded residences entering the Australian market in the future, and we know they will generate significant interest and sales.
“There is a myth in the market that offshore buyers would make up the biggest pool of purchasers for these homes, and while Australia is a favoured destination for second home purchases, the depth of the market is much greater than that.
“There are plenty of domestic buyers, particularly Sydneysiders, who are looking for a branded residence to purchase, but there just aren’t any options in the market outside of One Barangaroo.
“There is also strong demand for branded residences on the Gold Coast – branded residences are all about lifestyle and the Gold Coast is a true lifestyle destination,” she said.
Knight Frank Director Residential Project Sales in Queensland Alison Hedger said the Gold Coast was a well-positioned opportunity for developers to consider best-in-class super-prime luxury branded residences as seen in established key hubs around the world.4
Ms van Tuil said for branded residences to be successful in terms of increased saleability and an uplift in prices, more was required than a developer just putting a brand name on their project.