More and more developers and investors in Asia Pacific are interested in the luxury apartment market as the Covid-19 pandemic poses new challenges to living space.
Jaideep Dang, JLL's managing director of hotels in South Asia, said developers are increasingly interested in housing properties managed by hotel groups.
“Hotel corporations often want to integrate a hotel into a luxury apartment complex to increase operational efficiency. However, some corporations are now willing to manage independent residential areas without the hotel category," he said.
Potential customers of branded apartments often move between countries. Therefore, they realize the benefits of having a living space that belongs to them with hotel amenities such as living room, meeting room, gym... managed by the hotels themselves. Living in luxury apartments is not only a way of affirming class, but also ensuring the safety and privacy that this wealthy group of customers are always looking for.
Branded apartments appear in both residential areas between the city center and resort destinations, bringing a separate and classy living experience to customers. The demand for luxury apartments is driven by many individuals with high net worth assets.
This demand is increasing significantly after the Covid-19 pandemic, when the lines between home, work and relaxation are blurred due to remote working and social distancing. For digital nomads and elites, they can work from anywhere in the world. This is also the reason why luxury apartments are gradually establishing new positions.
Branded apartments meet all the new requirements that appear after Covid-19 in terms of privacy, health, safety, space to work and relax comfortably. On the other hand, it offers a desirable lifestyle, including access to the services and perks of hotel chains such as luxury spas and Michelin-starred restaurants.
From the developer's perspective, the price of a luxury apartment is usually 30% higher, bringing in greater revenue than a typical luxury apartment. This can be a disadvantage for customers during an economic downturn, but the advantages and benefits that owners receive far outweigh this price difference.
In Vietnam, since 2017, the supply of luxury real estate has increased an average of 11% annually to more than 2,200 units from 24 projects in the first quarter of 2021, according to Savills Vietnam. Savills data also shows that Vietnam is in the group of 10 markets with good growth rates in the field of luxury real estate in the world. Branded apartments are often concentrated in destinations such as Kien Giang, Da Nang, Nha Trang, Quang Ninh, Thua Thien Hue, Ba Ria Vung Tau... and have started to develop in Hanoi and Ho Chi Minh City. Target customers of this segment include domestic super-rich and foreign investors, mainly from China, Hong Kong, Taiwan and South Korea.
By Cafeland