Armani... Bulgari... Versace... The list reads like a designer shopping mall catalogue. But these are not storefronts: these are addresses. Branded residences are residential complexes that combine the design and service style of their namesake brand, often located adjacent to or inside the brand's hotel or resort, and a growing number of luxury fashion brands are joining the real estate scene, CNN reports.
The number of branded residences has increased by around 160% over the past decade and is expected to nearly double globally by 2030, according to global property company Savills. And which city is driving this trend? Dubai. There are more luxury-brand residences there than anywhere else in the world, causing South Florida, a longtime sector leader, to lose its top spot last year.
While the number of projects in Dubai is growing (51 are completed and 48 are in the pipeline, according to Savills), so are prices. The Bulgari Lighthouse consists of 31 four- to five-bedroom “penthouses” across 27 floors, capped by a three-level, 13,000-square-foot “Sky Villa.” The latter was sold off-plan for $112 million in February 2023, just a month after the property opened, becoming the most expensive apartment in the city at the time. During the first half of 2023, 20 apartments were sold in the residence for a total of 2.15 billion dirhams ($585.3 million).
A designer's brand plays a vital role in appeal, said Patricia Wiel, CEO of ACPV, the architecture firm behind the Bulgari Lighthouse.
“A property of this nature, of this caliber, is not just a beautiful building,” she noted, adding that the operational requirements for these residences are more similar to a resort or hotel than a residential building. “You need a brand that guarantees that quality of service.”
"Sense of ownership"
ACPV began working with Bulgari on hospitality concepts in 2000, designing everything from the brand's first hotel in Milan in 2004 to the Bulgari Lighthouse in Dubai. Bulgari took a "residential approach" to its hotels, and rooms and suites were designed with a "sense of ownership," Viehl said.
For many typical branded real estate buyers, this is not their first home—or even their second—which creates a different relationship with real estate where convenience is key. “The maintenance component is extremely important to those who own the property.”
Aspects such as building management and maintenance are becoming increasingly important, as is purchasing a fully furnished property.
Often attached to a branded hotel or resort, these residences gain access to all the luxury hospitality amenities, but with complete privacy within their living space. And for resorts like Bulgari Dubai, in addition to the usual gym and spa, there is a range of lifestyle offerings such as Michelin-starred restaurants and world-class bars, making the resort a destination for the local community and tourists.
Buying "instant access to the Dubai lifestyle" is a big motivator for many high-net-worth individuals, says Faisal Durrani, chief researcher at Knight Frank Middle East, an independent real estate consultancy. Knight Frank's 2023 Prime International Residential Index puts Dubai ahead of top second-home destinations such as Aspen, Miami, the Algarve, and the Bahamas.
For luxury brands, the move into real estate helps them diversify their income as they make money through licensing or management fees, while for developers, branding means higher property prices. On average, branded residences cost 30% more than similar quality properties in the same location. But in Dubai this premium is significantly higher: 86%, according to Knight Frank.
Attention to detail
The property market in Dubai is also heavily focused on "off-plan" sales, where buyers purchase a home before it is built, based on location, floor plans, renderings, and specification details. Deposits for pre-construction properties can often be over $1 million for luxury properties.
As a relatively new market (the city has only been open to international buyers and investors since 2002), real estate in Dubai has experienced volatility over the past two decades driven by speculative buy-and-flip activity and oversupply of properties, Durrani said.
Branded residences can help offset those risks by offering reassurance of quality and service, especially for international buyers, said Arada senior director of business development Rosa Piro. “Buyers in Dubai tend to like brands and trust brands.”
Arada begins realizations of its first signature residence project, unveiled earlier this month: Armani Beach Residences on the popular Palm Jumeirah, designed by award-winning Japanese architect Tadao Ando.
According to Arada, the price per square foot of Armani Beach Residences is on average 63% higher than other branded residences on the Palm Jumeirah, with two-bedroom residences starting at $5.9 million. Arada expects the building to be completed by the end of 2026.
Piro believes that the Armani name is more than just branding for the project. “Both of our partners are very actively and personally involved in the project,” she said. “Mr. Armani himself is involved in the design of the apartments and adds his own touch.”
Those who purchase one of the two penthouses, one in each of the towers, will be able to experience first-hand the attention to detail: the price of the apartment includes a trip to Milan, a stay at the Armani Hotel, and a meeting with Giorgio Armani and the design team to discuss their style preferences, “so they get a full understanding of the Armani world,” Piro said.
Armani Beach Residences is just the first of many signature residence projects for Arada, which is already working on its next residence, which will be unveiled later this year. “There is strong interest from both buyers and developers to continue building branded residences,” Piro said.
16:33, February 23“Parajanov and Fashion” exhibition to take place within the Yerevan Fashion Week 2024
15:16, February 233 of world's most coveted hypercars to stun Dubai at historic RM Sotheby's auction
14:23, February 23Kylie Jenner presents new models of her Khy brand
13:15, February 23Part of Elton John's collection raises $8M on Christie's auction opening night
12:08, February 23ArmenՅԱՆs: Armenian designer Khosrov on his “tree dress” which hit the Grammy’s red carpet, his roots and inspirations
11:23, February 23‘50 shades of red’ by Salma Hayek
10:11, February 23Rihanna celebrates 36th birthday in style
21:15, February 22World’s tallest man again meets with world’s shortest woman
15:09, February 22Ben Affleck unhappy with Jennifer Lopez wanting to flaunt personal life
14:55, February 22Futuristic villa inspired by movie ‘Dune’ being built in Dubai
13:18, February 22Tom Cruise breaks up with Russian socialite Elsina Khayrova
12:43, February 22Kim Kardashian full of pride for daughter North who becomes one of youngest musicians to hit Hot 100 chart