A living room at OWO Residences in London . Photo credit : Grain London |
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unique shopping experiences to hotel guests and full-time residents .
This trend is particularly pronounced in luxury , lifestyle mixed-use , said Makis , as branded residences seek to collaborate with brands to provide high-end experiences . She cited the Asbury Ocean Club on the New Jersey Shore , which features a cinema room , chef ’ s kitchen , art gallery , spa , fitness center and a retreat called The Drawing Room encompassing a bar and music room .
Branded residences aren ’ t a magic pill for mixed-use . As Makis said , “ It ’ s crucial to acknowledge the challenging landscape in terms of development .” As mixed-use projects thrive on scale , she said , they encompass significant space requirements and demand substantial capital investment . Further , said Makis , as with the broader construction industry , disruptions in areas , such as construction hiring , material costs , backlogs and financing ,
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are limiting the pace of new mixed-use construction . |
THE BRANDS BENEFIT There are many reasons why mixed-use developers seek out well-known hotel brands to partner with on branded residences . They often utilize a condo component to offset their basis in a project , said Randall . Some local jurisdictions allow condo deposits from purchasers to be used for initial project equity . In addition , having a recognized brand helps developers capitalize their projects . Randall noted that a hotel brand brings a market premium on unit sales , which is generally accepted as ranging from 20 % to 30 % above what the value would be on an otherwise unbranded project .
Hilton , said Randall , also brings a booking engine , expertise , service standards and a pipeline of customers . Beyond that , the company can provide a wide range of skills developers can choose from : handling
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HOA management , concierge services , 24 / 7 security , package receiving , in-room dining , signing privileges with the hotel , engineering , pet and auto services and more .
In addition , branded residence buyers receive Hilton Honors Diamond status , as well as dedicated owner concierges for the length of their ownership .
If a development can offer a hotel with an elevated guest experience beyond the physical restaurant space and basic amenities , said Makis , it will create an atmosphere of exclusive membership that will draw increased demand . This is particularly true with upperupscale and luxury hotels in
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Exterior of SLS Madrid Infantas Residences in the Spanish capital .
the lifestyle category , which have become popular meeting destinations . As a result of the extra layer of exclusivity and uniqueness in the overall hotel and mixed-use experience , these hotels , said Makis , achieve a higher ADR relative to the same class of hotels within their submarket .
A case study conducted by JLL in 2023 revealed that a sample of luxury and upperupscale hotels in mixed-used developments commanded an average rate premium of 27 %, resulting in a 21 % higher RevPAR index .
Owners , said Jacobsohn , get the benefit of both the hotel and their residential facilities . For example , Marriott ’ s recently
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Oct / Nov 2024 hotelsmag . com 17 |