A branded residence is, as the name suggests, a residential building with a known branded attached to it. Historically, these have tended to be hotel brands. But it really just needs to be any brand that people know, care about, and will pay a premium for. So it could also be a fashion brand, a car brand, or whatever else.
This is a growing segment of the residential market. According to UK-based Savills, there were only 15 or so of these "schemes" in the 1990s (the UK uses scheme in lieu of project, which always sounds conniving to me), but by the end of this decade they expect the pipeline of branded residences to exceed over 1,200.
I would also argue that projects designed by celebrated architects and/or designers are a form of branded residence. And this is not being captured in Savills' number above.
Whatever your definition, today, the branded residence capital of the world seems to be Dubai, which feels right. And the biggest brands, by what appears to be a long shot, are Four Seasons and Ritz-Carlton (hotel side), and YOO and Trump (non-hotel side). Here are the full rankings from Savills:
This is an interesting part of the real estate business for a few reasons. One, it makes sense. A New Balance shoe that gets co-branded with Aimé Leon Dore unlocks additional value for both sides. ALD has a brand that certain people care about. So, of course the same would be true of real estate paired with the right brand.
Two, it's a growing market, and I think this is aided by the fact that development is an intensely local business -- so it can be hard to grow a globally-significant brand on your own. Sometimes you just need to borrow someone else's.
And three, it's usually a less risky approach to getting your name on buildings. Branded residences typically operate on a licensing model, which means developers pay for the right to use the brand. The brand may also capture some of the upside in the form of a percentage of sales. That's less risky than putting up your own money.
In other words, are tall buildings a prerequisite to competing in today's global economy? It's an interesting question. And Jason Barr -- professor of economics at Rutgers University-Newark -- does think they are an important ingredient. So much so that he wrote a book on the topic called, Cities in the Sky: The Quest to Build the World's Tallest Skyscrapers. While Jason does acknowledge that not every city needs them, he does suggest that not having them could hinder a global city:
If you look at Paris' global ranking in terms of its importance in the world economy, as measured by the size and number of international firms, it's falling. Paris in 2000 was ranked fourth, and by 2020, it was down to eight, losing out to skyscraper cities such as Singapore and Dubai.
In the last decade, Paris has shrunk by 122,000 residents. As reported by Forbes, "Many of those leaving are choosing either the suburbs or countryside around Paris, or they are relocating to France's smaller cities such as Bordeaux, Lyon, and Toulouse." By limiting its building stock, Paris is driving up housing prices, pushing out residents, and causing suburban sprawl.
While I agree that tall buildings are important "geography-shrinking machines", what we're really talking about is using land more intensely. We're talking about urban density. But you don't necessarily need tall buildings to have high population densities. Consider Barcelona, which is one of the densest cities in Europe, and consider this comparison between Paris (few tall buildings) and Vancouver (more tall buildings).
So is the argument simply that density is good for cities, and that tall buildings are one way to achieve that? Or is it that, now that cities like Paris are built out (albeit at very high densities), the only option for growth is to go up? I guess I'll have to read his book.
A branded residence is, as the name suggests, a residential building with a known branded attached to it. Historically, these have tended to be hotel brands. But it really just needs to be any brand that people know, care about, and will pay a premium for. So it could also be a fashion brand, a car brand, or whatever else.
This is a growing segment of the residential market. According to UK-based Savills, there were only 15 or so of these "schemes" in the 1990s (the UK uses scheme in lieu of project, which always sounds conniving to me), but by the end of this decade they expect the pipeline of branded residences to exceed over 1,200.
I would also argue that projects designed by celebrated architects and/or designers are a form of branded residence. And this is not being captured in Savills' number above.
Whatever your definition, today, the branded residence capital of the world seems to be Dubai, which feels right. And the biggest brands, by what appears to be a long shot, are Four Seasons and Ritz-Carlton (hotel side), and YOO and Trump (non-hotel side). Here are the full rankings from Savills:
This is an interesting part of the real estate business for a few reasons. One, it makes sense. A New Balance shoe that gets co-branded with Aimé Leon Dore unlocks additional value for both sides. ALD has a brand that certain people care about. So, of course the same would be true of real estate paired with the right brand.
Two, it's a growing market, and I think this is aided by the fact that development is an intensely local business -- so it can be hard to grow a globally-significant brand on your own. Sometimes you just need to borrow someone else's.
And three, it's usually a less risky approach to getting your name on buildings. Branded residences typically operate on a licensing model, which means developers pay for the right to use the brand. The brand may also capture some of the upside in the form of a percentage of sales. That's less risky than putting up your own money.
In other words, are tall buildings a prerequisite to competing in today's global economy? It's an interesting question. And Jason Barr -- professor of economics at Rutgers University-Newark -- does think they are an important ingredient. So much so that he wrote a book on the topic called, Cities in the Sky: The Quest to Build the World's Tallest Skyscrapers. While Jason does acknowledge that not every city needs them, he does suggest that not having them could hinder a global city:
If you look at Paris' global ranking in terms of its importance in the world economy, as measured by the size and number of international firms, it's falling. Paris in 2000 was ranked fourth, and by 2020, it was down to eight, losing out to skyscraper cities such as Singapore and Dubai.
In the last decade, Paris has shrunk by 122,000 residents. As reported by Forbes, "Many of those leaving are choosing either the suburbs or countryside around Paris, or they are relocating to France's smaller cities such as Bordeaux, Lyon, and Toulouse." By limiting its building stock, Paris is driving up housing prices, pushing out residents, and causing suburban sprawl.
While I agree that tall buildings are important "geography-shrinking machines", what we're really talking about is using land more intensely. We're talking about urban density. But you don't necessarily need tall buildings to have high population densities. Consider Barcelona, which is one of the densest cities in Europe, and consider this comparison between Paris (few tall buildings) and Vancouver (more tall buildings).
So is the argument simply that density is good for cities, and that tall buildings are one way to achieve that? Or is it that, now that cities like Paris are built out (albeit at very high densities), the only option for growth is to go up? I guess I'll have to read his book.
This is a familiar story that is, of course, not unique to Japan:
“Danchi”, or apartment blocks built by Japan’s housing agency during the country’s high-growth period, may look grim and outdated in today’s Tokyo, where flashy glass and steel towers reign.
However, I only just learned that, since 2013, the Japanese houseware brand Muji has been renovating apartments within these housing blocks in an attempt to reduce vacancies:
But danchi are becoming hip again, thanks to modern renovations by lifestyle brand Muji, which is turning the poky, multi-room flats into open-plan studios.
The above excerpts are from a 2015 article, but this partnership between Muji and Japan's Urban Renaissance (UR) Agency continues to this day. Today, they're also focused on creating a greater sense of community within these danchi neighborhoods.
It's a logical collaboration. Both want to bring good and affordable design to the masses. And obviously there are brand benefits for Muji. It's a way to expose more people to their products.
But what I find particularly interesting is that it, once again, shows the potential of a strong brand within the real estate industry.
According to the same 2015 article, as soon as Muji completed its first round of apartment renovations, UR saw 2x the number rental applications from people in their 20s and 30s. Perhaps the number is even higher today.
Clearly what happened is that you had young followers of the brand who said to themselves, "oh if Muji is involved, it must then be cool and nice, and so I'd like to live there."
I mention this because, as a gross generalization, real estate companies don't seem to focus on their own brands in the same way other companies do. (Again, I'm making a gross generalization.)
Instead, they often rely on 3rd party brands -- hotel brands, fashion brands, and whatever else -- to augment as needed. (See "Dubai is now the capital of branded residences.")
Maybe this is truly the optimal way to do it. Just partner as needed. Or maybe more real estate companies should invest in their own brand.
Photo by taro ohtani on Unsplash
This is a familiar story that is, of course, not unique to Japan:
“Danchi”, or apartment blocks built by Japan’s housing agency during the country’s high-growth period, may look grim and outdated in today’s Tokyo, where flashy glass and steel towers reign.
However, I only just learned that, since 2013, the Japanese houseware brand Muji has been renovating apartments within these housing blocks in an attempt to reduce vacancies:
But danchi are becoming hip again, thanks to modern renovations by lifestyle brand Muji, which is turning the poky, multi-room flats into open-plan studios.
The above excerpts are from a 2015 article, but this partnership between Muji and Japan's Urban Renaissance (UR) Agency continues to this day. Today, they're also focused on creating a greater sense of community within these danchi neighborhoods.
It's a logical collaboration. Both want to bring good and affordable design to the masses. And obviously there are brand benefits for Muji. It's a way to expose more people to their products.
But what I find particularly interesting is that it, once again, shows the potential of a strong brand within the real estate industry.
According to the same 2015 article, as soon as Muji completed its first round of apartment renovations, UR saw 2x the number rental applications from people in their 20s and 30s. Perhaps the number is even higher today.
Clearly what happened is that you had young followers of the brand who said to themselves, "oh if Muji is involved, it must then be cool and nice, and so I'd like to live there."
I mention this because, as a gross generalization, real estate companies don't seem to focus on their own brands in the same way other companies do. (Again, I'm making a gross generalization.)
Instead, they often rely on 3rd party brands -- hotel brands, fashion brands, and whatever else -- to augment as needed. (See "Dubai is now the capital of branded residences.")
Maybe this is truly the optimal way to do it. Just partner as needed. Or maybe more real estate companies should invest in their own brand.
Photo by taro ohtani on Unsplash
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