At the beginning of this year, my friend Amy Bath wrote an interesting post on her blog comparing condos and boutique hotels. It’s called: Could condos be more like boutique hotels? It’s a great read and it touches on something that I think we will see more of going forward.
The idea is that boutique hotels – many of which invest heavily in things like programming and “cultural engineering” – could serve as a model for condos and developers who want to further differentiate themselves by doing more with their common areas and amenities. I think it’s a great idea.
But let’s backup for a second.
In many cases, I feel that developers tend to privilege the brands of their specific projects over their own corporate brands. This likely has something to do with the entrepreneurial nature of how development projects often come together, but I personally don’t think it’s the best approach.
It’s the equivalent of a car company downplaying its own brand and instead creating a new one for each and every car model that it comes out with. That’s a lot of work and it’s harder to build brand equity that way. So I think the trend is probably away from this approach.
But as that happens, developers will inevitably start to wonder how they can differentiate them themselves: How do I make my bricks and mortar less of a commodity? The same way that Apple made computers not about processor speeds and memory, but about something so much more. You create a brand story and an experience.
And one of the best ways I think you could do that is through exactly what Amy is talking about: programming and cultural engineering.
Back in 2006 when I was fresh out of architecture school and looking for work, I knocked on the door of a design company based in London with my polished resume in hand. I was sleeping on a friend’s couch at the time and the company seemed like a perfect fit for me – so I went for it.
There’s no happy ending to this story though – because I didn’t get past the front door that day – but there’s never any harm in trying. As my friend told me the morning I went: fortune favors the bold.
The firm I visited that day is called YOO.
They call themselves “a residential and hotel design company”, but their model is actually more unique than that. Founded in 1999 by John Hitchcox (a property developer) and Philippe Starck (a rockstar designer), the firm partners with local real estate developers around the world and creates value through design, branding, and marketing expertise – as well as through celebrity names like Philippe Starck and Jade Jagger.
They did one project in Toronto with local developer Peter Freed called 75 Portland.
What makes their model interesting is that, unlike the real estate developers they partner with, they’re not assuming the same level of risk (unless, of course, they co-invest). They get paid (well) for the design services and marketing expertise they provide, as well as the brand equity that they bring.
This is similar to what Donald Trump does with some (most?) of his developments now. Want the Trump name on your building? Pay $X. Want Philippe Starck at your condo sales launch? Pay $Y.
When I was in architecture school, I used to wonder why we didn’t talk about the importance of branding and marketing. I thought we should. Which is probably why I ended up in business school afterwards.
I think there’s a lot of potential in overlaps and hybrid business models, which is why I was excited to learn today that YOO has just launched a new architectural practice called YOO Architecture.
You can read more about it here.
Image: Icon Brickell, Miami via YOO
A friend of mine recently introduced me to a young real estate company out of New York called ASH NYC (the founders are around 30).
But in reality, calling them just a real estate company is an oversimplification. They’re actually a vertically integrated firm that brings interior design, real estate development, property management, hospitality, and a few other disciplines all under one roof. The way they talk about it is in terms of “joining historically compatible disciplines” and “creating both aesthetic and economic value” – which is a pretty neat approach.
I’ve written a few times before about the future of the architecture profession and so I think it’s really interesting to see yet another example of design being completely integrated with real estate. And I’m certain we’re going to see more of these kinds of hybrid and integrated business models across many other industries.
In my own career, I’ve been (somewhat similarly) fascinated by the intersection of design, real estate, and technology. And I suspect that many of you also feel like you’re operating in some kind of overlap. Is that true?
Image: ASH NYC