: Property developers across Thailand are experiencing a magnetic attraction for hotel branded residences in order to spur price premium points and buyer demand. Currently there are 29 new hotel residence projects countrywide with nearly 90% of these located in resort areas.
New research by consulting group C9 Hotelworks has pinpointed that the top 3 locations for completed and pipeline projects in their Southeast Asia Hotel Residences Market Trends report are Phuket (26 properties), Pattaya (10 properties) and Bangkok (9 properties).
Viewing how Thailand ranks in terms of competitiveness in the sector, with 41 completed projects to date, this accounts for 41% of the regions supply that stands at over 21,000 hotel residence units. Indonesia follows, whilst the rising star is Vietnam with Danang featured as a favored developer’s marketplace.
In Thailand, Phuket with 13 completed projects and another 13 in the works has a longstanding legacy of hospitality-led residences in such well-known ultra-luxury resorts as Amanpuri, Banyan Tree and Sri Panwa. Though over the past few years Bangkok’s Chao Phraya River with marquee branded projects affiliated to the likes of global icons Four Seasons and Mandarin Oriental have pushed prices though the glass ceiling to an average of more than THB315,000 per square meter, while the national average selling price in the sector is just over THB101,000.
Commenting on the connection to brands and pricing premiums, C9 Hotelworks Bill Barnett said “our research in all the markets in the country show a demonstrated brand premium between 15-20%. Taking a close look at existing supply 92% of the supply are brand affiliated and we expect this preference by developers and property buyers to continue.”
Branding and its relationship to real estate is not solely in the hotel domain. Thai-based Onxy Hospitality recent entered into an operating agreement with the international design group Yoo which was founded by Philippe Starck and John Hitchcox to run their branded properties.
And another move in the design brand space Bangkok’s BLINK Design Group who work extensively in hotels, resorts and residences bought over noted creative firm Jaya. The latter subsequently formed a venture with boutique hotel management group Two Roads Hospitality for Jaya branded hotels and residences.
Despite the presence of legacy global hotel brands that appear in C9’s data across Southeast Asia a number of Thai brands and hotel management groups are well placed such as BHM Asia, Dusit Thani, Minor and Onyx. Notes C9s Bill Barnett “is an increasing number of mixed-use projects that feature both hospitality and residential elements and hotel operators who want to drive expansion can’t ignore the strategic benefit of offering developers a holistic management and brand solution.”