CBRE VIETNAM ANNOUCES THE MARKET HIGHLIGHT OF NON-HOTELIER BRANDED RESIDENCE - ENG

Non hotelier

Branded Residence

An overview of the non hotelier residencesbrandedconcept, its charisma and prospects in Vietnam RESEARCH & CONSULTING SERVICES, CBRE VIETNAM 2022

In the development flow of luxury real estate, branded residences have gradually asserted their class and growing. Not only are the presence of hotel brands, but also the luxury brands are ‘newcomers’ to the luxury real estate race. Non hotelier brands aim to bring unique and different experiences and are commensurate with the lifestyle of the upper class.

What is a non hotelier branded residence?

Non hotelier branded residences are real estate designed, constructed and managed in accordance with the standard of a luxury brand not belonging to the hospitality industry. These brands are pretty diverse, of prestigious brands worldwide, such as exclusive luxury brands in fashion, jewellery, cosmetics, and supercars: Versace, Bvlgari, Elie Saab, Missoni, Armani, Lamborghini, Porsche, Aston Martin, Fendi,…

Target prospective customers of the upper class, non hotelier branded residences are situated in prime locations with convenient transportation and luxurious interiors with first class amenities and services. Outstanding facilities, such as airports, marinas, golf courses, etc., are designed to meet the customers' entertainment, recreation and enjoying life needs. All are associated with the luxury brand's signature.

Dung Duong Executive Director, Head of Professional Services CBRE Vietnam

Non hotelier branded residences are not only an asset type. It elevates a new standard of luxury living.

How branded residences are creating new standards of luxury living

ultraBrandedrealestatehasbecomeanindispensablepartofluxuryprojectsAbout20yearsago,thefirstluxuryrealestateprojectsweredevelopedandalignedwithhotelmanagementbrandsandweremotivatedbytheexistingtourismmarketButthesituationisgraduallychangingThebusinessclass,merchantsandbillionairesthriveinquantityandquality,increasingconsumerdemandand

ownership of luxury products Seizing the opportunity, many luxury brands joined the game, which resulted in the origin of non hotelier branded residences

The standard of luxury living continues to evolve beyond traditional 5 star service Globally, the supply of non hotelier branded residences takes up 15 20% of total branded residences

Charisma of non hotelier branded residencesInaddition

to the advantages inherited from the traditional type of branded residences operated and managed by hotel units, non hotelier branded residences have their charm when there is a participation of luxury brands such as fashion, jewellery/watches and supercars

Residential properties attached to brands have new colours and shows the owner's passion

Non hotelier branded residence can be categorized into three types

1 Furniture and interior design are under the instruction of a luxury brand, and the brand name will go together with the building name. Missoni Baia Project in Miami, US, was named after the Missoni brand.

2. The project design was inspired by the brand but designed by a third party. The Brand must approve the design before construction.

3. The project's furniture is supplied by the brand use furniture items. This type of product is often attached to interior companies.

The Asian market is highly potential for luxury branded residences Despite the impact of the COVID pandemic, the demand for luxury goods in Asia has not stopped flourishing, as shown by the revenue in the H1 2021 of LVMH (parent company owning Louis Vuitton, Dior, Tiffany & Co etc ) in this area grew by 34%

The development potential of branded residences in Vietnam is quite significant, as the super rich class is expected to increase sharply According to a Nielsen survey in 2013, 56% of Vietnamese respondents said they are willing to spend money to buy branded goods This rate is the third highest in the world, just behind China & India In 2010 2019, the number of people with a net worth of over US$5 million in Vietnam increased by 13 9% each year, ranking second in the world after Bangladesh (Wealth X) InterNations' 2019 survey shows that Ho Chi Minh City ranks 3rd in the world as a place worth living and working for ex pats

The economy quickly expands, and there is a higher number of middle and upper classes, while the compatible housing class type is still under supplied The branded residence is still a relatively new concept in Vietnam.

5.5%

Vietnam’s expected GDP growth rate in 2022

(World Bank)

10.1%

The growth rate of the number of people with a net worth from US$1 to 30 million in Vietnam 2018 2023

(Wealth X, High net worth handbook 2019 report)

13.9%

The growth rate of the number of people with net a worth over US$5 million in Vietnam 2010 2019

(Wealth X, A decade of wealth 2020 report)

Symbolic Non hotelier branded residences

Location: London, UK

Developer: Nine Elms Property (DAMAC Group)

Brand: Versace

The first real estate project under the Versace brand name is in the London centre. The interior was crafted following the design and Versace under Greek mythology and Roman theme, using the Medusa icon in gold and cream tone. Each unit was engraved with a marble entrance. The top notch facilities include an enormous garden of 570 sqm, swimming pool, gym, indoor children's play area, and other high end amenities.

Symbolic Non hotelier branded residences

Porsche Design Tower

Location: Miami, Florida, USA

Developer: Dezer

The project with 132 units is the symbol of the noble society lifestyle Residents are well equipped with top notch amenities, especially exceptional supporting services for supercars: car delivery and maintenance, virtual golf course, racing simulation, cinema, v v Besides a massive sea view balcony, all units are furnished with a heating system and glass exhibition room to meet the desire to collect and maintain the supercars of the owners The Dezervator, the elevator system, allows owners to drive their car directly to their home

Symbolic Non hotelier branded residences The Rivus

Location: Ho Chi Minh City, MasteriseDeveloperVietnam:HomesBrand:ElieSaab

The first ever non hotelier branded residence in Vietnam and floating mansion inspired by Haute Couture in Asia designed by Elie Saab.The privilege of experience in a luxurious space is for the owner and their distinguished guests. 121 mansions were “tailored” and rigorously finished to each owner’s needs. The Rivus brings a spread of sophisticated Haute Couture art and the breath of a tropical resort, integrated with full amenities and the most advanced facilities, such as a marina, swimming pool, gym, outdoor cinema, and BBQ area…

SUPERCAR

Aston Martin Residences

Location:

Location:

Location:

Iconic Non hotelier Branded Residences

Keppel Bay

Location: Zhongsan, Guangdong,

Khun by

Location:

COSMETICFASHION

Residences by Armani Casa

Location: Sunny Isles Beach, Floria, USA

Brand: Armani

Location: Dubai, UAE Brand: BVLGARI

Location: Dubai, UAE

Iconic Non hotelier Residences

Palazzo Versace

Location: Gold Coast, Queensland, Australia

Brand: Versace

Location Dubai, UAE Brand: Elie

Location: Dubai, UAE

The growth rate of the middle and upper class, as well as the development of luxury goods, is the vital motivation behind the non hotelier branded residence segment to break into the Vietnam market and expand further

Luxury automobile brands (Porches, Audi, Lamborghini, Ferrari, McLaren) and luxurious fashion brands (Hermes, Hublot, Gucci, Chanel, Prada, Louis Vuitton, Saint Laurent, Givenchy, Dior, Burberry), all made their presence in Vietnam, showing the potentiality and attraction of the local luxury goods market In 2019, the revenue of this market was US$1 01 billion, equivalent to a CAGR of 6 67% in the period 2021 2025 Vietnamese luxury goods purchasing power is forecasted to recover in 2022 in the light of economic growth and expected average income reaching US$ 3,900/year

According to Wealth X, the growth rate in the number of rich people (net worth asset value from US$1 to 30 million) in Vietnam is roughly 10 1% from 2018 through 2023 and is in the top 5 countries with the fastest growth The substantial escalation of the upper class has played a vital role in the demand for enhanced services, proven lifestyle, and enormous spending on luxury goods This is the catalyst for the solid development of branded residence in Vietnam In 2021, the Vietnam’s real estate market welcomed the first branded real estate project in the ultra luxury segment with a selling price above US$12,000 psm Grand Marina and The Grand Hanoi have an average selling price of US$ 14,700 and US$ 25,000/sqm with a sold rate above 70%

Revenue of luxury goods market in Vietnam (USD)

Outlook billion (Statista) 6.67%

Annual growth rate of Luxury goods Revenue in Vietnam from of supercar market in 2021 2022 Statista

(Statista)

Summary

Non hotelier branded residence is designed, constructed and managed to follow the standards of a luxury brand The appeal of non hotelier branded residences comes from their uniqueness, value in the trusted name of the luxury brand, and price premium This product type perfectly meets the demand of the wealthy who desire to assert their class and luxury goods, especially paying attention to lifestyle and living experience

The world is gradually back to normal, opening the opportunity for foreign investors to return to Vietnam Vietnamese visitors also travel and experience the luxurious lifestyle of foreign branded residences worldwide This is the golden chance to affirm the quality of branded residence model, though it remains fresh in Vietnam

The Rivus is the first non hotelier branded residence in Vietnam with the Elie Saab brand CBRE expects this property type to flourish firmly, especially in Vietnam, thanks to the motivation from super wealthy class growth and a thriving luxury goods market

Dung Duong Pham

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