Branded Residences – Real estate has a lot of potential, but if the investor does not have enough financial capacity and depends too much on sales, it can lead to the risk of construction delays, to the detriment of buyers. Therefore, in Vietnam's real estate market, counting on the fingers of one hand shows only 1-2 corporations that can do this like – Masterise Group….
The market for branded residences is on a positive growth trajectory. Savills research in 2021 shows that this segment has grown by 230% over the past decade. At the same time, this market is forecast to welcome more than 900 new projects on a global scale by 2026, a number that is almost double the current supply.
Branded real estate model requires strong capital flow
Branded real estate is a product that has been successfully developed in North America, which is also the cradle of this segment. Currently, developers are continuously expanding to other regions, including Asia - Pacific, where the economic growth is strong, facilitating the development of product lines. this premium product.
This is a niche in the entire real estate market, due to scarce supply and premium prices. Having achieved much success in the international arena, well-known brands are planning to expand their business to other regions, including Asia-Pacific. However, in Vietnam, luxury real estate is still a fairly new concept. Therefore, this segment in Vietnam still has a lot of potential to develop strongly in the future.
In Vietnam alone, coastal cities are becoming the ideal destinations for many prestigious international brands. For example, Da Nang with the Le Mériden branded project or Fusion Resort & Villas. Global Hotel Group Marriott International owns 2 Ritz-Carlton luxury apartment projects in Hanoi and Grand Marina in Ho Chi Minh City. This brand is expected to continue to expand operations with nearly 9,000 hotel rooms and luxury apartments put on the market within the next 4 years.
Not only focusing on big cities and resort locations, many brands also develop projects in satellite areas. For example, the 5-star resort in Ba Vi is managed by Melia hotel group. This choice comes from the geographical location and psychology of the people. These projects will meet the demand for short-term travel experiences on weekends instead of booking air tickets to other localities far from the city.
Need to adjust the legal regulations
Theoretically, the luxury segment is a highly liquid product with predictable returns. This is because a branded real estate project will come with high standard construction quality and a professional management and operation team to ensure the value and positioning of the product.
The potential of this field in the Vietnamese market lies mainly in foreign customers because these are customers who are familiar with international brands, so they tend to choose this type of product.
For this segment to grow stronger, Vietnam can attract foreign investors through incentives from administrative policies. One of the measures that has been successfully applied internationally is the priority visa policy for retirees. This visa regulation will encourage tourism-related investment from individuals abroad.
In addition, real estate ownership rights for foreign investors may also be considered for relaxation. According to Decree No. 99/2015/ND-CP, a foreign individual or organization can only own a maximum of 30% of the units in an apartment project and 10% of the units in the case of a residential project. single. This is quite a small number when a resort usually has less than 50 or 100 apartments. Legal adjustments will contribute to increasing the attractiveness of foreign investment in resort projects.
Investor picky segment
For investors, the branded real estate model requires strong capital flow. Investors can raise capital through pre-construction sales (pre-sale) to reduce the need for equity and loan capital.
Branded real estate investors face many challenges
However, if the investor does not have enough financial potential and depends too much on sales, it may lead to the risk of construction delays if sales results are not as expected, causing disadvantages. to the buyer side.
Another point to pay attention to is the feasibility of bringing big brands into their products. Usually, the presence of these units will bring a more classy positioning to the project. The traditional brands of this sector often come from the big brands in the hotel management industry. In the US and Europe, the number of brands participating in this market is very diverse, including big names in the automotive and fashion industries such as Porsche and Armani.
However, different locations and projects have distinct characteristics. Therefore, the ability to invest in branded real estate will also be more diverse. The question for the Vietnamese market is whether this super-luxury real estate model is suitable for the needs and capacity of the market. This is a problem that investors need to research carefully to get the right choice for their real estate project.
The appearance of luxury real estate is a sign of the positive development of the Vietnamese market. The fact that many large-scale real estate investors have appeared in Vietnam in recent years is a clear demonstration of the progress in talent and expertise of domestic units.
Therefore, the luxury segment in Vietnam will also record new growth milestones. The market is no longer a playground for international brands and designers, but also for domestic units. Vietnamese architects, investors and developers are having many opportunities to show their design and construction quality.
Hotline/Zalo for branded real estate projects via: 0911 525 454