In Georgia, the real estate market goes through its stages of development, and hotel rooms from global hotel chains are one of the pinnacles of this development. The concept of luxury residences managed by fashionable and popular hotels originated in early 20th century New York City.
Today, such residences are real estate that is marketed under well-known brands of global hotel chains, such as Wyndham Hotels & Resorts – Wyndham Grand. A well-known name imposes on the hotel a number of obligations that require compliance with certain standards. In the residences of world brands, everything is regulated, from the choice of light bulbs, models of door handles and faucets in the bathroom. The contract even specifies which slippers and soap will be offered to guests by the management company, as well as which tiles will be used in the bathroom and which laminate in the living room.
The management of a world brand hotel residence can only be carried out by the hotel chain itself or an international company accredited by it. This ensures that high standards of guest service are maintained.
This type of property has been absent from the Georgian market for a long time, but a new residence format has recently appeared, where investors can purchase hotel rooms for personal recreation or rent them out to generate income. In Batumi, this opportunity is now provided by the Wyndham Grand Residences Batumi Gonio project.
Unfortunately, some developers attach apartments to chain hotels and try to teach them the status of hotel residences of an international brand, but in fact these apartments are not connected with the hotel chain. They lack appropriate benefits, infrastructure, governance and standards. They should not be expected to participate in loyalty programs, strict quality criteria and other benefits. It is recommended to carefully check the documents confirming the number of numbers under the brand license.
Branded hotel residences owned by international brands provide investors with the opportunity to earn passive income from real estate – the dream of many investors.
According to the report Branded Residences 2022, released by the consulting company Knight Frank, the demand for apartments of international brands is growing. 39% of respondents are ready to pay more for staying in branded hotels, and the main reasons for them are comfort and a wide range of services.
High income
Brand awareness, experience, skills and connections of the management company guarantee high occupancy of your property, presence in global booking systems, participation in the loyalty program and cooperation with leading travel agencies.
For example, Wyndham Grand Residences Batumi Gonio, in which the management company is the world leader in this field – Aimbridge Hospitality.
As for prices, in Georgia the cost of a regular hotel room is about $50 per night, while a branded room can range from $200 to $1000 or more; in the US, prices range from $150 to $350-700; in Thailand, you will have to pay more than $500 for a room in a branded hotel, while a non-branded one is two to three times cheaper.
European Village Holding offers a guaranteed income from renting a room for Wyndham Grand Residences Batumi Gonio, which is fixed in the sales contract and amounts to 5-7% per year. The maximum income figures reach 15-18%, depending on the type of room.
There is a high demand for rooms and a high occupancy of the residences.
Brand residences offer a wide range of additional services and extensive infrastructure.
For example, Wyndham Grand Residences Batumi Gonio is the first all-inclusive hotel complex in Georgia. Its infrastructure includes three spa complexes, including a halal one, a complex with a hammam, Russian, Finnish and Japanese baths, saunas, two indoor and four outdoor pools with bars, an aquazone and slides, an indoor halal pool, two fitness centers, 12 restaurants , cafes and bars, wine and chacha houses with tasting rooms, a heliport and much more.
For professional events, the complex provides a coworking area, four meeting rooms and a conference room. Playgrounds, cafes, playrooms, a club with animators and a nanny, a rope park, a climbing wall and other entertainment are provided for children’s and family recreation.
Chain hotels have recognition, their own loyalty programs and regular customers. According to market research conducted by International Investment, regular non-branded hotels in Batumi have an annual occupancy rate of up to 30%, while international branded hotels have an average annual occupancy rate of 68%, which is a stable figure regardless of seasonality.
Capitalization
Buying or selling a room in a prestigious international hotel is also much more expensive.
For example, the cost per square meter in Wyndham hotels in Thailand ranges from €4.2 thousand to €7.1 thousand, while the average price for ordinary real estate ranges from €1.8 thousand to €4.2 thousand per square meter.
The average price per square meter in the Algarve region (Portugal) is €2,815, and in the Wyndham Grand Algarve hotel – from €6.6 thousand to 7.8 thousand. The cost per square meter in Ramada by Wyndham Sochi starts from $8 thousand in within the framework of the project under construction, and by the time of completion in 2024, the range is expected to be from $14 thousand to 1.1 million rubles.
Wyndham Grand Residences Batumi Gonio offers an annual return of at least 30%. At the same time, to protect the investment, it is possible to buy back at an increased price after three years, if the buyer wishes.
Another advantage of the hotel residences of world brands is the extensive infrastructure. For example, the Wyndham Grand Residences Batumi Gonio project is designed as a city within a city and includes four hotels and all-inclusive residences. The area of the complex exceeds 3 hectares, and it includes 90 infrastructure facilities.
International brands offer various payment options. It is possible to invest in a hotel residence of a world brand in order to receive income from renting out for management or capitalization even from Russia, with the possibility of paying in Russian rubles or any other currency.
