Phuket is one of the most sought after resort destinations in Southeast Asia. In the past, foreign investors have successfully invested in local hotel properties and profited from the many tourists visiting the island. However, there is now a change in trends. There is a huge demand for branded residences.
What is branded real estate?
Branded residences are complexes of apartments or villas located in attractive locations and managed by international hotel chains.
At its core, it is a hybrid between a hotel and a residential building.
Unlike conventional hotels, branded residences are designed for permanent residence. For example, hotel rooms may not have a kitchen, while it is mandatory for residences.
In addition, the area of branded residences is usually more spacious, which is exactly what is lacking in Phuket.
Hotels usually plan apartments ranging from 30 to 45 square meters. Developers are guided by the rule “the smaller the area, the faster the room will pay off.” As a result, in many complexes more than 70% of the units are studios, and even apartments with two or three bedrooms are less than 100 square meters. At the same time, for branded residences, areas from 150 to 200 square meters are the norm, and there are also more spacious options.
Perhaps not everyone knows, but standard rooms in five-star hotels and condominiums must have an area of at least 42 square meters. In branded residences, the minimum area that I have come across is 56 square meters for one bedroom apartments.
What is the difference between branded housing and ordinary housing?
If you live in a hotel-managed apartment, then you are freed from the routine of cleaning, washing, ironing and preparing breakfast… All these tasks are taken over by the staff. Thus, you win free time that you can devote to yourself, your hobbies or family.
At the same time, all the services provided to you correspond to the highest level of a five-star hotel.
Is the brand behind real estate always a hotel?
The development of the real estate sector is happening at an extraordinary speed. For example, according to open data from CBRE, one of the leading real estate consulting companies, the number of branded residence sales during and after the lockdown increased by 503% compared to the pre-pandemic 2018. At the same time, demand continues to grow.
Many global brands are currently seeking to enter the real estate market. In different countries, there are already successful examples of cooperation between developers and car manufacturers, fashion houses, jewelry manufacturers, etc.
However, in Phuket, tourism is the mainstay of the economy. In the premium and luxury segment, our region has the highest rates for hotel accommodation in Southeast Asia, with the exception of Singapore, which is not a resort. Therefore, hotel brands are the most active here.
Are branded residences always luxury real estate?
We are on the threshold of the future. The technology is just beginning to develop and is currently available to only a few.
However, earlier the projection of information on the windshield was typical only for very expensive cars, while today this function is also present in middle-class cars. It is likely that as the sector develops, more economical projects will appear. But at the moment, this mainly applies to premium and luxury real estate.
What are the prices in Phuket for such housing?
One of the most successful projects of this year is the MGallery complex. This brand is little known in the Russian market, but it is highly respected all over the world. MGallery is a chain of French 5* boutique hotels known for their superb design and thoughtful service.
In this complex, one-bedroom apartments have been sold for prices ranging from $300,000. The complex consists of low buildings, each of which contains four apartments. Buyers had the opportunity to purchase an entire floor or even the entire house, becoming the owners of an exclusive object. Almost all apartments have already been sold.
In general, if we consider interesting and liquid options, then prices start at $ 600,000
From the point of view of conducting a purchase and sale transaction, is there a difference between branded and ordinary housing?
The process of concluding a transaction when purchasing property in Thailand does not change, but the property itself may have its own characteristics. For government authorities, it is treated like any other object, and all applicable laws of Thailand apply.
If you buy apartments in a condominium, you can take full ownership of them even as a foreigner. In the case of villas, the transaction may be for a company on freehold or for an individual on leasehold.
It is important to carefully study the contract, as certain restrictions may be set in it. For example, the owner may be restricted from renting the property on their own using the hotel brand in advertising, or they may be required to rent the property for a period of at least a month.
You can live in your residence for as long as you need, and rent out the rest of the time. Since Phuket is predominantly a family resort, such facilities are rented for one to three months. And renting through the hotel is less troublesome.
