Luxury Branding Changes The Game for Marketing of Luxury Condominiums
From Porsche, Fendi, Armani and Global Hospitality Franchises, the Addition or Loss of Brand Affiliation has Major Consequences
MIAMI, May 18, 2016 /PRNewswire/ -- Real estate investors and condo owners often purchase a property because of its affiliation with a popular high-end brand. What most of these buyers fail to consider is that the particular affiliation, or "flag" as it's sometimes known, is not guaranteed to always fly.
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In Miami Beach, the famed Canyon Ranch, known as one of the world's leaders in luxury amenities and spa facilities, recently came to a disagreement with the developers and pulled out. The change has come with many consequences. The homeowners or investors that purchased the units based on the Canyon Ranch brand value are now left holding units at a building now known as its historic hotel name 'Carillon.'
This situation, along with many others, is not just a branding issue – there are steep financial impacts as well. Of course the tenants and owners want to keep enjoying those much touted Canyon Ranch amenities, but at what price? The current monthly maintenance at Carillon risen to over $2/sf – more than double other luxury condos – leaving most owners paying upwards of $4,000 per month.
Condo affiliation with a recognizable brand can also make for one of the best investments possible. For example, the W South Beach, which was once a Holiday Inn, sold units for just more than $1m that are suitable for short term rentals, earning the owner significant income.
"I've worked with owners of units in the W South Beach who rent their units out for less than 2/3 of the year and still net more than 5% profit after all fees are paid," said Miami luxury broker and condo expert Ross Milroy. "This arrangement provides a luxury beachfront condo that pays for itself and is still available for their private use more than 100 days of the year."
It's important for investors to keep in mind that these branding affiliations have a lifespan and it's possible for them to come or go. Two years ago, the residents association at One Bal Harbour purchased the hotel areas and the 9 remaining units in the building which gave them complete control to negotiate with a luxury hotel operator. And negotiate they did – the building now known as the Ritz Carlton Bal Harbour features Ritz style amenities and a style of operation that the world class brand has built their reputation on. In this situation, original owners now enjoy a significant increase in value for their units.
Associations with global brand names are not limited to hotel operators. The Porsche Design Tower is slated to open this summer with only a handful of units still available, Fendi Chateau will open later this year and Residences by Armani is scheduled for 2018.
Whether individual brands come or whether they go, one thing is for certain: condo developers will continue to find ways to associate their buildings with who or what will make their building stand out – and sell out.
ROSS MILROY – AVAILABLE REAL ESTATE EXPERT FOR MEDIA
Milroy has over 25 years of experience in real estate and the creator of the Ross100 Condo Index (http://www.rossmiami.com/search-ross100-all-buildings/) ; currently considered one of the foremost experts on the South Florida condo market. Ross is available as an expert news source & is media trained on topics including: State of Foreign Investors/Speculators; Investments; Financial Planning, Trend Forecasting; Investment Visas; Cash vs. Credit Buying; Common Mistakes Among Buyers; Tax Related Issues, Condo Assessment, Condo Regulations & Policy. www.RossMiami.com
Ross Miami
1000 5th St., Ste 200
Miami Beach, FL 33139
CONTACT:
James Goll, 24-Group PR & Marketing
Email / 917-626-4769
SOURCE Ross Milroy Real Estate RossMiami.com
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