Asia’s branded hotel residences market booms

Hotel branded residences in Asia is flourishing, having seen a strong upward trajectory over the past two years, with the region now accounting for more than a third of global stock, according to new research by C9 Hotelworks.

This robust growth is reflected by 79 projects in the pipeline, which will see the addition of more than 16,130 units for the upscale through luxury tier properties in Asia by 2025.

Thailand leads the hotel branded residences sector in Asia with the most number of projects in the pipeline

The top pipeline project location in Asia, volume-wise, is Thailand, which boasts a total of 30 projects and more than 4,700 units, accounting for 29 per cent of the total upcoming residential units. This is followed by the Philippines and Vietnam with 12 and eight projects, respectively.

In contrast, China has a large number of existing luxury branded residences, with over 57 per cent of the projects located in the first-tier cities.

Phuket and Bangkok continue to be an investment hub for hotel residences, with 13 and eight upscale and luxury pipeline developments, respectively.

“Despite the current headwinds facing Asia’s real estate markets from the Covid-19 crisis, we expect the region to lead the global property recovery
cycle,” said Bill Barnett, managing director, C9 Hotelworks.

More affordable offerings are entering the market, driven by rising demand for hotel branded residences; while the entry of upscale and upper upscale hotel products is also seeing an upswing.

In addition, both urban and resort destinations have seen a rising number of sustainable eco-focused projects.

The demand for upscale and luxury hotel branded residences comes on the back of the rise in the number of affluent individuals over the past decade.

Within Asia, pipeline projects in upscale to luxury segments are highly concentrated in the South-east Asia region, which accounts for more than 90 per cent of total pipeline stock. Nearly 50 per cent of the upcoming supply is affiliated with luxury hotel brands.

The key affiliated hotel groups for branded residences are Marriott, Accor, Dusit, Hyatt, Shangri-La, IHG and Wyndham, which combined represent 58 per cent of the total pipeline projects in the region. In terms of the brand chain scale, the luxury segment is the mainstream product while the remaining supply is evenly shared by upscale and upper upscale brands.

While over 51 per cent of the completed properties are located in urban areas, pipeline projects are in favour of resort destinations which represent 58 per cent of the total upcoming properties.

Alila, Anatara, Mövenpick and Dusit D2 are the most active brands in resort destinations while in urban destinations, brands are distributed more evenly.

In terms of supply growth, the top resort destinations in Asia are Phuket, Bali, Phu Quoc, and Pattaya; while the top urban destinations are Bangkok, Kuala Lumpur, Manila, and Jakarta.

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