Miami ranks second only to Dubai among global markets for its branded residence pipeline, a newly released report shows.
Dubai had 64 completed projects and an additional 87 in the works, with Miami trailing behind with 48 completed projects and 55 planned, according to the report from British brokerage Savills. The numbers reveal a diversifying sector proliferating throughout global markets, expanding outward from its American origins.
A similar report published in September by Knight Frank found that the Middle East accounts for 15.9 percent of active branded residences globally, and 26.7 percent of all pipeline projects. Combined, U.S. markets make up 32.7 percent of branded residences, and 26.2 percent of pipeline projects, the report showed.
The branded residences sector has exploded in recent years, fueled by ballooning wealth and a pandemic-catalyzed real estate boom. According to the Savills report, there were just 323 branded residences in 2015, a figure that has nearly tripled to 910 as of this year.
Developers are drawn to the branded residence model as a mode of attracting and building trust with buyers, who in turn pay a premium for the logo on the door. Globally, branded residences command an average 33 percent premium, the report found.
Following Dubai and Miami in branded market rankings were New York, with 32 completed projects and four projects in the pipeline, São Paulo with 15 completed projects and 15 in the pipeline, and Cairo with two completed projects and 26 in the pipeline.
The report also identified the hospitality groups leading the market with the most branded projects. Marriott dominated with more than 300 branded residences globally. Marriott, which is the parent company for Ritz-Carlton, St. Regis Hotels & Resorts, W Hotels and Edition, has numerous branded projects in South Florida, alone. Following Marriott are Accor, Hilton Hotels & Resorts, Banyan Group and Hyatt Hotels & Resorts.
The report also identified the growing share of non-hotel brands in the branded residence sector. It has expanded to include design houses like Dolce & Gabbana, car brands like Pagani and Bentley, and big names in dining like Major Food Group, best known for its Italian restaurant chain Carbone. At The Real Deal’s Miami Real Estate Forum earlier this month, developer Carlos Rosso discussed the danger of stretching the relationship between brands and condominiums, pointing to non-hospitality brands.
“A brand helps us sell because we don’t have to explain [what we’re selling],” he said. “You have to be careful not to exaggerate the concept of branding.”