How Asian developers can compete with branded real estate developments
How Asian developers can compete with branded real estate developments
Are homegrown brands strong enough on their own?
Asia has been the epicenter of branded developments lately, as local property developers, spurred by the swelling tide of wealth across the continent, look to secure licencing from Western to add some shine to their projects, however tenuous those brands’ links are to real estate.
The names Versace and Armani are as much fashion labels as luxury apartment brands in the Middle East. US President-elect Donald Trump licenced his controversial name to several real estate developments in the Philippines, Indonesia, and India. Even Paris Hilton has a resort project bearing her name in the Philippines.
“What it all points to is that people want entertainment,” said Kent Wertime, co-CEO of Ogilvy & Mather Asia-Pacific. “People respond to social media. They respond to brands. Brands leverage everything what people are looking for not only in luxury, but in enjoyment and leisure and entertainment.”
Still, branded developments have been taking root in the Philippines, where both Trump and Paris Hilton have added a little stardust to real estate projects. The world’s first Forbes-branded office tower also began construction this year in Manila.
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“Newfound wealth for Filipinos mean they would definitely want the assurance of quality through names associated with popular brands,” Carl Dy, president of Spectrum Investments, explained.
While this may serve as an impetus to keep up for some local property developers, many Asian brands have stellar bona fides of their own, according to Lindsay J Orr, country head of Jones Lang LaSalle Philippines. “There’s a few good Filipino developers who have been in the business for a long, long time,” Orr said. “I don’t think they need to compete with these fancy names; it’s a bit of a marketing tool. The important thing is the actual quality and location of the building and ultimately how it’s managed afterwards.”
There is little cause for alarm bells though, as the Asian middle class has skewed toward local offerings in recent years. In a recent Ogilvy & Mather study of mid-market purchasing habits in Asia, 17 percent of buyers in the Philippines preferred local brands, while 5 percent lean toward international brands.
“There’s a great opportunity to build Asian brands,” Wertime said. “There’s no reason property developers should be any different. There’s a great opportunity in building more experiences rather than associating yourself with experiences as part of a brand-building exercise. There’s always a new wrinkle, a new social trend, a new opportunity to exploit. It’s about figuring what are those new edges that you want to aim for in the market.”
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Source: Property Report