Branded urban residences are gaining ground in Vietnam

Despite the Covid-19 pandemic, the Vietnamese economy, unlike most others, was able to escape a contraction in 2020 thanks to competent management of the crisis, with growth of 2.91%. According to the World Economic Outlook Report, a survey by the International Monetary Fund (IMF), Vietnam’s economic growth rate is one of the four highest in the world.

Vietnam’s economy is expected to grow five times by 2035, becoming the 19th in the world, according to the British consultancy Center for Economics and Business Research (CEBR) in its annual ranking on the growth prospects of 193 economies. Its GDP is projected to grow at 7% per year over the next five years and 6.6% over the next decade, reaching a nominal GDP of $ 1.59 trillion, nearly five times more. in 15 years, surpassing major Asian economies like Taiwan and Thailand. .

Riding the economic wave, Vietnam’s wealthy population has experienced the second fastest growing in the world over the past decade. The country’s average annual growth rate of those with net worth between $ 5 million and $ 30 million, classified as a very high net worth population (VHNW), reached 13.9% during the period 2010- 2019, according to Wealth-X, a global leader in wealth information. and information provider.

The affluent class is expected to experience strong growth over the next five years. By 2025, Vietnam will have 511 high net worth individuals (UHNWI) with net worth of at least $ 30 million each and 25,812 high net worth individuals (HNWI) with assets of at least $ 1 million, according to The Wealth . 2021 report published by Knight Frank. This translates into a growth rate of over 30% over the next five years.

The era of “brand life”

As the biggest international luxury brands make a foray into Vietnam, Vietnam’s growing wealthy and globally mobile population knows what car they want to own and what style of clothing they want to wear. They are now looking for the same brand experience in their home as well.

Branded residences, which are normally a partnership between a brand (often a hotel operator) and a developer, are not a new concept on an international or even local scale; however, this is an emerging segment in Vietnam.

In January 2021, Marriott International and Masterise Homes entered into a historic partnership to bring the hotelier’s first branded residence projects to Vietnam. The deal is expected to allow Masterise Homes to expand its developing expertise into Vietnam’s growing luxury real estate market, leveraging Marriott International’s global brands such as Marriott, JW Marriott and Ritz-Carlton in projects in Hanoi and Ho Chi Minh City. The strategic partnership has introduced Urban Branded Residences to the Vietnamese real estate market and will provide unprecedented ultra-luxury living for discerning high net worth clients.

Signature between Masterise Homes and Marriott International. Photo by Masterise Homes.

This reflects the global trend, where more than 60% of branded residential projects are in major urban centers, said Matthew Powell, director of Savills Hanoi.

“We believe this trend will prevail over the next few years, as the approach offers guaranteed superior quality, proven luxury with brand recognition and ‘standard 5 star’ service, which also reassures investors and the real estate developers themselves, not to mention the price premium attachés. We see opportunities and potential growth in this premium sub-segment, ”said Powell.

Putting Vietnam in the spotlight

The first Urban Branded Residences project resulting from the partnership between Marriott International and Masterise Homes is Grand Marina, Saigon, which comprises eight residential towers with some 4,500 ultra-luxury branded units from two Marriott International brands – JW Marriott and Marriott. It is the largest ever created by Marriott.

Marriott’s first branded residence project in Vietnam is also the most significant. Photo for Masterise Homes

With branded units starting at $ 1 million, it is on par with other branded residences in the area like The Residences at Mandarin Oriental in Bangkok or The Residences at the St. Regis Singapore.

The success of two launches in Hong Kong and Vietnam proved that a large number of customers were convinced that its quality could also be compared to branded residences in the region. Grand Marina has succeeded in raising the benchmark of luxury living in Vietnam to international standards and establishing a new real estate sector in Vietnam: branded residences. The Marriott brand association has offered global recognition not only to these residences and their owners, but also to the Vietnamese real estate market on the world map.

David Jackson, CEO of Colliers Vietnam, said: “Grand Marina Saigon, supported by Marriott International, has created the trust of local and overseas customers. The well-known brand has attracted many buyers, and Vietnamese real estate has attracted many foreign investors looking to alternative markets with higher upside potential when investment opportunities in their own country become saturated. “

Jason Turnbull, Deputy Managing Director and CFO of Masterise Homes, confirmed the developer’s plan to introduce more branded residences associated with Marriott International brands in 2021 in prime locations in Hanoi and HCMC.

“The launch of branded residential projects with world-standard design, construction and operation will bring a new level of ultra-luxury living in Vietnam and place the country’s real estate market in a higher position regionally and internationally. They will also offer a global address. for global elites and successful entrepreneurs, highlighting the opportunities in Vietnam and ultimately attracting more foreign investment to the country and contributing to stronger economic growth, ”said the head of Masterise.