Sean Woolley: Hello everybody. I’m Sean Woolley, managing director of Cloud Nine Spain. With me today, I have Jackie Waters and Debbie Lush, two of my esteemed colleagues. And they’re out and about with clients on a probably more regular basis than I am, so they’re along here to help me with this topic. I thought today we’d discuss the, is it a thorny issue? I don’t know. Branded residences. I can’t even say it. And the main reason we’re talking about it is because, well it’s a hot potato anyway, a lot of people, a lot of agents are talking about it. But also we were approached yesterday by a journalist for the Times newspaper in the UK and they’re doing a feature about branded residences and they wanted my input, so I gave them my two penn’orth, and I wanted to find out whether that was consistent with what actually you guys thought. So, branded residences, for those you not quite sure what it is. It’s where a developer will build out a block of apartments or a selection of villas and they will partner with a well-known brand. Normally a top end luxury brand, like Karl Lagerfeld, like Dolce & Gabbana, like Missoni. Normally it’s a lifestyle, fashion brand, normally. But we’ve also seen examples of things a little bit further afield than that, such as car makers like Lamborghini, which of course is all about design as well, but maybe a little bit stretched. So what they tend to do is they tend to say whatever the development name is, alongside Missoni Interiors, or by Lamborghini or by Dolce & Gabbana, blah, blah, blah, and they price it accordingly as a premium product and hope that Joe Public comes along and buys it.
Jackie Waters: Yeah.
Debbie Lush: And what do we think? Are we all waiting for the Dolce & Gabbana release to go and buy one of their apartments or villas?
Jackie Waters: As long as we get a handbag with it, yeah, we’re all right.
Debbie Lush: I’d like to see the design.
Jackie Waters: Or a Lamborghini with the Lamborghini villa.
Sean Woolley: I knew this was going to happen.
Debbie Lush: Yeah, to me it’s all about location. I think you’re talking luxury brands, you’re talking about the Marbella area, the Puente Romanos, the Puerto Banús. I think the luxury items or luxury goods, villas, shall we say, whether it’s inspired by or designed by, I think in those areas, yes, most definitely. I think even though they’re more expensive, I think it will sell because it’s got the label, if it’s in the right area.
Sean Woolley: They say that, I think the report by Knight Frank recently said that branded residences, you can expect to pay up to 30% more than the product without the brand. Experience, you’ve had direct experience, ’cause you sold Epic by Fendi.
Debbie Lush: Yes.
Sean Woolley: Just to clarify that, the Fendi part of it, I mean Fendi’s a very well known worldwide brand, very high-end, but was it furnished by Fendi or was it just kind of pieces by Fendi or?
Debbie Lush: No, it wasn’t furnished by Fendi. They got their own furniture people in and we redesigned that as well, but it was the location.
Sean Woolley: Yeah.
Debbie Lush: I mean it certainly was an interesting point and it drew their attention but it was the location as well. And the design was pretty good in that project, I have to say.
Jackie Waters: Yeah. Yeah.
Sean Woolley: And was it designed by Fendi or was it like designs inspired by Fendi?
Debbie Lush: It was things like handles on the wardrobe doors.
Jackie Waters: Sure, the F in the square.
Debbie Lush: Had their signature, things in the kitchen. There was little things around the house that you could say, “Yeah, that’s Fendi.”
Sean Woolley: So if you walked in, you’d know you were in a Fendi property.
Debbie Lush: Yeah.
Jackie Waters: But would it sell a property, having a Fendi wardrobe handle? I don’t know.
Sean Woolley: I think to the right person, it probably would, who’s literally a brand fanatic.
Jackie Waters: I think if you’re a brand fanatic, brand disciple, I mean Fendi, it’s Fendi Casa by the way. But Fendi Casa will have a tribe of followers, people who absolutely love it, and they will collect things. And if they’re looking to buy a property overseas, it might sway them to buy that. I think you are right in what you said, it’s all about location. And I think what we’re seeing is that we’re seeing a lot of these high-end brands associated with products in five star locations. So Fendi Casa with Epic was one of them. Dolce & Gabbana Design Hills, the Karl Lagerfeld Villas in a very similar location, I think will do well because the location is five star, the brand is five star, the prices are going to be high, but I think people will want a piece of that action. I think the challenge is for those developers who’ve partnered, again, with big names, and are developing five star projects with five star prices but in four star locations.
Debbie Lush: I agree. Yeah.
Sean Woolley: And I think that will be the challenge as to whether they sell. So whether the brand is strong enough to carry those sales through or where the buyers go, “Yeah, we’re a follower of Missoni, we’re a follower of Lamborghini, but actually we don’t like the location.”
Jackie Waters: Agree.
Debbie Lush: ‘Cause it’s nowhere near Puerto Banús or-
Jackie Waters: Or the completion date might be too far forward.
Debbie Lush: Yep.
Jackie Waters: Of some of the developments.
Sean Woolley: And the other thing to watch, I think, is how much involvement has the brand had? ‘Cause we’ve seen various forms of this, haven’t we? Where some of the associations, it’s obvious and it works. And you see, okay, that’s a Dolce & Gabbana that’s a Fendi Casa, blah, blah. And then others where you see, okay, how is that associated with the house? So Lamborghini was a good example. I mean now that it’s been explained to me, I kind of get it a bit more, the Lamborghini designers were heavily involved in the design of the house, but at first knowledge, you’re kind of led to thinking, “Is that just a badge?”
Debbie Lush: Exactly.
Sean Woolley: That’s the suspicion, isn’t it? And then you think, “Am I paying an extra million for a badge?”
Jackie Waters: Which really, you are.
Sean Woolley: Well, I think you’ve got to do your research. And this is one of the questions, when I went to the Lamborghini Villas launch with DarGlobal, who are a
big, big Dubai based developer, it was very glitzy launch at at Puerto Banús. Those things don’t impress me anymore, getting too old. I just wanted to collar a sales guy and say, “What’s the story here?”
Jackie Waters: Yeah.
Sean Woolley: “Where’s the Lamborghini bit?” You know, ’cause I know Lamborghini cars, I’ve never had one, I couldn’t get in them, but what’s the association? How does it translate? How is that brand translated into the design of the house? And that night I didn’t get a straight answer, which was a bit disconcerting, but I have had answers since then, and I’m kind of like, okay, I get it a bit more now. But it’s certainly something that as a buyer, you need to research whether, ’cause if you are buying it for a name, you need to be confident that that name comes through in the design or the detail.
Debbie Lush: And the resale when you go to sell it, you know, this is another thing, it’s great when it’s out there as a new product and everyone, “Oh, have you seen the Lamborghini Villas?” Well, okay, they’ve bought it now, we’re five years down the line. What do you do? Do you still sell it as a Lamborghini Villa? I would imagine you do.
Jackie Waters: Yeah.
Debbie Lush: But obviously it’s something to take into consideration.
Jackie Waters: Yeah.
Sean Woolley: Purely, I’m saying that because it’s, in my opinion, it’s not in the right area. I think the right area for the luxury items and the luxury goods is Marbella.
Debbie Lush: Bilmar, around that area, Sierra Blanca. Interesting. I mean, what it is good for I think, is the area, because these branded residences, I’ve only really seen them in places like Dubai, Miami Beach, maybe Central London, you know, rockstar kind of destinations. So to have it coming to Marbella and to have all of them kind of descending on us.
Jackie Waters: Yeah.
Sean Woolley: I mean you go everywhere now, everything’s branded. You’ve been down to Chiringuito, Puerto Romano? It’s all Fendi.
Jackie Waters: Yeah.
Debbie Lush: You go to-
Jackie Waters: Christian Dior at Cabana.
Debbie Lush: Yeah, Cabana.
Jackie Waters: Yeah.
Debbie Lush: I think it was Dolce & Gabbana was, one of them. They’re all over us at the moment in Marbella-
Jackie Waters: Perfect place though for them, really.
Sean Woolley: It’s a perfect place for it, and it’s a natural thing. But my advice to clients, and I think we’re on the same page with this, is just be careful, do your research. Find out how much the brand is involved so that you are getting brand value locked into what you’re buying. And don’t overpay for the wrong location.
Debbie Lush: And don’t just buy it ’cause it’s a brand. Make sure it’s-
Sean Woolley: Exactly. That it ticks all the other boxes.
Jackie Waters: It’s a good build and-
Debbie Lush: Oh, a bit more.
Jackie Waters: What you’re getting. Are you getting the furniture? Are you getting the wallpaper, the finishes, or are you just getting a couple of basic designs?
Debbie Lush: Yeah.
Jackie Waters: Like a door handle, as you said.
Debbie Lush: Yeah, and how much you’re paying for that privilege of exactly that package of extras or that or the furniture, whatever it is. And make sure it kind of works out well.
Sean Woolley: Absolutely.
Debbie Lush: Thank you so much.
Jackie Waters: Thank you very much.
Sean Woolley: Take care.