As the branded residences sector grows, buyer awareness continues to expand and expectations increase, one of the pertinent questions being asked is how to ensure that the luxury promise being sold in relation to operation is actually delivered, particularly across complex models that blend hospitality and residential living.
Whether a guest is staying in a hotel suite or living full-time in a residence, the expectation is a seamless, consistent high-touch, five-star service. And that consistency across products is non-negotiable.
Complexity
“We need to provide the same level of service… we cannot treat either the branded residence owner or the hotel guest as second-tier,” says Laia Lahoz, chief assets and development officer at Minor Hotels
Yet delivering that consistency across two fundamentally different products - transient hotel stays and permanent residential living - is anything but straightforward.
Hotels operate within tightly controlled ecosystems: one owner, one operator, one set of standards. Branded residences on the other hand, have a far more fragmented environment, with multiple individual owners, varied usage patterns and far more personalised expectations. Yet the service must feel consistent across both.
Co-located schemes where residences sit alongside a hotel benefit from shared infrastructure, established teams and existing service platforms. On the other hand, while standalone residences remove the complexity of shared infrastructure, it introduces the challenge of creating a full hospitality ecosystem from scratch due to the absence of the immediate operational backbone of a hotel. On paper, while co-located schemes should have it easier, proximity introduces its own tensions.
The amenity conversation
Residents expect exclusivity. As a result, many operators are now deliberately separating experiences, for example having dedicated gyms, private entrances and distinct service areas to preserve the sense of residential ownership.
When it comes to amenities, Paul Rosenberg, regional vice president – development – luxury at Accor stresses the importance of making them a priority. This is at a time when increasingly, provisions such as spas, concierge desks and private lounges are no longer differentiators but baseline expectations.
This “amenities arms race” has raised the bar and delivering luxury is not tied to offering more but is more about delivering better, more consistently and over a longer time horizon. And critically, the premium that branded residences command, around 30% or more, depends on that delivery being sustained. If standards slip, so does value.
“People aren’t just buying the name on the building. They’re buying the lifestyle, the amenities, the services… that’s what drives value,” Rosenberg says
The right infrastructure
But consistent service delivery requires the right infrastructure. And that infrastructure is often underestimated. Back-of-house planning, service flows, staffing models and operational logistics become critical design decisions, not afterthoughts.
Rosenberg explains: “For example, having enough areas to provide housekeeping services, the concierge, the restaurant. If you do room service as well, how do you deliver that? And how do you connect those spaces to deliver an elevated experience?”
He adds: “And then you need to follow through with the F&B concept that you may have. Staffing is also very important and it’s key to find the right director of residences and the right people who can deliver a top-notch experience.”
Strong governance
If operational design is one layer of complexity, ownership structure adds another.
David Grossniklaus, CEO of Luxury Hospitality Advisory points to the inherent tension within the multi-owner model. While delivering luxury requires continuous investment including refurbishing public spaces, maintaining amenities and evolving service standards, the ability and willingness of individual owners to fund that investment is far less predictable over time.
What works at the point of sale does not always hold five or ten years down the line. Changes in personal financial circumstances or wider economic downturns can leave some owners unable or unwilling to contribute to major capital expenditure, creating risk not just for the asset but also for the brand. This is where governance becomes critical.
“You need to have clear and strong agreements in terms of how to manage the homeowner association’s voting rights. Documentation is very important to ensure that people are contributing their fair share, there are enough reserves, and in the case of defaulting parties, there’s recourse,” Grossniklaus says.
Structured reserve funds, clearly defined voting mechanisms and enforceable legal frameworks are essential safeguards. Without them, the failure of even a small number of owners to meet their obligations can undermine asset quality, erode service standards and ultimately dilute brand value.
Ultimately, branded residences sit between hospitality and real estate. But unlike hotels, where luxury is experienced temporarily, residences require it to be delivered continuously for owners while in some cases, at the same time - and on the same level - to transient guests. In the end, execution is everything. Real success when it comes to delivering luxury in branded and the resultant maintenance or accretion of value will be down to not just the brand on the building but also the operation behind it.