Text Andres DAMM
A home in a luxury hotel can not only be a comfortable place to live, but can also be an interesting investment under certain circumstances. In the last ten years, demand for private residences in five-star deluxe hotels that are integrated into a hotel has risen by almost 250 percent. Mandarin Oriental, Four Seasons, Ritz Carlton—In cities such as New York, London and Dubai, the most illustrious names in the hotel industry are competing for potential real estate investors with purchasing power, while development companies are outdoing each other in terms of furnishings and service standards, thus setting completely new benchmarks.
As with so many innovations, the concept of »private residences was born at the hotel« New York City. In 1927, almost 100 years ago, The Sherry-Netherland on 5th Avenue was the first luxury hotel to offer apartments for sale in addition to regular hotel rooms. All hotel services such as room service, cleaning and concierge were available to the owners. The hotel still exists today in this mixed-use form. Among other things, a 700 square meter apartment with three terraces, 15 rooms and a view of Central Park is currently for sale for 35 million dollars. However, 30 square meter studios, which are located between the regular hotel rooms, are also for sale for half a million dollars.
For more than 70 years, The Sherry-Netherland was unrivaled worldwide. From the end of the last millennium, the exclusive living experience in New York City became more widespread and experienced its first boom—today, countless hotel groups offer apartments for sale in addition to hotel rooms at a daily rate. The concept of private residences was not only integrated directly into the project planning for new projects such as the Four Seasons in the Financial District, but various long-established grandees of the hotel industry also subsequently embraced the trend. In some cases to the annoyance of regular customers: Guests at the Waldorf Astoria were furious about the fact that, following extensive renovation, the top floors of the hotel tower would only be available to buyers and not to travelers—a stone’s throw away, while The Plaza was criticized after the general renovation for the fact that only the owners of the new and extremely successfully marketed private apartments would now be able to enjoy the most beautiful views of Central Park.
A special address — AMAN New York is located in the venerable Crown Building on the corner of 5th Avenue and 57th Street.
The latest addition to New York’s exclusive club of hotel towers, which also offer private residences, is the Aman New York. The venerable Crown Building on the corner of 5th Avenue and 57th Street is one of the city’s most prestigious locations. And as we have come to expect from the highly exclusive hotel group, its second city branch also focuses on superlatives à la Aman, including the residences offered for sale. When the penthouse found its buyer in spring 2022, the highest real estate deal of the year to date was sealed at 75 million dollars. As discretion is part and parcel of doing business in these price spheres, there is usually little information about the buyers or the details of the premises, but the private Aman Penthouse is said to boast a saltwater swimming pool and several open fireplaces.
From custom-made furniture to a virtuoso lighting design and the perfect concierge service—, living in your own four walls is transformed into an enhanced experience at Aman New York.
However, it is not only the luxury facilities, which are certainly also available in this form in other full-service residential towers, that persuade customers to stay permanently at Aman, Mandarin Oriental or Four Seasons. Part of the investment is rather the respective style and atmosphere of the hotel and not least the image of the respective managing hotel group built up over many years, which buyers are happy to pay a premium for. The interior design and services that you acquire at these exclusive addresses can hardly be experienced in an ordinary, nameless New York skyscraper.
In the case of the Aman New York, the residence owners all automatically receive a club membership, which offers access to all of the hotel’s facilities that are otherwise reserved for guests only. »In addition to the two restaurants Arva and Nama, other amenities include the spa, which extends over three floors, and an in-house jazz club—Residence owners benefit from preferential access«, a spokesperson for the group explains. Those who can count themselves among the owners of an Aman New York residence also acquire the freedom of no longer having to choose between a glamorous day and evening program or domesticity—The answers to these and many other time-consuming questions are already deeply embedded in the DNA of the idea behind it and are included in the price.
The Covid pandemic was probably one of the reasons why demand for exclusive properties that combine cocooning and luxury has risen so exponentially, especially in hard-hit cities such as New York. It therefore stands to reason that New York City will not remain the only city in which Aman offers urban oases with its residences; hotels with adjoining luxury apartments will soon be opening in Bangkok and Miami too. The group’s spokesperson emphasizes: »European cities are also a possibility for future projects. For Aman, however, it is essential that the location and type of property provide the opportunity to create a hotel that stands out from all existing hotels and is therefore absolutely unique. In addition, the values and standards of the group must of course be reflected in every future project. Our customers, whether hotel guests or residence owners, are less definable by classic demographic factors such as age or profession. Aman is home to like-minded people who are inspired by travel, prioritize wellbeing and want to experience local heritage and culture while staying in an exceptionally designed environment.«
Dramatic villas built into the cliff at the luxurious One&Only Mandarina resort.
The concept of private residences with hotel service is no longer a purely urban phenomenon. The One&Only Group, for example, offers villas for sale in various of its luxury resorts, including on the Mexican Nayarit coast, an hour north of Puerto Vallarta. Surrounded by lush tropical greenery, the One&Only Mandarina offers affluent customers the opportunity to purchase villas dramatically built into the cliff, which are generously proportioned with four to eight bedrooms. The design of the vacation homes is just as elegant as the hotel in which they are integrated. Infinity pools and sea views come as standard, and each villa is unique thanks to its architecture, which is adapted to the respective location.
»Our Private Homes give us the opportunity to expand the experience of the One&Only brand. An explicit wish of our regular customers to be able to enjoy the atmosphere and design language that was previously only experienced on vacation in a hotel in a much more private setting, their own vacation home«, describes Jonathan Tomlinson, Senior Vice President Private Homes of the Kerzner International Group, which also includes One&Only is the origin of the concept. Accordingly, the typical residence owner is also very similar to the group’s hotel guest. »The desire for tranquillity and closeness to nature without sacrificing all conceivable amenities is what unites all our customers and what we want to offer them. We have customers from all corners of the world, and in many places we have a local clientele as well as international buyers.« We offer One&Only In addition to all the facilities and services that are available to hotel guests, the residence owners are also offered a tailor-made program. There is also a tailor-made program for the exclusive circle of owners, including a global concierge service.
In principle, One&Only Private Homes owners have the choice of whether they want to participate in a rental program or prefer to celebrate maximum privacy, with the majority of owners having their residence rented out by the hotel company at times when they are not on site. The resulting profitability of the investment is a convincing sales argument, especially as One&Only makes the temporary use by third parties as comfortable as possible for the villa owners. The hotel management takes full responsibility for marketing and letting. »Of course, when villa owners rent out their property as part of One&Only, it is important that their property reflects the identity of the resort, but we offer storage facilities for private items that can be safely stowed away during rental periods. This allows owners to ensure maximum personalization of the property without renters feeling that they are not staying at one of our resorts«, explains Tomlinson.
One&Only Private Home owners also have the option of living in their property even when the associated hotel is closed for seasonal reasons. »Even for resorts that are only open seasonally, such as our Greek hotel Kea Island. We provide permanent access to the villas and guarantee that service staff will also be on site in winter to ensure that the expected standard is maintained during your stay in the vacation home.« As a real estate investment is a long-term affair, the group guarantees the owners of the villas long-term contracts with the hotel operating company. This ensures that the services and facilities acquired with the hotel will be available for at least several decades. The property itself, i.e. not only the respective villa but also the defined plot of land, is officially owned by the Private Home owner, which guarantees independence from the hotel business.
The OWO Raffles, London. OWO is short for Old War Office – Winston Churchill once had his office in the building, which was built in 1902 and has now been completely renovated.
While private residences marketed by luxury hotels are still a rarity in continental European cities, competition is already fierce in the UK’s capital, London. The OWO Raffles hotel will open here in spring 2023, and the sales phase for the adjoining private residences has already begun. The investor group is also promising an exclusive and exceptional living experience here and is using the history of the property in particular as a unique selling point. OWO is short for Old War Office; Winston Churchill once had his office in the building, which was built in 1902 and has now been completely renovated. Today, 85 luxurious residences are on offer, while the Raffles Hotel, which is also integrated into the building, is responsible for the service provided to future owners.
The Raffles Hotel, which is also integrated into the hotel, is responsible for the service of the 85 luxurious residences.
Thanks to the architectural style of the Edwardian era with its opulent stucco and various antique architectural details, buyers can be sure that the apartment they purchase is absolutely unique. While the competition offers residence buyers the service and luxury of the adjoining hotel as a selling point, the development of the OWO Residences went one step further and created separate communal facilities that are specifically reserved for residence owners. For example, there are various lounges, a gym and a pool to which the hotel guests next door do not have access, while apartment owners can also switch sides to take a dip in the hotel pool for a change.
With their definition of luxury, which goes beyond the purely material elements, residences attached to hotels really do seem to strike a chord with the times. Living within one’s own four walls is transformed into an extended experience that encompasses everything from custom-made furniture and virtuoso lighting design to perfect concierge service. The most successful hotels are characterized by the fact that they create their very own cosmos. Being able to reside in this cosmos permanently and unite it with one’s own reality of life is understandably in great demand, however comparatively small the target group with the corresponding purchasing power may be.
ARTICLE FIRST PUBLISHED IN CHAPTER №VII »NORMAL THINGS« — WINTER 2022/23
