For developers and brands who are getting involved with branded real estate, it is not just about selling a property, it is mostly about highlighting and selling the lifestyle and the intangible benefits of the property. Savills Branded Residences’ 2019 Spotlight report shows that the number of branded real estate schemes has surged by almost 200% within the last decade. Last year, 65 branded residences projects were opened and about 70 new branded residences projects are due to open in 2020.
The global branded residences sector has more than 60 different developers that manage more than 100 brands in between them. Hotelier, Marriott International (NASDAQ:MAR) is the largest player in the branded residences sector, some of its iconic branded residences include Ritz-Carlton, St. Regis, W, and Westin residence.
Hilton Hotels Corporation (NYSE:HLT) also has a strong presence in the branded real estate industry and some of its branded residences include its Waldorf Astoria Residences, Conrad condos, and apartments, and Hilton Asunción.
In the year-to-date period, both Marriott and Hilton – and potentially all hotel chains- have recorded significant declines in their top and bottom lines as the hospitality industry takes a hit in response to COVID19.
Yet, branded real estate can help hoteliers maintain a measure of stability in revenue because they have medium-to-long term occupants. While many people may hold off traveling and staying in hotel rooms because of the global lockdown, branded residences continue to earn revenue because they tend to maintain decent occupancy rates. Hence, it is not surprising that other hoteliers such as Mandarin Oriental are making inroads into the branded residences industry.
Interestingly, innovative projects such as LightArt are also starting to make a mark in the branded real estate sector. We caught up with Tom John Light, a serial entrepreneur who has been involved in branded real estate projects since 2013 and has now founded LightArt to deliver collaboration between modern art and the contemporary design of apartments and their buildings.
In this interview, he shares wisdom from his entrepreneurial journey, his plans for LightArt, and his expectation on the future of branded residences.
How would you define the concept of branded real estate properties?
Branded real estate adapts a residential real estate project into a brand with its design, style, and quality. A run of the mill luxury project can only create a certain amount of interest, branded real estate creates a unique building which gives it a massive selling advantage which benefits and creates value both for the developer and the tenants.
Each brand brings with it, its design and living experience, which is sought after by many and creates an attraction that is unique within the city.
We understand that you have built hundreds of housing units in branded residences around the world especially in Europe and Asia, how is the idea of branded real estate defined across generations and geographies?
Branded real estate is recognized and in demand in all countries around the world. People identify themselves in brands and want to be part of it and its activities. When a brand launches a project, it adapts its branding to the country and its cultures. In Dubai for example, the effect will be more subtle and respectful, whereas in the far east the brand will be louder and more extreme. In Vienna, the focus of any brand would be love & romance.
The beauty of art is that its experience is so dynamic, it is loved by all walks of life, and it is easily adaptable to the culture and its surroundings.
Can you provide more insights on your plan to leverage branded real estate to promote well-known artists and give an opportunity to lesser-known artists through LightArt?
What is the most powerful tool for an up and coming artist? Exposure! An artist can work for months and create the most amazing piece, however, if it is hanging up in someone’s dining room or in a small art gallery, it will not help them grow.
Having their work on the side of a tower which is an icon in the city, provides the artist with exposure, which is priceless.
At LightArt we pride in our world-famous artists, however, we believe in helping less-known artists as well. Therefore, we set aside 25% of all our artwork to help promote up and coming artists.
Tom John Light, LightArt’s founder
In your previous role as Senior VP of Business Developments at FashionTV, you were involved in the development of real estate projects such as FashionTV Residence, FashionTV Hotels. Now, you have launched LightArt, what fuels your passion for the real estate industry?
I have been involved in the development of hundreds if not thousands of apartments, but the passion continues to grow. An apartment to some developers is just four walls and a roof, but to me, it is a home for someone, a place where dreams are created, experiences are lived.
To be a part of that journey is what pushes me to continue. In the modern world, we have evolved into a generation that every small product is created by luxury brands, but strangely, real estate got left behind. My passion and goal is to revolutionize the industry and to give people a living experience that they can identify with.
What can you tell us about LightArt’s first project?
We have a few projects in the pipeline, but our debut project to be built is in Florentine in Tel Aviv. If you have ever walked through the streets of Florentine, you will understand that there isn’t a neighborhood more suited to LightArt. Florentine is a combination of old and new, retro, and modern, with street painting covering many public areas alongside modern new residential buildings. LightArt combines the two and is creating an icon that will represent the neighborhood with its culture and rich history.
This specific project has been driven by Gary Ghozlan - CEO & Partner of LightArt. Gary has over 15 years of experience in the development of real estate and is a council member of the Herzliya municipality. Gary brings to LightArt not only his vast experience in real estate but his experience & knowledge in the world of art. Gary created Bascula, an Urban Circus which combines Art & Circus to create a one of a kind experience for the performer and the audience.
What were the biggest lessons you’ve learned in your journey to create emotional connections between art and real estate for investors and art enthusiasts?
LightArt has taught me that you can achieve everything when you are unique & genuine. Creating art is unique, you take a canvas and you create something new. It is authentic, genuine and one of a kind. Art can never be copied, and you must continuously recreate yourself again and again. Seeing that emotional experience people have when art combines with real estate is phenomenal. The response and effect it has had on people in the industry is breath-taking.
How well do you think the real estate industry is leveraging marketing to appeal to changing consumer tastes and match new expectations?
In the last two decades, real estate prices have continued to go up, but you get no more value. Nicer marble, nicer curtains maybe, but the industry has been stuck in its design for years. Branding and LightArt are revolutionizing the industry of real estate. With the branding and its design, you get massive value for your apartment.
In the past you would make your decision on technical statistics, how many meters, what floor, etc, but now we have made it an emotional decision, a decision based on “what experience am I getting with my purchase”? We are revolutionizing the market and setting the bar extremely high.
How can project developers help buyers define their lifestyles through their property and art purchases?
When developers team up with famous brands, they offer potential clients an opportunity to connect long term with their brand and its style. Art has the power to connect emotionally with the property unlike anything else. The power of art in real estate is not a new concept. For years, real estate developers have used art as an integral part of their design and sales pitch to attract buyers and investors. LightArt takes it up a notch and combines the two as one to give an experience that lasts a lifetime.
How do you expect the LightArt to evolve in the future?
This is just the start of LightArt. By the end of 2020, we plan to have multiple developments signed and construction started in at least 2 of our projects. In the coming years, LightArt will be creating their iconic building in every capital around the world. LightArt buildings will be massive attractions for art lovers of all types, for years to come.