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Industry Influencers & Visionaries

5 reasons why branded residences in Dubai are a good investment

Story Highlights
  • Branded residences offer premium rental income and strong capital appreciation.
  • Average ROI ranges from 6.5% to 9%, with potential value appreciation of around 20%.
  • Association with international brands ensures consistent quality and prestige.
  • Luxury brands ensure higher standards in design, construction, and amenities.
  • Post-pandemic demand for open spaces, wellness amenities, and private facilities.
  • Branded residences offer luxury, convenience, and modern living aligned with current trends.

Investing in Dubai real estate has always been attractive, but branded residences offer a particularly compelling opportunity. These luxurious properties combine high-end amenities, sophisticated design & architecture, superior service, and robust security, setting them apart from traditional real estate. In fact, Dubai’s branded residences are increasingly popular among high-net-worth individuals worldwide, with 69% expressing interest in owning such properties, up from 59% in 2023, according to Knight Frank. Diana Nilipovscaia, CEO of MERED, highlights five key aspects valued by these buyers:

ICONIC Tower - Swim Terrace
5 reasons why branded residences in Dubai are a good investment 5

1. Rising Demand

The demand for branded residences is growing rapidly, driven by rising affluence, increased mobility and the desire of wealthy investors to expand their property portfolios. Dubai is home to the highest number of branded residences worldwide, in line with the 160% global growth in the sector. The UAE is also second behind the US for the biggest development pipelines for branded residences, with 17,000 units currently in operation and 5,000 more in development. This growth signals a robust investment opportunity with a promising future.

2. High Returns

Branded residences offer guaranteed returns, whether for rent or resale, making them a secure investment choice. Premium brands translate to premium rental income. Due to their limited supply and high demand, branded residences maintain their value better than conventional real estate. They can appreciate by approximately 20% and offer an average return on investment ranging from 6.5% to 9%, depending on whether they are utilized for long-term or short-term rentals. This ensures strong capital appreciation upon resale as well.

Leisure activities at ICONIC Tower
5 reasons why branded residences in Dubai are a good investment 6

3. International Brand Heritage

Just like a branded handbag or luxury car, a real estate product with an international resort brand consistently delivers quality, fashion, and style in keeping with the reputation and standards of international brands. These projects promise consistent quality, management, and service, regardless of location, in comparison to conventional luxury residences, which domestic or international real estate developers often develop themselves. This reliability, prestige, familiarity and trust in these brands provide peace of mind to buyers, making it an attractive long-term investment. For instance, MERED’s upcoming ICONIC Tower in Dubai Internet City has been designed by Pininfarina, a golden standard bearer in the industry with over 90 years of experience. Due to the brand’s involvement, future investors and homeowners are assured of the quality of their units.

Luxurious ICONIC Tower lobby
5 reasons why branded residences in Dubai are a good investment 7

4. Intrinsic Brand Value

Being associated with a prestigious global brand means that the project meets higher standards than typical real estate developments. Luxury brands closely control design, construction, and amenities in their projects, ensuring everything aligns with their brand identity. The involvement of renowned brands ensures prime locations, superior design, and construction quality right in the city centre. Analysis by Savills shows that the cost of developing a branded real estate project is higher due to high-class furniture standards and extensive exclusive amenities, making these properties more valuable.

5. Luxury living spaces

Post-pandemic, there has been a significant shift towards properties that offer open living spaces, wellness amenities, and private facilities. Branded residences cater to these needs with stunning views, exquisite cuisine, wellness spas, retail activities, and other attractive features that promote relaxation and well-being. The technology and innovation-friendly environment make these properties ideal for modern living, combining luxury with convenience. This alignment with current lifestyle trends ensures that branded residences remain a desirable choice for discerning investors.

Gulf Estate Gazette

Gulf Estate Gazette is a leading source for comprehensive insights into the dynamic real estate landscape of the GCC and MENA region. Our platform is dedicated to providing valuable information and perspectives for individuals, investors, and industry professionals. With a passionate team and an unwavering commitment to excellence, we aim to empower our audience with the knowledge and opportunities needed to thrive in the ever-evolving world of real estate in the Gulf and beyond.

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