Despite the effects of the pandemic, Rosewood Hotels & Resorts is maintaining pace on development, with 20 hotels and 14 residences in the pipeline. Residential development has been a particular focus as the group builds on its 15 properties in 10 countries that are paired with hotels.
“These private homes, apartments and villas offer an added layer of safety and security that we believe travelers will appreciate now more than ever before,” President Radha Arora said in an email. “In Hong Kong, for example, guests of the Rosewood Residences occupy their apartments via a private entrance and elevator. We expect that people will increasingly seek out these types of amenities and offerings as they begin to contemplate travel post COVID-19.”
Rosewood has begun reopening its hotels worldwide with heightened health and safety protocols. As of July 1, nearly half of the Hong Kong-based group’s 28 hotels were welcoming guests. Managers at the remaining properties are collaborating with local authorities on reopening dates.
In March, during the early stage of the pandemic, HOTELS spoke with Chief Development Officer Karl Bieberach-Dielman about the push in residences.
HOTELS: Hotel residences have been around a while. What is distinctive about Rosewood’s initiative?
Karl Bieberach-Dielman: Hotel residences have been around for many decades. Our hotel development accelerated over the past eight years after Rosewood was acquired [by New World Hospitality in 2011]. Interest in the brand has grown exponentially from consumers as well as the developer community.
H: What is the premise of a branded residence?
KBD: Residences provide things that high net worth individuals or families are looking for in terms of solving everyday problems, getting the privacy they need and the security they look for. Personal chefs can assist you in cooking meals or party planning. Staff members can help with shopping, grocery delivery or just running errands. We can take care of the car. This and other kinds of maintenance become important when you go to a second, third or fourth home and you’re visiting only occasionally.
H: How big is the market of potential buyers?
KBD: There’s an emerging upper class around the world, in a lot of the emerging markets. I don’t like to use the word “tribe,” but we do cater to a specific group of affluent explorers. People that are looking for that transformative experience when they stay in a hotel. They already are brand-loyal, they’ve come to love the experiences that we provide in our hotels.
H: Is this market getting crowded? Ritz Carlton, Four Seasons are known for luxury branded residences.
KBD: We’re are at an earlier stage of development compared to some of the larger luxury brands. We are younger and our projects are going to be of a smaller scale. We’re looking for the buyer who treasures going to a specific destination for holidays. It’s a lifestyle decision, not an investment decision.
H: What is the pricing?
KBD: Typically we price at the peak of the market. A Rosewood branded residence will sell at a 30% premium to a comparable non-branded unit. Our Rosewood Mayakoba on Mexico’s Riviera Maya was featured in [luxury lifestyle magazine] Robb Report with a price tag of US$9.85 million.
H: How do you decide on a market?
KBD: Our strategy is informed by what partners want to do in different locations. As a brand, we want to cover the main gateway destinations around the world. We still have a lot of runway to do that. About half our hotels have a residential component. We’re opening in Sao Paulo, Brazil, next year, that property will have for sale residences. Last year we signed projects in Houston and Doha, Qatar — established markets where we wanted to bring hotels as well as residences.
For resorts, we want to discover uncharted destinations. We are developing Rosewood Hermana Mayor in Zambales Province in the Philippines. It’s an entire island, inaccessible to the public today. It sounds distant, but it’s only two hours from Hong Kong.
H: What is your mix or ratio, between cities and resorts?
KBD: Our intention is 70% in gateway markets and 30% in undiscovered locations.
H: In the residential market you also offer rental apartments?
KBD: Right, we divide residential into two categories, branded for-sale residences, and serviced apartments for rent. Both are attached to a hotel. The apartments are popular in Asia and the Middle East. Some properties [Houston and Doha] will have both.
H: Would you ever develop stand-alone residents apart from a Rosewood hotel?
KBD: We do want to create that third category. We would be discerning as to where we would plant the first one. It would have to be in an A-plus global city where we already have, or would soon have, a Rosewood hotel.