Branded Living Could Be the Next Frontier, but Economics Matter: Amit Sinha

PROPERTY PULSE

Branded residences are emerging as a new segment in India’s luxury housing market, as buyers look beyond the home itself for hospitality, services, wellness and lifestyle experiences. But for developers, the model also brings higher costs and questions over whether the premium charged can justify the economics of the project.

“The economics of branded residences need to be looked at carefully. They can come with an 8% to 10% cost of gross sales, while the higher pricing needed to justify that cost can be 20%, 25% or even 30% above a normal product. You have to be thoughtful about whether the economics will work or not,” said Amit Sinha, MD & CEO, Mahindra Lifespaces.

He added that the branded residence concept began in the US and later expanded to Europe and Asia. Dubai is now the largest market, while China is also ahead of India. India remains at an early stage, with branded residence launches picking up over the last few years. Developers, however, need to look beyond simply attaching an international or hospitality brand to a project.

Amit noted that Mahindra Lifespaces had explored branded residences with Pininfarina, the Italian design company associated with global luxury projects, but the proposal involving design support and a royalty did not work financially for the company. Higher-priced homes would have taken longer to sell, delaying cash flows and affecting internal rates of return. He also said the experience showed why developers need to assess the financial structure of brand partnerships before entering them, as any premium created by a brand must be supported by customer demand and sales velocity.

Speaking at the 24th edition of NATCON organised by the Confederation of Real Estate Developers' Associations of India (CREDAI) in Kolkata, Amit said Mahindra is looking at a wider model that combines real estate with hospitality, experiences and services. “We don’t think about branded residences. We think about branded living,” he said, adding that this could extend to senior living, second homes, concierge services, experiences and wellness.

Location is another key factor in the model. Mahindra Lifespaces has a real estate presence in Mumbai, Pune and Bengaluru, while its hospitality business operates around 70 resorts, including a Finland entity. Amit added that city and resort markets require different strategies, with urban projects depending more on market depth and resort destinations on unique experiences.

Looking ahead, Amit sees an opportunity in destinations within two hours of major cities and airports. He said the company would focus on combining real estate development with hospitality services in locations that are accessible to urban buyers, particularly those seeking second homes or lifestyle-led properties without travelling too far.

The model is also finding scope in resort markets, with Amit seeing the next frontier in branded living as locations within two hours of major cities and airports.