'Some brands only lend their names to the property and take a royalty.'
'The developer only needs to adhere to the terms and conditions of the contracts.'
'But branded apartments from Trump are particular about every small detail.'
Tinesh Bhasin reports.
Despite a sluggish market for high-end luxury residences, US President Donald J Trump's eldest son Donald Jr is expected to launch two Trump-branded residential projects in India.
One of the projects is in Kolkata, while the other is in Gurugram.
Though branded houses are sold at a premium of 15 to 20 per cent compared to a similar property in the area, industry experts say there's still a demand for them.
"These are not mass-market products. They are for a niche set of affluent buyers who don't mind loosening their purse strings if they like the property," says Amit Oberoi, national director-knowledge systems, Colliers International India.
But are the premiums justifiable, especially when housing sales are witnessing a slowdown?
They are, especially in projects where the brand gets involved in the entire construction process, according to real estate experts.
"Some brands only lend their names to the property and take a royalty. The developer only needs to adhere to the terms and conditions of the contracts. But branded apartments from five-star hotel chains or Trump are particular about every small detail," says Anuj Puri, chairman, Anarock Property Consultants.
Brands that take part in the development ensure that the realtor meets their international standards -- be it exteriors, interiors, housekeeping services, theatre, swimming pool or gymnasium.
The property in India will not be much different from the one in any other part of the world.
Many such apartments, for example, come with concierge services and housekeeping. Five-star branded homes, which are usually constructed next to the hotel, get these services from the hotel staff.
"In such a case, a premium is justified because the apartments come with a quality of service and standard. Buyers look at the brand name and they know what to expect," says Puri.
It is similar to buying a house from a developer with a track record. Realtors such as Hiranandani or Oberoi Realty in Mumbai commands a premium over others due to their quality of construction brand, and the fact that they meet project completion deadlines.
Are branded apartments really worth it?
Branded apartments can also be an attractive investment. Many buyers don't use these as their primary residence.
A few well-known businesspersons and film actors, for example, have bought houses in a branded project in Pune. They only use it when travelling to the city.
They are also sold through invitations to maintain exclusivity.
"As of now, there are just a few completed branded apartments in the country. But due to the exclusivity, those looking for a resale would be willing to pay a premium," says Oberoi.
Most of the branded homes are in the ultra-luxury space. There are very few in the lower segments.
Disney, for example, has tied up with a few developers.
In these projects, buyers get Disney-branded accessories such as fixtures, kitchenware, furniture, beddings, rugs, tableware, fans, wall coverings, and bath accessories.
Such projects don't have exclusivity, and anyone who can afford it can buy a property in them.
In such projects, therefore, the brand is not the only trigger for the purchase. Also, developers may not even charge a premium in such projects.
IMAGE: Donald J Trump with his eldest son Donald Trump Jr announce plans of building a Trump Tower in Mumbai at a media conference on August 13, 2014. Photograph: Rajesh Karkera/Rediff.com
