Thailand has been hailed as a paradise of sun, sea and cultural diversity and as such it is one of the most sought after tourist destinations in the world. Branded residences are also an emerging trend in real estate in the Kingdom, which combines luxury, exclusivity, and investment opportunity. Although Phuket has long been the leader in this market, developers and investors are currently turning their attention to less popular areas, discovering some of the hidden treasures of the country to pursue the next round of opportunities.
This post discusses the meteoric rise of branded residences in Thailand, the move to alternative destinations and what makes these emerging luxury markets so attractive to invest in.
What Are Branded Residences?
In simple terms, branded residences are high-end properties that are marketed using the brand name of a reputable international hospitality, fashion, or design brand. These houses are equipped with all the high-end finishes, services, and cachet that the associated brand provides, making them very attractive to high-end consumers who want prestige, quality, and convenience.
Thailand has adopted branded residences as a component of its luxury real estate market. Five-star management service in branded villas, the promise of a lifestyle in line with big names such as Banyan Tree and Four Seasons, these properties are not just a home, but a ticket to a luxurious, highly curated lifestyle.
Why Are Branded Residences Growing in Popularity in Thailand?
Thailand is experiencing rapid growth in its branded residences sector, fuelled by several key factors
A Booming Tourism Industry
Thailand drew over 40 million international visitors in 2019, and these numbers are projected to double to 80 million by 2028. This significant influx of tourists has created an appetite for long-term living options that reflect the luxury and standards many visitors associate with the country’s famed resorts and services. Branded residences bridge the gap between five-star hotel experiences and private homeownership, making them an attractive option for affluent travellers considering extended stays or even permanent relocation.
Demand for Long-Term Luxury Living
Global trends are shifting. Travellers no longer just want a short-term getaway but increasingly aspire to ‘live the dream’ in a destination like Thailand. Whether inspired by remote working opportunities or lifestyle upgrades, many are transitioning from being vacationers to making a long-term commitment to this tropical paradise.
Global Market Recognition
Phuket is now the fourth-largest market worldwide for branded residences, behind giants like Dubai, New York City, and Miami. This puts Thailand on the global map as a key player in the high-end real estate market, boosting its appeal to discerning investors from around the globe.
Why Developers Are Turning to Lesser-Known Destinations
While Phuket and Bangkok have historically dominated Thailand’s real estate market, skyrocketing land prices in these regions are spurring developers to look elsewhere. This shift is leading to the discovery—and strategic development—of lesser-known destinations.
Surging Land Costs in Hotspots
Beachfront land in Bang Tao, Phuket, reportedly sold for THB 7.5 million per rai in 2004. Today, it has ballooned to over THB 100 million per rai, underscoring the challenges for new investors entering these established markets.
Hidden Gems and Untapped Potential
To achieve a “first-mover” advantage, developers have begun to explore regions like Khao Lak, Koh Lanta, and Chiang Mai. These destinations represent an opportunity to tap into lower land costs while delivering unique natural landscapes and cultural authenticity that can’t be replicated in overdeveloped tourist centres.
Spotlight on Key Emerging Locations in Thailand
Here’s a closer look at some of the emerging destinations in Thailand that are stepping into the spotlight as potential hubs for branded residences.
Khao Lak
Located about an hour’s drive north of Phuket, Khao Lak offers tranquility, pristine beaches, and lush mountainous scenery. Unlike the bustling nightlife that defines Phuket, Khao Lak is an ideal retreat for families and retirees. Recent developments include several boutique resorts transitioning into branded residences to meet growing demand.
Koh Lanta
This idyllic island, situated in the Andaman Sea, boasts some of the quietest and most beautiful beaches in Thailand. Positioned as a more relaxed alternative to Koh Samui, Koh Lanta is becoming a preferred location for boutique-branded residence projects. With its eco-friendly vibe and close-knit community, it offers an appealing lifestyle for sustainability-conscious buyers.
Chiang Mai
While most branded residences are concentrated along the coast, Northern Thailand is entering the equation. Chiang Mai, with its cool weather, rich history, and burgeoning creative community, has expanded its appeal to second-home buyers. The region is particularly interesting for wellness-focused branded properties that highlight Thailand’s longstanding traditions in holistic living.
Sichon
A hidden gem in Nakhon Si Thammarat province, Sichon is gaining serious attention. Banyan Tree Residences Sichon, set to launch in mid-2024, promises pristine beachfront settings combined with modern luxury and services. With new infrastructure projects such as the expansion of Nakhon Si Thammarat Airport, Sichon is poised to become a significant player in the branded residences market.
Banyan Group’s Expansion Strategy
Banyan Group, a global giant in the branded residences sector, has been instrumental in leading this diversification across Thailand. Their expansion into emerging areas like Sichon and Khao Yai exemplifies their forward-thinking strategy to capitalise on untapped potential.
For instance, their Sichon project integrates five-star services, stunning design, and a competitive price point, providing a strong value proposition for buyers seeking both luxury and investment security.
Why Invest in Thailand’s Branded Residences?
For investors, Thailand’s branded residences bring advantages that go beyond the exclusivity of luxe living. Here’s why it’s worth considering this market
Thailand’s growing reputation as a sought-after long-term destination makes it an attractive option for property investment, with branded properties offering promising returns and steady appreciation over time. Investing early in emerging areas presents a unique opportunity to secure properties at significantly lower prices compared to well-established hotspots, providing a valuable first-mover advantage. Additionally, properties developed by globally recognised and trusted brands come with the added benefits of increased resale potential and a sense of reliability, making them a secure choice for investors.
That said, risks like market fluctuations and economic conditions warrant thorough due diligence.
Enriching Local Communities
Branded residences not only enhance investor portfolios but also benefit surrounding communities by creating jobs in fields like construction and property management, boosting tourism through high-end developments that attract affluent travellers, and increasing tourism revenue in emerging areas. These projects often lead to improved infrastructure, such as upgraded airports, roads, and local amenities, providing long-term advantages to the host regions and their communities.
That said, developers must address challenges such as environmental impact and preserving the cultural essence of these locations.
A Look Ahead at Thailand’s Branded Residences Market
The branded residences market in Thailand shows no signs of slowing. Emerging trends include
Greater emphasis on environmentally sustainable developments, with builders and developers integrating eco-friendly materials, renewable energy sources, and green spaces into their projects to reduce environmental impact.
Increased focus on hybrid properties that seamlessly combine work, leisure, and wellness, offering flexible workspaces, recreational facilities, and wellness amenities to cater to modern lifestyles.
Expansion beyond traditional coastal regions, with significant growth in urban areas like Chiang Rai and Khon Kaen, where developers are tapping into untapped potential and catering to the rising demand for housing and commercial spaces in these cities.
Unlock the Potential of Thailand’s Hidden Gems
Thailand has lesser-known luxury destinations that are becoming the next frontier with the thriving branded residences market in Phuket offering a proof of concept. These destinations range in pristine beaches to peaceful mountain resorts, and they promise a good mix of exclusivity and unexplored potential.
Whether you’re a seasoned investor or a dreamer seeking your perfect second home, now is the time to explore Thailand’s burgeoning branded residences market.
