Branded Real Estate – The Next Big Idea in Luxury Living

What does sports have to do with a luxury property development? A lot, it seems, according to Total Sports Asia (TSA), a sports branding and marketing company which has created a new form of licensing that did not exist before. By Shoeb Kagda

What would it be like to live the lifestyle of tennis superstar Maria Sharapova? Or to enter the inner world of F1 racing legend Michael Schumacher?

In an age when super premium properties abound and price is no longer a defining factor for Asia’s super-rich, property developers and buyers are searching for something different. They are not looking for just another expensive apartment with luxurious interior and fittings but something that transcends them.

This is why celebrities, sports stars and luxury brands are endorsing properties around the world, such as Virgin in Moscow, Versace in Dubai or Bulgari in London. Branded properties are also becoming highly popular and marketable in some of Asia’s fastestgrowing cities. From Dubai to Mumbai to Shanghai, branded real estate (BRE) is on the rise. But notes Marcus Luer, group CEO of Total Sports Asia (TSA), it is not easy to find the right brand which can translate into a successful property development.

marcus

What would it be like to live the lifestyle of tennis superstar Maria Sharapova? Or to enter the inner world of F1 racing legend Michael Schumacher?  In an age when super premium properties abound and price is no longer a defining factor for Asia’s super-rich, property developers and buyers are searching for something different. They are not looking for just another expensive apartment with luxurious interior and fittings but something that transcends them. This is why celebrities, sports stars and luxury brands are endorsing properties around the world, such as Virgin in Moscow, Versace in Dubai or Bulgari in London.

Branded properties are also becoming highly popular and marketable in some of Asia’s fastest growing cities. From Dubai to Mumbai to Shanghai, branded real estate (BRE) is on the rise. But notes Marcus Luer, group CEO of Total Sports Asia (TSA), it is not easy to find the right brand which can translate into a successful property development. Luer got his start in Malaysia in 1977 as a sports branding and marketing expert. “The idea was to be a little IMG,” he said, referring to the global sports and media conglomerate. “I got my start in the media world, handling television distribution rights.” His first move was to try and take over the Malaysian football league for 35 million ringgit ($10 million). He succeeded but the 1998 Asian financial crisis put a spanner in his plans and he was forced to sell the rights to the league to Dunhill.

The entry into sports, however, was to prove highly strategic. In 1998, Malaysia hosted the Commonwealth Games and Luer managed to secure sponsors. From 2000 to 2007, he held the rights for World Wresting Entertainment (WWE), in the process propelling TSA into the major leagues. “Over the seven years, we signed $170 million in rights and our revenue went from $300,000 to $20 million,” Luer noted. “We had 10 crazy years of growth and then came the 2008 financial crisis and we had to retool the company again.”

A new focus

After the fall-out from the Wall Street meltdown, as sports marketing and sponsorships went through a lean spell, Luer and his company started to look for new opportunities. TSA looked at how it could leverage the power of sports and the fan base which sports has to enter new markets. “Corporate brands have very little following and loyalty is hard to earn,” he noted. “But in sports, once you support a team or a player, you tend to stick to it and that is the power we are tapping into and leveraging for our corporate clients.” That is how BRE started to take shape and develop. “We started to translate everything we learned  in sports into property by tapping into super-brands such as Ferrari, Schumacher, Armani,” Luer said. “These are brands everyone recognizes. They are not names that belong to developers.” He coined the phrase “Branded Real Estate” to describe projects that incorporate all the emotional elements of a Sharapova or a Schumacher attached to it. To have a successful BRE, however, customers must also buy into the brand on an emotional level. “The property must reflect their personality and a certain image is created in the customer’s mind.” Most importantly, BRE are able to command a premium price in the market, usually 20% to 30% above market price, claims Luer. “So it’s not only the CMO (chief marketing officer) who loves BREs but the CFO (chief financial officer) also understands the value.”

He added that most often the cost of adding a brand to a property can be between $10 and $100 per square foot to the developer. “But if the revenue is $100 per square foot to the bottom line, we can easily add $20 million to the project.”

A smash hit?

It is not easy to identify a brand that can sell property. Some readily come to mind such as Ferrari but what do Sharapova or Schumacher add to the mix? After all, they are sports stars and not property developers. “When we look at brands, there is a process we go through to identify what is the developer’s vision,” noted Luer. “For example we used the tagline Discovery Living when working with Discovery Channel and when we were talking about CNN Tower, the tagline was ‘Be the First to Know’.” The question, he adds, is always what is the underlying message of the project. So when TSA was working on the US Open Tower in the heart of Mumbai, it was about having a New York lifestyle in Mumbai. Luer admits that the message is not always obvious such as the Sharapova Tower in New Delhi. “The more emotion you have, the higher the risk so we have to have a balance,” he said. Ballet by Sharapova features creative inputs from Maria herself, from communication up to structural designs.

The creative development embodies the characteristics that define Sharapova as a globally renowned player. A landmark, the development is complete with recreational facilities chosen by the tennis player, including a Maria Sharapova Tennis Academy and Love by Maria – an exclusive designer sportswear and accessory lounge created by the tennis star. The test of just how successful the BRE is simple. “When people ask you where you live and if your address is easily recognizable, then it means we have achieved our objective.” TSA does not have any BRE projects in Indonesia at the moment but Luer is confident that as the idea gains momentum, it is only a matter of time before Jakarta or some other major Indonesian city will have its own iconic branded property.

Link to the original article here

About Total Sports Asia

TSA is a fully integrated Sports Marketing business offering media rights distribution, TV production, events management, sponsorship and consultancy services to its clients working with Asian and international rights holders, corporations, government bodies, advertising agencies, sports federations and media platform owners. TSA’s strength lie in creating innovative ways to bring sports properties closer to the fans and consumers while generating maximum exposure and demand for its clients’ brands.

www.totalsportsasia.com
www.brandedrealestate.com

Advertisements