BERLIN — Branded residences are becoming a bigger piece of the pie for hotel companies such as Marriott International as a wider pool of buyers emerges and the proceeds from sales become more important in funding hotel development.
Dana Jacobsohn, Marriott International's chief development officer for North American luxury brands and global mixed-use, said an influx of younger residents has led the company to rethink its approach.
"What we're seeing now is a demographic shift in the type of buyer," she said in a video interview with Hotel News Now at the 2024 International Hospitality Investment Forum. "We still have a tremendous amount of luxury buyers — like our Bulgari residences and our St. Regis residences, but we're now seeing a shift to younger buyers, younger adults."
Jacobsohn said that's necessitated a shift in available amenities at some branded residences and a growth in residences at younger-skewing, lifestyle-oriented brands like W.
One example was the Ritz-Carlton Residences in North Hills, New York.
"It's a stand-alone residential project, and we thought it was going to be empty nesters," Jacobsohn said. "We found families were moving into this project, so we had to build jungle gyms."
She added Marriott has seen an uptick in interest for stand-alone residential projects and for mixed-use developments, in part because the financing environment for hotels remains more costly than historical averages.
"There is a challenging lending environment globally and specifically in the U.S.," she said. "So when you have a branded residential project co-located with a hotel, it provides diversity. What you can do with those projects — in different jurisdictions as long as it's legal — is you can use some of the deposits from the residential contracts to finance that project and help fill your capital stack."
For more from HNN's interview with Marriott's Dana Jacobsohn, watch the video above.