Four Seasons is finally checking into standalone branded residences.
The luxury hotel management company plans to double its residential portfolio over the next five years to 7,000 units. Notably, that involves a series of Four Seasons–branded condominium projects.
While hotel condos are not new for the industry or Four Seasons, it is significant that the high-end hotel brand is extending its name to properties where you can move in, but not check in.
“The idea that Four Seasons is doing this now I think is an important juncture in branded residential,” said Peter Bazeli of Weitzman. “Because Four Seasons was a holdout.”
The first batch of these properties will open next year.
The inaugural Four Seasons condo opened this summer in London and two California-based projects in Los Angeles and San Francisco are slated to debut in 2020. Four Seasons also has plans for a fourth condo project, in Washington, D.C., that will be designed by award-winning British architect David Adjaye.
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“For us, it’s just a natural extension,” said Paul White, Four Seasons’ head of residential development, on the company’s new involvement with projects minus its famous hotel offerings.
The 58-unit L.A. project in Beverly Hills is being developed by Genton Development, with Lodestar Real Property Strategies handling sales and marketing. In San Francisco, a 146-unit tower is being developed and sold by an affiliate of Westbrook Partners.
Four Seasons will act as a property manager for the projects and will not be outsourcing service to third parties, according to a statement.
Bazeli, who has consulted on a number of branded-residence projects including the Four Seasons hotel and residences at 30 Park Place in New York City, said it wasn’t a surprising move, but it was “telling” for what it says about how brands are staying relevant and meeting customers’ demands.
“As one of the premier brands of luxury hotels — one that doesn’t even have a frequent guest program — it certainly marks a watershed,” said Russ Flicker of AWH Partners.
Flicker, whose real estate investment, development and management firm manages a portfolio of hospitality assets valued at over $1 billion, noted that big-picture hotel and residential concepts are increasingly “blending.”
As of this year, more than 400 residential projects globally are using a brand to leverage sales and demand higher prices that local competitors, according to a Knight Frank report. Of these residences, some use unconventional brands such as Versace, Armani and Porsche. But those that use hotel brands are often either housed within an operating hotel or are adjacent to the brand’s hotel.
Projects lacking a hotel are taking a risk, according to Bazeli.
“Without a hotel it will be very difficult to maintain the brand standards of service,” he explained. “Where it’s really difficult is where the flag doesn’t have an existing flag at all.”
White added that Four Seasons will be “extremely selective” in choosing partners and locations for its residential projects.
Flicker, of AWH, raised the question of whether Four Seasons would rent out its standalone condos. In a statement, the company noted that owners of its branded residences could opt in to its Four Season Private Retreats program, which would handle rentals and maintenance.
“It challenges your definition of what’s a hotel and what’s a residence,” Flicker said.
Write to Erin Hudson at ekh@therealdeal.com