Branded residences move beyond the niche of luxury housing — Knight Frank

The luxury residential real estate market in 2025–2026 is changing rapidly, moving beyond the narrow segment of high-end housing. In The Residence Report by Knight Frank, it is noted that branded residence projects are growing at an accelerated pace, with their number increasing more than threefold over the past 15 years, alongside an expanding role in the global market. This format is no longer niche and is developing its own growth logic, combining residential environments with service infrastructure. Changes in scale, geography, and project models have become one of the key trends shaping the global real estate market.

Market scale and growth dynamics

The branded residences segment is demonstrating steady and accelerating growth. According to Knight Frank, the number of such projects worldwide increased from 169 in 2011 to 611 by 2025, and is expected to rise to 1,019 projects by 2030. As a result, the overall market size between 2011 and 2030 is set to grow by more than six times. Supply is also expanding: while the market counted around 27,000 residential units at the beginning of the last decade, their number could exceed 162,000 by the end of the decade.

A key feature of the current phase has been the acceleration seen after 2023. Despite a general cooling across several real estate markets, branded residences continue to expand, driven by strong demand in the upper price segment and developers’ efforts to secure positions in the premium niche. Even taking into account the expected slowdown after 2028, the market is maintaining its growth trajectory, supported by geographic diversification and the entry of new brands, including those outside the hotel sector.

Market geography: current leaders

Today, the branded residences market remains concentrated in several key regions that were formed at the early stages of the segment’s development. North America retains its status as the largest market, primarily due to the United States, where the branded format initially evolved in close alignment with hotel operators and major developers. According to Knight Frank, the region accounts for around one third of all operational branded residence projects, enabling it for many years to set benchmarks for product quality, service standards, and pricing.

However, North America’s dominance is gradually weakening. Within the future supply pipeline, its share is expected to decline to approximately one quarter, reflecting a redistribution of investment activity in favor of other regions. Europe and the Asia-Pacific region continue to play a significant role in the market, although their growth remains more restrained and is often limited by regulatory barriers, land shortages, and complex approval processes.

At the same time, even in mature markets, branded residences are increasingly viewed as a tool for refreshing supply in the upper price segment. In cities with limited new construction, they are used to reposition existing assets and enhance their investment appeal, sustaining interest from international buyers and institutional investors.

At the same time, the market is showing a gradual increase in the complexity of project delivery formats. Alongside traditional hotel-led developments, branded residential projects with a more autonomous living function are increasingly emerging, while maintaining hotel-level service and management standards. This evolution allows developers to adapt products more precisely to local conditions and different usage scenarios, without compromising on quality or long-term asset management.

Shifting centre of gravity: the Middle East and new markets

The structure of the global branded residences market is gradually changing, with the Middle East emerging as the main beneficiary of this shift. Knight Frank highlights that the region’s share of future projects already significantly exceeds its current share of existing supply. More than 26% of projects in the global pipeline are located in the Middle East, compared with around 16% in the operational market. The key drivers are the UAE and Saudi Arabia, where the branded format is used not on a selective basis, but as the foundation of large-scale development strategies.

These markets are characterised by large-scale projects, active government involvement, and a strong orientation toward global demand from high-net-worth buyers. As a result, the region is forming a level of supply comparable in scale to North America, but with a higher concentration of new projects and more ambitious delivery timelines. It is here that branded residences are increasingly moving beyond individual buildings to become part of comprehensive residential districts and master-planned developments.

At the same time, developers’ interest is growing in new markets beyond traditional centres of global wealth. Attention is shifting toward locations with strong lifestyle appeal and limited supply of luxury housing. Destinations such as Portugal, Italy, selected markets in Latin America, and island territories are increasingly viewed as independent growth points capable of attracting international capital outside established financial hubs.

Demand and growth drivers

Growth in the branded residences segment is directly linked to global wealth dynamics and the structure of demand in the upper price segment. Knight Frank emphasises that such projects target the top 5% of the market, and in many cases the top 1%, making them sensitive to shifts in capital distribution while remaining less dependent on mass-market real estate cycles.

The number of high-net-worth and ultra-high-net-worth individuals (HNWIs and UHNWIs) continues to grow. In 2024, their combined population increased by more than 4% and exceeded 2.3 million people, generating sustained demand for high-quality residential assets. For this audience, branded residences serve not only as housing, but also as a means of preserving value, diversifying portfolios, and reducing operational risks through professional management and standardised services.

Changes in the buyer profile also play an important role. In addition to private investors, the segment is attracting growing interest from family offices and younger generations of wealth holders, for whom quality of environment, service, and long-term asset liquidity are more important than status or scale. This continues to support demand even amid slower price growth in a number of traditional markets.

Conclusion

The branded residences market is entering a more mature stage of development, where success is determined not so much by format alone, but by execution quality, service, and a project’s ability to preserve value over time. As competition intensifies, buyers increasingly assess not only brand and location, but also the underlying operating model and its long-term sustainability. In this context, branded projects supported by strong service platforms demonstrate the highest levels of resilience.

Analysts International Investment note that luxury hotel brands continue to play a significant role in the segment, remaining carriers of management expertise and internationally recognised service standards. They form the infrastructural and reputational foundation of projects, ensuring buyer confidence and predictable quality — factors that are particularly important in the upper price segment.

This approach is currently implemented only in a limited number of developments, among which the Georgian complex Wyndham Grand Batumi Gonio stands out, where the hotel brand sets management and service standards for the entire project. As a result, such developments are perceived by the market as a reliable basis for the long-term attractiveness of luxury real estate. For investors, these projects are especially valuable due to transparent operating models, professional management, and higher resilience to market fluctuations.

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