The six Cheval Blanc Private Residences, designed by Foster & Partners, for LVMH, part of a new £500m 83-bedroom 5-star hotel on Grafton Street in Mayfair is the latest project in the planning pipeline to underline the demand for luxury branded homes with hotel amenities in Mayfair, Wetherell said.
Wetherell highlight that branded residences with hotel amenities have historically flourished in Knightsbridge and Whitehall but have been undersupplied in Mayfair. Wetherell say that the demand for branded residences like the new Cheval Blanc Private Residences is being driven by the significant growth in Mayfair of wealthy households comprised of younger residents, typically aged under 45, who want to live newly built homes which benefit from hotel style leisure amenities.
Wetherell have just published their latest Mayfair market intelligence report entitled “Who Lives in Mayfair” (May 2019) which shows that 60% of the residents in Mayfair are aged below 44; with the luxury property sector dominated (35%) by wealthy 25 to 39-year-old ‘Millennial’ households. It is this younger demographic who are helping to drive the demand in Mayfair for contemporary new build homes with leisure facilities.
Wetherell highlight that in Knightsbridge the development of branded residences started in 2007 with examples including the Bvlgari Private Residences & Hotel, The Knightsbridge apartments, the Trevor Square apartments with Harrods amenities and One Hyde Park.
In Whitehall the development of branded residences started in 2011 with examples including the Corinthia Private Residences & Hotel, the ME Hotel and Marconi House Residences and the Great Scotland Yard Hotel.
However, Wetherell reveal that over the last three years the situation in Mayfair has changed dramatically with developers putting in planning applications for luxury homes, and Mayfair has now overtaken both Knightsbridge and Whitehall in the development of branded luxury residences.
Using development data provided by Dataloft, the market intelligence group, Wetherell say that Mayfair now has 15 new branded super-luxury residential developments with hotel style amenities delivering 501 new luxury residences. Around 25% of this new pipeline is now build complete, with the rest under construction.
Wetherell calculate that Mayfair has 4,360 established residential homes, so these new branded homes will increase the number of addresses in Mayfair by 11.5% and residential occupancy by 25%.
Examples of these Mayfair projects include completed schemes such as Clarges Mayfair, 20 Grosvenor Square and The Connaught Hotel Private Residences, and pipeline projects including One Grosvenor Square and Audley Square.
Wetherell highlight that residences within Mayfair’s new luxury developments are typically priced from £2,350 to £5,500 per sqft, with sales typically achieving a significant price premium over secondhand stock in the same location due to exceptional specification and build quality and the facilities offered.
Wetherell say that the demand for branded residences in Mayfair is being driven by young domestic and international buyers, typically aged under 45, who want to live newly built homes which benefit from hotel style leisure amenities.
The younger wealthy buyers purchasing branded residences in London are typically from Asia, the Middle East and Africa (the three regions accounting for 65% of all buyers) and like to buy luxury branded clothing, furniture and accessories. The branded residences are an extension of their existing purchasing preferences. Wetherell highlight that Mayfair, with the highly cosmopolitan makeup of its households, provides a perfect catchment for branded residence sales. There are now residents from over 42 nationalities, with over 60% of Mayfair’s residents now born overseas, up from 49% back in 2001.
Over the last 15-years the biggest rise has been residents born in and the Middle East. Wetherell highlight that Mayfair is now the “London address of choice” for wealthy residents from Qatar, Saudi Arabia, Kuwait, Abu Dhabi, Nigeria and Russia: the elite in each of these six counties has a high preference for spending on luxury branded goods.
Wetherell highlight that Mayfair is undergoing a huge demographic transformation. Between the 1950s and 1980s, the average age range of owners in Mayfair was 55 to 75-years of age, with properties often inherited rather than purchased. In the last 10-years this demographic has changed completely.
Now 60% of the residents in Mayfair are aged below 44; with the luxury property sector dominated (35%) by wealthy 25 to 39-year-old ‘Millennial’ households, set to rise to 48% by 2021. Mayfair households are now typically young bachelors/bachelorettes, with 55% of households now consisting of single people. Modern Mayfair is also highly cosmopolitan with over 60% of residents now born overseas, up from 49% back in 2001. Wetherell highlight that whilst some of these wealthy 25 to 39-year-olds choose to purchase one or two bedroom apartments in Mayfair, many also prefer to rent.
Wetherell calculate that these demographic trends are set to continue. By 2028, 30% of Mayfair’s residents will be wealthy young people aged 18 to 24 “Generation Z’ up from 13% currently. These young affluent households are much more likely to rent luxury homes rather than purchase.
Peter Wetherell, Chief Executive of Wetherell said, “We have seen a significant growth in affluent households aged below 44/45 in Mayfair and these younger residents are choosing to purchase or rent contemporary style one or two bedroom apartments in newly built luxury developments. These younger households like modern homes with contemporary interiors and they also seek apartment schemes which provide private health clubs with facilities such as gymnasiums and swimming pools.”
Wetherell highlight that three out of five adults (60%) in Mayfair spend on average at least 2.5 hours per week doing physical/gym activity. This can be compared to a gym usage rate of just 15% for residents in the rest of the UK (State of the UK Fitness Industry 2018).
Wetherell highlight that in order to appeal to the new generation of younger residents, most of Mayfair’s new branded developments offer a gymnasium, health spa and swimming pool.
Examples include 20 Grosvenor Square (fitness facility with 20m long pool), 1 Grosvenor Square (fitness facility with 25m long pool), Clarges Mayfair (fitness facility with 25m long pool), Audley Square (fitness facility with 15m long pool) and 77 Mayfair (fitness facility with 12m long pool). In addition, there are 30 commercial gyms in Mayfair and St James, more than any other central London residential district,