Australia: Branded residences

In the intervening period, we have worked on many more branded residence developments (BRDs) all over the world including Australia. BRDs can be distinguished from hotel management agreement (HMA) arrangements in at least three ways:

  • It is an entirely different business to hotel management and comes with the potential of significant rewards for both owners and operators but also significant legal exposure for both parties.
  • BRDs are inherently more complicated than hotel management arrangements involving a range of parties including the operator, the hotel developer/owner, the branded residence developer (who may be the same entity as the hotel developer or one of its associated entities) and the purchasers/owners of the branded residences (BRs).
  • Negotiations are generally less adversarial than HMA negotiations with the majority of the negotiating time devoted to the legal and other advisers working collaboratively to ensure that the standard brand residence structure used by the operator throughout the world works within the strictures of property and other laws of the host jurisdiction.

We strongly advise that you read the prior newsletter (and the HICAP Master Class presentation to which it refers) as this newsletter updates and develops the information discussed in that newsletter.

Lastly, we also provide a link to the Branded Residence Report – 5th Edition published last year by Graham Associates. This publication is arguably the most comprehensive dissertation on the topic we have reviewed. We strongly recommend that you have a look at it as well.

As with all our newsletters, the views expressed herein are solely those of the author.

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