cross Mexico, real estate developers have encountered the same problem: their inventory does not have the absorption they projected, and a 20-30% drop in sales is common occurrence.
In an interview with the magazine Inmobiliare, Architect Carolina Granados, CEO of Archetika and consultant in real estate development, explains how house design, conception and construction must be transformed if we want to stop losing sales.
“As real estate developers we have been making the same mistake repeatedly: we do a project based on financial projections that are not aligned with the reality of the market. Due to health contingencies, our clients are now looking for spaces that are adaptable and can function as home, office and school at the same time. That same space must shield us from diseases, hurricanes, earthquakes, insecurity and pollution. The current problem no longer lies in the location where our client can live because, thanks to technology, they can work and study from anywhere. The main problem is whether or not your home can adapt to the life style challenges that you have to face. The moment we solve this, we will secure our sales."
The real estate development consultant tells us that she has recently observed an interesting phenomenon occurring in the popular Mexican Riviera Maya. A high percentage of buyers who acquired local properties as rental investment and who came to the area to work remotely during the pandemic, have now decided to move indefinitely after experiencing that the region offers a better quality of life.
“The supply of real estate properties has increased in Riviera Maya in recent years and some buyers are no longer looking for properties as investment, instead, they look for alternative or secondary residences. Buyers are not only searching for the most attractive locations from an investment point of view, but also those that offer the greatest wellness benefits: green areas, coworking spaces, health and fitness facilites, good healthcare, and above all more flexible interior spaces, where they can live, study, work and entertain themselves. Since the pandemic, buyers are inclined to acquire real estate where they can be confined for several months in case of another health scare”.
“The real estate developers who are most reactive at adapting to change and to new client demands and expectations will be the ones who will sell their inventory faster and can differentiate themselves from the competition. We cannot continue designing like we did ten years ago, indeed, we cannot continue designing like we did last year, it is time to redefine ourselves”.
Carolina Granados’s company Archetika has studied more than thirty Wellness projects around the world and has specialized in supporting developers to differentiate their products through focused branding strategies in market niches. Archetika also assist companies in restructuring their operations, and train staff in quality control and process optimization under the guidelines of the company’s Wellestate™ principles.
“Wellestate™ is more than a philosophy, it is the relationship that exists between a client who seeks to improve their quality of life (wellness) and a real estate project that guarantees capital gains (real estate). It is taking responsibility for building spaces that can adapt to our changing lifestyles, helping protect the environment while creating homes that are functional and adaptable. If after the health crisis that we are experiencing we have not yet understood that the real estate industry has to reinvent itself, we will continue to lose sales.
Developments have suffered a chronic ailment for a long time: you build a standard product that looks great in a spreadsheet but doesn't really take into consideration the customer needs and changes in the market. The result is that sales don’t follow projections. Some people end up blaming the architect, then the sales department, and finally they blame the client for being too picky. This must change”.
"Each transformation entails important management changes that at first will clash with our traditional way of doing things. But in the end, each change can make a difference."
Planning a real estate development according to Wellestate principles involves iterating through the following stages:
Define the target market niche that presents the best commercial opportunities, by thoroughly studying market data, and analyzing customer demographics and psychographics to fully understand the needs and wants that are in constant evolution.
Design a project based on functionality and on the features that the client requires to carry out their daily activities, and above all, take into account all the factors that impact on people’s physical, mental and emotional well-being.
Foster communities. Customers who seek a sense of belonging in their choice of residence tend to seek a local community to integrate, and developments must cater and plan for that important human dimension.
Make use of sustainable renewable technologies that make more efficient use of water and energy. Use green materials that are made to withstand the test of time. According to the Global Wellness Institute, clients are willing to pay up to 25% more for a property that offers wellness benefits and promotes a cleaner, most respectful natural environment.
Sell while keeping in mind that you will have to build a long-term relationship with your customers. The job doesn’t end on delivery of the product. Brand reputation’s currency is trust, and satisfied customers will become the best ambassadors for your brand.
Have an outstanding after-sales department that follows up on every situation that your customers experience. If a client perceives that you care about his well-being, he will speak well of you. If he feels ignored, you can expect severe consequences that will impact sales.
Improve every project you undertake by constantly learning from your customers' experience. It encourages communication between the after sales team and the designers.
Yes. We currently consult with several clients on how to apply Wellestate principles, and our clients have been able to differentiate themselves significantly from the competition.
As an example of a planned community in the Riviera Maya, we have KUHA Wellness Community who have been focused on designing a 34 hectares project in the jungle for developers who seek to build sustainable and innovative constructions.
Another developer who has understood that the post-sale experience is as important as the sale itself is Inzigna Capital, whose AWA project in Playa del Carmen has a unique after sales quality team and has implemented a strict process for quality control.
We have also worked with renowned architectural firms such as Grupo Arquitectónica del Arq. Genaro Nieto in Mexico City who design luxury residential projects based on the intangible needs of users, achieving more flexible spaces with greater profitability.
Finally, Carolina Granados clarifies: “Wellestate is the principle of being responsible for each project we build. As architects, builders and developers we make decisions every day that impact the lives of our clients. We have a duty to make the right decisions”.
Download the Wellestate™ Manifesto in PDF, in English or Spanish.
Read the Interview in Spanish.