Design in a Discerning Market

No. 5

As the economic outlook continues to draw attention regarding growth, interest rates, and a potential recession, we wanted to share our perspective on the economics of luxury design and its place in real estate development.

The Investor’s Mindset

High-net-worth clients rarely view real estate as a passion project. Best case, they are able to align their passion with their project. Even when they pursue investments that are experiential, cultural, or deeply centering, they seldom lose sight of the financial risk and the potential gain, often across generations. Mature investors do not waste money on garish embellishments or their pride. They are wise with their funds and focus on elevating their experience through location, accessibility, comfort, and space. This is where discernment matters. It is where design professionals offer the greatest value, especially as margins shrink and risk increases.

The Ecosystem of Design as Investment

Design exists in an ecosystem much like financial investments. A poorly considered design can look dazzling on day one, like a flashy startup, but fails to achieve its long-term goals. The best designs, like the best investments, are built for endurance. They take time to mature. In these spaces the patina is intentional, wear reveals character, and color stories amplify one another. These spaces welcome conversation, intimacy, and connection.

In today’s market, one can buy a trend out of the box or ask AI to generate design ideas distilled from the averages. We operate slightly ahead of those averages, slightly more daring and seeking surprise. Taste-making requires imagination and style, ensuring that design evolves alongside its inhabitants rather than collapsing under its own trendiness or dying out because it was copied today from what someone created last year. As the economic landscape becomes rocky its better to have a pathfinder than a trailblazer.

Beyond Aesthetics: Time as an Underrated Asset

Seasoned investors have considerable experience in real estate, and by extension, in design. They know that a sophisticated creative partner helps them curate decisions that fit the site, the architecture, and the long-term goals of the property. What many overlook is that time is an undervalued return provided by designers.

Luxury design services accelerate the project. By curating the best options within a given budget, we help resolve stakeholder disputes quickly. Sometimes this is amongst a Board of Directors or Investment Partners and sometimes it is between a husband and wife. By clarifying what is wanted, needed, and preferred we anchor the vision and with a little trust, move forward faster. For investors, saving months of time translates directly into earlier occupancy, revenue realization, or simply living the lifestyle they envisioned without delay.

Expertise & the Dunning-Kruger Effect

Seasoned investors know what they don’t know. This humility is one of their greatest strengths. In professional services, the Dunning-Kruger effect is real. That is, just because we eat at a fine restaurant, we believe we can be the chef; because we negotiated a contract, we assume we can practice law; because we picked out a chair and some wallpaper, we think we are an interior designer.

At Tower, we fight back against this creeping psychological effect. Our craft is not about decoration, it is about holding a high-resolution, three-dimensional vision in the mind. It is about anticipating how seasonal sunlight will play through a window, how a quiet night will move through a bedroom, or how a restaurant will feel when it is at capacity. This imagination is honed over decades, tested against shifting tides of color trends, technologies, and the pursuit of timelessness. This is our education. This is our craft.

The best investors recognize this as expertise, and they rely on it to transform assets into one-of-a-kind properties with greater return.

De-Risking Through Expertise

Investment-grade design mirrors financial investment strategies: it seeks high quality with low risk. This requires expertise at every level by sourcing refined commodities from reliable vendors, identifying the right craftspeople, and deploying a design team capable of discerning quality from mediocrity. Each step derisks investment.

Unlike speculative investing, we bring data. Having delivered projects from hotels and luxury residences alike, from Aspen and the BVI to palaces in the Middle East, we know exactly what things cost to design, procure, ship, and install. Our value is measurable, whether in an hourly rate, lump sum, or scope-based structure.

Our flexibility in pricing mirrors our flexibility in scope, allowing us to meet each client’s vision and investment objectives where they lie. Finding Partners with the expertise and willingness to flex their scope of services is important as financial precision becomes the only way to maximize profits when deal flow is low and interest rates are high.

The Case for Investment-Grade Design

For the discerning investor, design is not vanity, it is strategy. It safeguards capital, accelerates timelines, minimizes risk, and elevates both lifestyle and legacy. The best investments are those that compound in value over time, and the same is true of design. Done well, it not only enhances the experience of living but positions the asset as timeless, resilient, and irreplaceable.