The world’s wealthy have not lost their appetite for real estate investment prospects, according to two recent studies: one by Savills and Weatherill Consulting, and another by Sotheby’s International Realty and Wealth-X. It’s easy to see why real estate continues to appeal to the rich. Real estate rebounded faster than other asset classes in the wake of the financial crisis. It offers solid returns and appreciation prospects despite falling interest rates.
There are also non-financial reasons to invest in real estate. According to Wealth-X President David Friedman, “Because it touches upon several key elements in an ultra affluent individual’s life, including lifestyle, investments and family, luxury residential real estate encapsulates a core part of their identity. As their wealth continues to grow, so will their investment.”
When Savills and Weatherill consulting polled wealth managers and private bankers on the future investment plans of their clients, 53 percent of respondents said clients aimed to increase their direct real estate holdings, and 87 percent of wealth managers said their clients plan to maintain or increase indirect real estate allocations.
Yolande Barnes at Savills pointed out that “Private individuals have lost faith in financial instruments after the crash. They’re looking for alternatives to pieces of paper that leave them exposed to the vagaries of the financial system.”
Investors appear to be interested mainly in residential property in global gateway cities, but also secondary markets. For example, investment volumes in Spain and Ireland have increased 194 percent and 132 percent respectively as investors widen their focus beyond megacities like London and New York.
The world’s 211,275 ultra high net worth individuals collectively own real estate worth a total of 3 trillion USD – representing 10 percent of their estimated combined net worth of 30 trillion USD. These investors are increasingly seeing real estate as not merely a safe haven for their money or a trophy asset, but also as a reliable and considerable source of income. An estimated 5,975 of these individuals live in the Middle East, with a total net worth of 995 billion USD. The majority live in the Gulf Cooperation Council (GCC). And one of the GCC countries has the region’s highest concentration of multi-millionaires: Saudi Arabia, which has a multi-millionaire population of nearly 1,500 people representing a combined wealth of 320 billion USD.
Naseba is a multinational business facilitation company that has spent 14 years building an extensive network of investor contacts in the GCC, and leveraging this network for deal facilitation purposes. The network consists high net worth individuals, institutional investors and members of royalty from around the region, including Saudi Arabia.
Our investor introduction division carries out extensive in-house research with regional investors. Recently, this research has strongly indicated that they are actively divesting from the Middle East and seeking core assets in prime markets.
On April 27th 2016, Naseba will be organising a Real Estate Investors Meeting in Doha, Qatar, to introduce members of our investor network to pre-qualified real estate investment opportunities from around the world.
To submit your business case and register for the meeting, click here.
For more information contact:
Mark Davies
Project Lead
UAE: +971 4455 7954
USA: +1 773 840 6166
Email: markdnaseba.com
