Apparently these wealthy oligarchs just travel from city to city (presumably "creating wealth" as they go), and if some place gets too "hot," say a government wants them to pay taxes or citizens show up with torches and pitchforks, they just skip town to another wealthy enclave somewhere else. Isn't globalism grand?
The story of who bought these apartments and why reveals the complex dynamics of a tectonic economic shift that is creating a bumper crop of billionaires in the Third World as the austerity-strapped First World stagnates. This year, Forbes magazine’sannual list of billionaires included the first recorded in Angola, Nepal, Swaziland and Vietnam. Japan, once second in the number of billionaires, has been left behind by Russia and China. Europe long boasted the most billionaires after the U.S. but the Asia-Pacific region has taken off and may soon leave Europe in the dust. Today it is home to 386 10-figure fortunes (a decade ago, there were only 61). The world’s wealthiest person is a Mexican telecom mogul, Carlos Slim.The 1% Bug-Out Plan: Why Third-World Billionaires Are Buying Fortresses in London, New York and Miami (Alternet)
Vanity Fair reports that many of the apartments at One Hyde Park are owned by people who don’t want their identities revealed, people who hide behind the names of odd-sounding corporations registered in tax havens like the Cayman Islands. Others are Russian oligarchs, Chinese moguls and a Nigerian telecom tycoon. Rinat Akhmetov, the Ukraine’s 16 Billion Dollar Man, is a typical buyer. Attracted to London’s lax regulation and weak enforcement of things financial, these plutocrats are looking to protect their stratospheric fortunes and hedge against unpleasantries that might develop at home.
What appears to be a story of real estate is really a tale of offshore financing and a new class of global elites creating the ultimate gated community. As Britain and other First World countries sink into the mire of austerity, a tsunami of unfettered capitalism is spreading over the Third World and the BRIC countries (Brazil, Russia, India and China). Headlong capitalist growth tends to create instability and a growing trend of authoritarianism. Many of the new elites are living under semi-dictatorial regimes, and they need safe havens in the event of a collapsed government or a dictator who decides to give them the boot. They require real estate as insurance against economic catastrophe.
You might call them the Billionaire Doomsday Preppers.
Meanwhile, prices are rising beyond expectation. For single-family housing in the prime areas of London, British buyers spend an average of $2.25 million, Ms. Barnes said, while foreign buyers spend an average of $3.75 million, which increases to $7.5 million if they are from Russia or the Middle East...
The most visible, and also the most notorious, of the new developments is One Hyde Park, a $1.7 billion apartment building of stratospheric opulence on a prime corner in Knightsbridge, near Harvey Nichols, the park and the Mandarin Oriental Hotel, which functions as a 24-hour concierge service for residents. Apartments there have been purchased mostly by foreign buyers who hide their identities behind murky offshore companies registered to tax havens like the Isle of Man and the Cayman Islands.
It is rare to see anyone coming to or going from the complex, and British newspapers have been trying since it opened two years ago to discover who lives there. Vanity Fair reported recently that as far as it could discern after a long trawl through records, the owners seem to include a cast of characters who might have come from a poker game in a James Bond movie: a Russian property magnate, a Nigerian telecommunications tycoon, the richest man in Ukraine, a Kazakh copper billionaire, someone who may or may not be a Kazkh singer and the head of finance for the emirate of Sharjah.A Slice of London So Exclusive Even the Owners Are Visitors (New York Times)
The report found that strong demand from international buyers is fueling much of the growth in many of the world’s top destinations.International Buyers Play Key Role in Luxury Homes Market, Christie’s Report Says (Bay Area Real Estate)
High-net-worth individuals (HNWIs) ”find the world to be a small place, and geographical distances between cities are not relevant to purchasing patterns, which are more similar to each other in the 10 cities surveyed than other cities within the same country,” the report said.
“Globalization, economic development, wealth deposits, and technology attract HNWIs to the key global urban centers, where knowledge, capital, and culture intersect.”
In San Francisco, 40 percent of all $1-milion-plus home sales went to non-local and international buyers in 2012, the fourth-highest percentage among the 10 cities surveyed.
ADDENDUM: Russian tycoon Usmanov tops Sunday Times Rich List (BBC). Note that the richest native-born Briton (The Duke of Westminster) is in eighth place. Sir Richard Branson is 19th. And of course the number of billionaires and their net worth continues to increase.