Wealthy individuals from the Middle East are a crucial market for the luxury industry, particularly real estate. Recently, an Arab billionaire showed off his wealth when he decided to rent the most expensive apartment in London. The London flat in question costs a staggering £55,000 (about $90,000) per week. The Arab billionaire has not been identified yet, but the imposing rental figure does not seem to be a problem; not even when you calculate that moving into the luxury apartment will set him back by $4.7 million per year.
The luxury property is located in Knightsbridge, London. It is a spacious four-bedroom penthouse apartment. But really, its real selling is the prime location. Knightsbridge is one of the most posh districts in the British capital, along with places like One Hyde Park and Lancelot Place. Harrods Estates, the firm that owns the London flat, did not divulge any information about the new tenant, apart from his being a Middle Eastern man. The company is the real estate section of the iconic Harrods department store in London.
Over recent months, Harrods Estates has been catering to a greater number of foreign clients. Mostly, the company has been entertaining clients from the Middle East, Russia and Asia. All of them have evinced an interest in luxury property in London. According to the firm, average property rentals rose to £4,285 in the period between March to the current date. During the same period last year, rental costs were far lower at £1,955.
Shirley Humphrey, the sales and marketing director at Harrods Estates, revealed in a statement that overseas clients account for 89 percent of the company’s sales, adding that Russia, the Middle East and Asia are the biggest markets. She also said that demand is not limited to property purchase but also to rental deals. It was in the course of this statement that Humphries divulged details about the Arab billionaire and his new London flat. She revealed that the £55,000 per week rental deal was a record for the luxury real estate firm.
Common perceptions are that London is a safe investment for high net worth individuals from the Middle East. Each year, these investors fly in to London to escape the oppressive summers of the Middle East. Not that Harrods Estates is the only company to benefit from the taste for luxury of affluent Arabs. In June this year, real estate consultants Savills had revealed that the biggest spenders on London’s luxury property market are wealthy buyers from the Middle East and North Africa (MENA). Savills said that MENA buyers held a 10 percent share of prime London real estate market and a 13 percent share of top-end London property.
Even the recently launched One Hyde Park reaped big benefits from this class of buyers when it sold property at the record-breaking rate of £6,000 per square foot in January 2011. Prominent Middle Eastern buyers of the One Hype Park apartments include Sheikh Hamad Bin Jasim Jaber Al-Thani of Qatar and the Sharjah government’s finance head, Mohammed Saud Sultan Al Qasimi. But they are by no means the only MENA buyers. Apparently, Middle Eastern buyers accounted 20 to 25 percent of sales of One Hyde Park’s 86 apartments by June 2011. The cheapest of these luxury apartments sold for £5.75 million (about $9.2 million).