“Lights out London” is the buzz phrase that, for many, sums up the problem with the capital’s prime property market and its absent owners. All those dark windows, mysterious ownership through off-shore companies and opulent leisure facilities that sit unused point to super-rich owners who are never at home.
A recent manifesto made of The Mayor of London Sadiq Khan is to open the city up to more businesses and foreign investors. Lately, more and more luxury properties have absent owners for a majority of the year. Why is this seen as negative phenomena?
Pricy property Management Company Rhodium, owned by the Moroccan Royal Family, looks after luxury and boutique hotel-like property. It takes care of over £1.5 billion of prime London properties, and has big plans to continue dealing properties worth £40 million up to £200 million. This type of foreign investment has made magnificent contribution to local economy, despite most property owners living abroad for most of the year.
Many luxury property owners and occupiers are international students. Owner of Rhodium, Dean Main explains that people in theirs 40s take 42% of super-prime property owners. for example Lincoln’s Square in Holborn, which is close to the LSE and King’s College London, is occupied by students at a hefty price tag of £30 million. Parents of the students believe London will be a great place for education so this is where they would rather spend the money.
The day-to-day tasks concierge complete at these pricey properties are a world apart from 10 years ago. Ex-managers of luxury hotels all over the world now gradually take these positions. The request of suggestion regards to fancy restaurants now changes into whereabouts of best nightclubs and private members clubs. According to Main, “Our clients just want problems fixed. They want exceptional, hotel-standard service in their home, all the time.”
As a result, the concierges in prime developments are getting used to dealing with a new breed of request. “Restaurant recommendations have traditionally been the main request, but now concierges tell me they are asked about the best nightclubs and private members’ clubs, or entry to the biggest football matches, fashion events or art exhibitions,” Main says. “These super-rich students don’t just want tickets. They want exclusive access or a preview before anyone else, and a chauffeur to take them there and back.”
It’s no secret that London’s super-prime market is struggling. Sales of new-build flats in London’s luxury market were down by 57 per cent by the end of 2016 compared with the previous year, according to property advisors London Central Portfolio (LCP). Stamp duty is mainly to blame, with many buyers rushing to get in before the rates changed in April 2016. Other “aggressive tax hits” on foreign ownership have also taken their toll, say LCP.
But Brexit has brought about an upside for dollar buyers – not just Americans, but those from dollar-denominated Asia too. “If you have a certain amount of money, you will have a home in London,” says Main. The super-prime market’s stagnancy is also piling the pressure on developers to find a winning formula that will seduce a reduced pot of potential buyers – which is where Rhodium comes in.
“We work with developers from the planning stage and stay on indefinitely once the residents have moved in,” says Main, who will advise developers on everything from service charges (two developments in London have now gone beyond an astronomical £20 per sq ft) to pool lengths and layouts (put the Jacuzzi beside the pool; residents don’t like having to walk into a separate room) and why they should have a reformer machine in their residents’ gym (Pilates is big at the moment).
Technology is another issue for the super-rich. “Clients tell us they want things simpler. They miss their remote controls.” And crucial to the success of a prime new development is finding the right concierge. “We look all over the world. It can take us a year and many are ex general managers of the world’s top hotels,” says Main.
Where, until recently, the concierge hid in a back room, now they are front of stage. They are “exceptionally well paid”, says Main, “and get big performance-based bonuses on top. There are always issues in the first year or two of a new development, and a concierge’s success depends on how well they deal with complaints. Our clients just want problems fixed. They want exceptional, hotel-standard service in their home, all the time.”