Specialty brokers cater to Gulf investors who have their eye on prestigious properties in the US and UK.
By Tahira Yaqoob
Horacio LeDon was showing a female client some apartments to rent when she ran into an old friend, who pointed to her new home.
“It’s one of the best buildings there is around here,” she boasted.
LeDon says without missing a beat, his client turned to him and said: “Find me the best.”
“She was not even planning to buy,” he says. The woman went on to spend $13 million on an apartment. It was an extreme case of keeping up with the Joneses – and somewhat more costly than the average impulse buy of a handbag – but LeDon takes the demands of his clients in stride.
As a broker for uber-wealthy clients investing in property in the United States, he is used to the whims of the rich and famous.
The Cuban-American leans forward conspiratorially in his leather armchair during an interview at the Capital Club in Dubai, and with a twinkle in his eye, tells how one of his Middle Eastern clients dropped $10m in what must rank as one of the world’s most expensive phone calls: “There was a 5,000 sq ft apartment for sale in Los Angeles.
“He called and asked if it was a good investment. I said yes and he bought it over the phone.”
While he is a great raconteur – his previous life as a Hollywood actor and scriptwriter gave him his storytelling skills – LeDon is utterly discreet when it comes to the identity of his clients.
But if discretion is key, so too is charisma and in the broker’s field, it goes a long way to making important contacts and sealing deals.
“My business is all referrals,” he says. “Everything is done by word of mouth.”
It is that networking which has brought him to the UAE, where there is a rapidly expanding market for investors with a
high net worth who are keen to buy in both America and Britain.
In his first year of business, LeDon has already closed multi-million dollar deals on apartments in New York and LA for three clients from the Middle East – one from Abu Dhabi, a Saudi national living in Dubai and one in Jeddah – and he is negotiating to sign up more.
“For them, it is less about yields and more about cache,” he says. “I only deal with the very high-end. If you have someone who is super-rich and wants to buy the best of the best, there are only a few of those places.”
It was while working for Related property firm, which is part-owned by Abu Dhabi Investment Authority, that he was approached by Middle Eastern clients asking for help in finding apartments for their children studying in New York.
After passing them on to his contacts, he realised there was a gap in the market and set up his eponymous business 14 months ago to generate interest from foreign climes in US apartments.
LeDon, who takes three per cent in commission from sellers, is on his way to completing $100m in sales, five times what he had envisaged for the first year of business.
And he says it is because the market for overseas buyers is flourishing while his clients, particularly those from the Middle East, are no-nonsense in getting what they want: “They are much more advanced, more mature and they do not negotiate.
“They understand if they get too clever, they might lose out. They come in full price, telling me to get it whatever it costs.”
They favour new apartments in exclusive locations with “understated opulence”. And with new developments meaning apartments can be as big as 10,000sq ft, sacrificing space is no longer an issue.
Getting a return on their investment is not a priority; it is more about the prestige of adding to their portfolio and the cache of having an exclusive address.
Meanwhile interest has been stirring in Dubai for an exclusive new – and rare – development in the saturated London market.
UK-based Berkeley Homes had its first roadshow to promote One Tower Bridge on the city’s South Bank, where apartments are priced between $8.6m and $23.6m.
While the developer is still waiting to close two deals, there has been a flurry of excitement about its Goodman’s Fields apartment block in the financial district of East London.
Six were sold, the bulk to Indian and Arab expatriates living in the UAE.
“London is still quite tax efficient for investors and the UAE has a good affiliation with the city,” says Piers Clanford, the managing director of Berkeley Homes.
There is an emotional attachment too as a third of buyers have “either been educated or spent time in London, or their sons and daughters study there.”
Will McKintosh from Olive Downtown, Berkeley’s agent in Dubai, says investors from the Middle East are typically entrepreneurs or executives in their 40s and 50s who prefer central prestigious areas such as Mayfair, Belgravia and Knightsbridge.
According to the international property consultancy Knight Frank, buyers from the UAE account for nearly two per cent of sales of properties worth more than $2.4m in the British capital.
The Emirates was ninth in a list of nations investing in London property, while Middle Eastern buyers accounted for more than eight per cent of new build purchases in the last year.
When apartments of up to $135m in Knightsbridge’s One Hyde Park went on sale, one in four buyers were said to be from the Arab world.
Chesterton Humberts was one of the first British estate agents to set up office in the UAE in 2009. Among the properties advertised on its Middle Eastern website are a $27m eight-bedroomed penthouse in Imperial Wharf and a $10.5m luxury apartment near Kensington Gardens.
The firm’s chief executive Robert Bartlett says: “Abu Dhabi is still incredibly wealthy and we saw a demand here for properties in London.”