_Top of the hood: Spotlight on three leading global super-prime markets

The Wealth Report, Knight Frank’s annual analysis of wealth and property investment, provides an overview of the performance of 100 prime residential markets.

In this article, we have taken the opportunity to drill into three markets in more detail to explore the geography of an even more rarefied sector of the market: super-prime houses or apartments that sell for over US$10m.

Our maps provide a view of both the density and the extent of these sales. Individual sales are grouped and their locations identified on the heat maps. It should be noted that some confidential sales are omitted from the analysis.

London, traditionally the world’s largest super-prime market with over 240 sales in 2015, saw a decline in sales volumes last year – partially as a result of currency movements (which affect our dollar-based calculations).

Total sales in London fell below 200 units allowing New York to claim the title of largest super-prime market in 2016 – a surge of new-build units in Manhattan helped to push the number of deals struck beyond 270. Hong Kong, with over 220 sales, shunted London into third place.

Hong Kong displays a relatively dispersed super-prime market, with clusters of sales on Hong Kong Island, into Kowloon and the New Territories.

London’s super-prime distribution reflects the development of prime residential neighbourhoods over the past 200 years. While Hyde Park and Regent’s Park play a dominant role in defining the super- prime market geography, the recent expansion of prime London with high value sales spreading along the river towards the City of London and areas further east is clearly illustrated.

This expansion of super-prime and prime sales into new neighbourhoods is a feature likely to be replicated by other markets as gentrification and regeneration take place in key global cities.

London

This is the original super-prime market. A bold claim maybe, but the influence of the great London estates through the eighteenth century, augmented by the genius of nineteenth century builder/speculators such as Thomas Cubitt, created an architecture and streetscape that more than anywhere else in the world has defined the language of urban wealth.

Take a walk from Hampstead through Regents Park into Mayfair, Belgravia, Kensington, Chelsea and on to Holland Park – it would take you a day to complete and you would never leave the city’s gilded enclaves.

^{Above: Five bedroom flat in Lancaster Parkside, London. For sale through Knight Frank}

New York

New York’s super-prime market – the largest in the world in 2016 – has seen a transformation over the past decade, with premium new developments in some of the city’s best downtown Manhattan neighbourhoods drawing an increased share of luxury transactions. Manhattan’s luxury market now revolves around this emerging downtown submarket, along with the traditional uptown neighbourhoods near Central Park – with little in between.

However, as recent high-end developments are pulling some higher value sales into Midtown, expect to see more blurring of the boundaries over the next few years as luxury buyers search across Manhattan.

^{Above: The Plaza Residences, 1 Central Park South, 1809 - Central Park South, New York. For sale through Knight Frank}

Hong Kong

Singapore, Shanghai and Beijing have seen rapid growth in their luxury markets, but with the highest density of ultra- high-net-worth individuals of any Asian city, Hong Kong, unsurprisingly, has the largest super-prime sales market in the region – by some margin. Unlike London there is an absence of a single cluster of sales, although Hong Kong Island provides the main hub for super-prime purchases.

^{Above: Skyline view of Hong Kong, from one of Knight Frank’s exclusive properties}