Perspectives by Forbes Global Properties 2024

2023 INSIGHTS AND 2024 FORECASTS

2023 INSIGHTS AND 2024 FORECASTS

DIALOGUES WITH BUSINESS LEADERS

OUTSTANDING PROPERTIES THAT DEFINED 2023

Cover Image: Village Properties

James Cameron’s 100+ Acre Coastal Ranch

Gaviota, California

Emily Kellenberger | DRE: 01397913

Hilton

David Kramer | DRE: 00996960

Welcome to PERSPECTIVES, a comprehensive reflection of our real estate journey over the past year and a forward look into the trends that will shape what lies ahead.

The world of prime residential real estate continues to evolve, and we are excited to bring you the latest insights and outlooks as seen through the lens of our global network of almost 17,700 property experts operating out of more than 500 locations across the U.S., Asia, Australia, Canada, the Caribbean, Mexico, the Middle East, New Zealand and Europe.

Our members’ contributions provide a granular view of select regional markets, highlighting significant developments and forecasting upcoming trends. From economic shifts in Asia to emerging opportunities in the Caribbean, our coverage is not just summaries but deep dives into the intricacies of each market, informed by on-the-ground insights and expert analysis. Complementing our market outlooks are engaging conversations with experts in wealth, architecture, business innovation and hospitality. These topics are designed to highlight themes that directly influence the real estate sector:

• Global wealth portfolios are on an upswing following a post-pandemic fall, with the global luxury market seeing a $1.5 trillion-plus gain in 2023. This growth is prompting many affluent individuals to strategize their investments with a long-term vision, focusing on creating lasting legacies and securing financial stability for future generations.

• Heritage brands are increasingly entering the development space, blending their iconic elegance with real estate to create exclusive living experiences that redefine opulence. These moves tap into the desires of high-net-worth individuals who seek not just exclusivity, but also the cachet associated with such storied names.

• Today’s affluent travelers are looking for more than just high-end accommodations; they want real, immersive experiences that connect them with local culture. Responding to this shift, hospitality brands are creating personalized travel experiences that meet the individual needs and preferences of each traveler, redefining what luxury travel means.

• Leading companies are harnessing the power of language analytics to decipher personality traits and identify standout talent. By examining how candidates express themselves, businesses now aim to match individuals with the company’s culture and job requirements. Our report concludes with a selection of residential properties that set the benchmark in 2023, showcasing the creativity, innovation and excellence that defines our Forbes Global Properties members. Through the insights and outlooks of our global network, we paint a vivid picture of real estate’s current state and its future trajectory. For our readers, the parallels drawn between these member analyses and expert interviews offer a valuable guide for navigating and understanding the nuances of today’s prime property market and business world.

Michael Jalbert Chief Executive Officer

12023 INSIGHTS AND 2024 FORECASTS

Dive into the future of real estate with our members’ perspectives and projections for 2024, exploring the past, present and future of select markets.

Profusion Immobilier Spectacular Canal-Side Condo Montréal (Le Sud-Ouest), Quebec, Canada

Barry Cohen Homes 11 Ridgewood Road Toronto, Ontario, Canada

Profusion Immobilier 9, Av. Roxborough Westmount, Quebec, Canada

CANADA

OTTAWA, Canada

Bennett Property Shop Realty

By Mary Forgione

Ottawa is having a moment. The Canadian capital, known for its green spaces and laid-back pace, is experiencing an evolution from a government-centric town to a burgeoning tech hub.

The city has embraced a new identity as “Silicon Valley North,” says Marnie Bennett, CEO and founder of Bennett Property Shop Realty. “We’ve become a tech powerhouse. Ottawa has the second-highest concentration of scientists and engineers in all of North America.”

The influx of tech companies, startups and skilled professionals to Ottawa has fueled economic growth, resulting in increased wealth and a surge in luxury real estate transactions, including homes priced at more than a million dollars. The shift has also given rise to a new market, exemplified by the emergence of uber-luxury services, marking Ottawa’s progression toward a diversified and affluent urban landscape.

The impact: Sales of luxury homes that exceed CAD $1 million have jumped 398% in the last five years (1 CAD is about $0.75 USD).

“We didn’t really have a $1-million-plus [Canadian] market before,” Bennett says. “It was nonexistent.” There were 14 sales of more than CAD 3 million in 2023, and the median price of those was CAD 3.495 million. Of the 22 homes recently listed in that range, the median asking price was CAD 3.64 million. Then there are the showstoppers. The most expensive sale in 2023 was a two-story, 14,000-square-foot home with landscaped gardens in Rockcliffe Park, near the city center. It sold for CAD 6.3 million.

All this goes to show that Ottawa’s luxury market held up last year. Buyers—including tech workers, diplomats, lobbyists, Millennials looking to move from larger urban cores and even pro athletes—typically come from the United Kingdom, Spain and Germany as well as Dubai, the capital of the United Arab Emirates, Bennett says.

“We’re extremely optimistic about 2024, noting that sales in the last quarter of 2023 outpaced the same time period in 2022. Historically, we’re very resilient.”

Marnie Bennett Broker of Record/CEO Bennett Property Shop Realty

Bennett Property Shop Realty 263 Grandview Road Ottawa, Ontario, Canada

The influx of shoppers seeking premium properties has changed buying trends.

Years ago the demand was for new homes; now people are willing to buy houses that are 10 years old or more in sought-after neighborhoods.

Ottawa, a city of just 1.4 million residents, ranks high for quality of life. It’s among the safest cities in North America, Bennett says. The picturesque Rideau Canal runs through the city and is popular with buyers who want to purchase waterfront properties.

The canal and nearby Rideau Lakes attracted lots of buyer interest in 2021, leading to an average 88% jump in prices. “We thought that would subside, but we found that [waterfront properties] remained a dominant feature,” Bennett says.

Last year a law that barred non-Canadians from buying property went into effect throughout the country. The law, which was recently extended to 2027, was meant to make housing more affordable for Canadians. Bennett believes the law really hasn’t impacted the luxury market because of numerous

exemptions. The strength of luxury prices is further bolstered by the country’s largest-ever transfer of generational wealth.

By 2026, it is projected that the largest transfer of generational wealth, estimated to be $1 trillion dollars from Baby Boomers to Millennials, will result in the reshaping of the real estate landscape.

Bennett calls it the “Bank of Mom and Dad.”

With many Baby Boomers embracing the concept of “giving while living,” Millennials are becoming the recipients of substantial financial support. This trend is influencing a shift in home-buying patterns as younger individuals are now in a position to invest in multimilliondollar homes sooner in their lives.

Looking ahead, Bennett expects the city’s tech hub status to draw more wealthy Millennials to the area, transforming the consumer scene, while the generational wealth transfer will continue to boost spending, driving Ottawa’s future growth.

TORONTO, Canada

Barry Cohen Homes

By Natalie Hoberman

In cosmopolitan Toronto, inventory is tight, immigration is high and skyscrapers are everywhere–all factors that contributed to a stable high-end housing market in 2023.

The fall 2023 luxury property report from Cohen Homes & Estates revealed that sales of more than CAD 3 million (US $2.3 million) grew 7% from April to July, while sales of more than CAD 7.5 million (US $5.6 million) grew more than 4% from the same period the previous year. Luxury homes listed above the CAD 10-million mark increased 10% year over year, fueled by a flurry of sales at the last hour.

The recent closings during the traditionally quiet holiday period, however, are no accident.

The Toronto City Council approved an increase in the land transfer tax in September for luxury homes. Dubbed the “luxury home tax,” it starts at 3.5% for properties valued at CAD 3 million (US $2.3 million) and increases to 7.5% for homes ranging upward of CAD 20 million (US $14.8 million).

With the tax hike looming on the horizon, many buyers were quick to make last-minute deals before the increase became official on the first of this year.

Although the tax hike spurred sales last year, it could lead to a pause among buyers early in 2024. “The first half of the year will probably be slower for those luxury transactions out of buyer frustration to have to pay this tax, but eventually they will have to get used to it,” says Justin Cohen of Barry Cohen Homes. “It’s not going anywhere. They’re going to have to pay it at some point if they want to move.”

And, according to Cohen, there is no shortage of people who are looking to move. Many interested buyers have been sitting on the sidelines, waiting for their golden moment, as interest rates skyrocketed last year.

In early December, there was some cautious optimism when the Bank of Canada announced it would hold interest rates steady as inflation had dipped to 3.1% in October. Since March 2022, interest rates have risen 4.75 percentage

points, but many economists expect rates to come down before the summer.

“Once they start to cut rates, activity should increase causing prices to jump,” Cohen says. For high-end buyers, it’s likely that the excitement over interest rate cuts will trump concerns about the costlier property transfer tax, he adds

Toronto’s downtown core could see a surge in sales as buyers’ preferences return to prepandemic days.

“During Covid-19, people wanted more space and to be more remote. Now they’re coming back to more urban areas. They are looking to get closer to the core and major transportation areas that are more congested.”

Justin Cohen Vice President Barry Cohen Homes

In an effort to increase the Canadian workforce, the government has been increasing immigration targets over the last few years. It most recently announced plans to welcome 500,000 new permanent residents annually through 2026.

Many of those immigrants are expected to settle in Toronto, Canada’s largest city. That’s due to a variety of factors, Cohen says.

Some avoid Montreal, the second mostpopulous city, because they perceive that they must speak French in Quebec. Vancouver, with its seaside views and bountiful recreational activities, has a reputation as a popular tourist destination more suited to a vacation than a permanent residence.

That leaves Toronto, a multicultural behemoth with plenty of business opportunities. With pent-up demand, tight inventory and restrictive zoning laws, the influx of immigration is likely to put additional pressure on prices this year. 8

Barry Cohen Homes One-Of-A-Kind Palatial Estate On King Hills Lane King, Ontario, Canada

MAISON Bahamas

Ki’ama, Elizabeth Island Exuma Cays, The Bahamas

1503 Property Group

Serenity House Grand Cayman, Cayman Islands

Grace Bay Realty Sunny Bay Estates Providenciales, Turks and Caicos Islands

TURKS AND CAICOS ISLANDS, Caribbean

Grace Bay Realty

By Mary Forgione

For a small archipelago, the Turks and Caicos Islands deliver in a big way as a popular Caribbean beach destination among the wealthy for second or third homes. White powdery sand, electric blue waters and some 350 days of sunshine a year are the draw. The absence of income, property and capital gains taxes seal the deal.

The British Overseas Territory is attractive to buyers in the United States and Canada, the top two countries that feed the luxury home market. Other Caribbean residents account for the third spot, followed by European buyers. Of the territory’s 40 islands, eight are inhabited and becoming more developed. Providenciales is the most populated and most popular with tourists, particularly the Grace Bay area with a 13-mile stretch of beach and some of the priciest spreads in the territory.

The brightest spots in the 2023 residential housing market were in the luxury and singlefamily segments, where prices rose significantly and sales dipped only slightly.

The two top-selling homes in 2023, both in Grace Bay, included a 20,000-square-foot, 12-bedroom villa that sold for $33.5 million and a 12,737-square-foot six-bedroom villa that went for $19.5 million.

Overall, the islands saw a 113% leap in the volume (in dollars) of single-family home sales compared with 2022. The median sales price in 2023 rose to $3 million—far outpacing the median sale price of just over $1 million in 2022. The number of transactions was down 2.42%.

Condominiums and townhouses saw a deeper drop in the number of sales, largely due to a lack of inventory. The volume of condo sales (in dollars) was down 37% over the prior year, and the number of sales was down 39%. The median selling price dropped to $655,000 in 2023 from $724,500 in 2022.

The top-selling condo sales, also in Grace Bay Beach, were a four-bedroom residence at the Regent Grand priced at $6.38 million and a four-bedroom residence at Point Grace Resort for $6.25 million.

In shorter supply, townhouse transactions dropped to eight from 16 in 2023 with the median selling price jumping from $405,000 to $790,000.

Lyle Schmidek, co-owner and broker at Grace Bay Realty describes the islands as “low-key, English-speaking, safe, with little unemployment or fast food.” Miami is a 70-minute flight away.

Schmidek and co-owner, Beth Atkins-Charles, say a home in the islands is “Plan B” for those who want to escape political uncertainty in their homeland or want to leave urban areas in favor of a quieter outdoor lifestyle. (As for quiet, celebrities who own lavish homes in the islands enjoy the discrete anonymity and peace of mind that the island brings.)

Both are optimistic about the high-end home market in 2024, particularly the sales of villas. They say people now view their island home as a more permanent residence.

“The market has been quite prosperous, so owners are taking their profits and trading up or moving into other islands. That’s freeing up inventory.”

Lyle Schmidek Owner/Broker Grace Bay Realty

Those islands include North and Middle Caicos, South Caicos and Grand Turk, which are experiencing new development.

Atkins-Charles credits careful low-density developments with keeping Providenciales’ low-key vibe intact. The water between the world’s third-longest coral reef and the famous Grace Bay beach, for example, is a national park where motorized water vehicles are prohibited. Low-density building guidelines also mean that, on an average day, “you won’t find a crowded beach even though every resort is full,” she adds.

Also, waterfront development centered on Grace Bay keeps amenities within reach. Nothing is more than a half-hour away, the time it takes to drive from one end of Providenciales to the other.

Currently, the airport is undergoing upgrading and near future expansion, allowing for bigger jets from the U.S. West Coast and Canada, as well as other transatlantic locations. AtkinsCharles says its developed infrastructure will keep Turks and Caicos a top luxury home destination. “People can work from here,” she says, “and have real-time access to the world.” 12

Grace Bay Realty

Sunny Bay Estates

Providenciales, Turks and Caicos Islands

THE BAHAMAS, Caribbean

MAISON Bahamas

By Mary Forgione

Boating, beaches and kicking back in an alluring tropical setting (along with no inheritance, capital gains or income taxes) make life in The Bahamas appealing.

The island nation, an hour by plane from Florida, continued to attract the interest of high-end property-seekers in 2023, according to Ryan Knowles, founder and CEO of MAISON Bahamas.

Knowles notes a shift in the behavior and lifestyle of owners who have bought since the Covid pandemic. “The Bahamas has always been a place to have a vacation home, but it was less common for a primary residence,” he says. Now in the work-from-anywhere era, more entrepreneurs, remote workers and families are choosing to live in the country year-round.

“Why not work from a place where there’s great weather year-round, there’s great infrastructure for an island—great restaurants, great international schools— and if you need to go back to Toronto, or New York or L.A., it’s a quick, direct flight.”

Ryan Knowles Founder/CEO MAISON Bahamas

Knowles also sees younger buyers in the luxury market. He recently sold a $6-million home for a 25-year-old entrepreneur who made his money in cryptocurrency. The young owner sold because he plans to build a bigger home. The Bahamas has always been a popular choice for U.S. buyers. Most are from the Northeast,

MAISON Bahamas Ki’ama, Elizabeth Island Exuma Cays, The Bahamas

Texas and Florida. New direct flights from Los Angeles and Seattle to Nassau, the capital, mean a new pool of potential buyers, Knowles says. The Bahamas also attracts Canadians and Europeans, who have tax and residency advantages. About 80% of property transactions—domestic and foreign—are cash deals.

Exclusive gated neighborhoods on New Providence Island include Lyford Cay, a private club with a storied 18-hole golf course and two- to three-acre estates. It’s tucked away in the western part of the island, where newer communities like Old Fort Bay and Albany, known for its allure with A-list celebrities, have popped up in recent years.

Quieter islands such as Eleuthera, Great Abaco and the Exumas offer a more laid-back, private lifestyle where you can drive a golf cart and go barefoot all day. The Wall Street Journal recently reported on Harbour Island, which has become a magnet for billionaires because of its beauty, privacy and quaint town center. “That’s the dream, right?” Knowles says. “People pay a lot of money to live that dream.”

The first two years during the Covid pandemic saw the highest real estate sales volume in the history of the country, Knowles says. But last year luxury market sales dipped 15%,

particularly in the first quarter. “What we found was a lot of that new inventory just didn’t make it to the market,” he explains.

The decline can be attributed to homeowners deciding not to sell or delaying their plans. Knowles says he knew owners who love living in The Bahamas and didn’t want to sell their home for say, $10 million, when they’d have to spend $12 million for a new one. “As a result, we had a lot of buyers actively looking for properties on the market,” he says, “and we had very little to show them.”

High-end sales slowed slightly at the end of 2023, but January saw movement in the sector. Despite the dip in sales, prices remained firm and, in some neighborhoods, increased by as much as 20%. Prime waterfront lots, for example, saw a huge jump in values, Knowles says.

Potentially boosting the market are new developments that may come online as developers see the demand and opportunities to create more island residences.

“I’m positive about inventory returning to the market,” Knowles says. “I’m now seeing more and more new developments coming on the market, like the recently announced Four Seasons Residences on Paradise Island. I expect 2024 to be a banner year for The Bahamas.”

CDR San Miguel Real Estate Casa Oasis

San Miguel de Allende , Guanajuato, Mexico

LPR Luxury

One & Only Mandarina Nayarit

Lo de Marcos, Nayarit, Mexico

2Seas

SAN MIGUEL DE ALLENDE, Mexico

CDR San Miguel Real Estate

By Mary Forgione

San Miguel de Allende is a charmer, with exceptional Colonial and neo-Gothic architecture, cobblestone streets, colorful galleries, vibrant food scene and an affordable lifestyle.

The central Mexican town, which has fewer than 200,000 residents, regularly tops Condé Nast Traveler’s “Best Small City in the World” list. It’s an alluring place to visit or live, particularly among Americans.

The most sought-after neighborhood, Centro, is a downtown area that has been designated a UNESCO World Heritage Site for its cultural and historic importance. The pink Parroquia de San Miguel Arcángel church on the town square, El Jardin, is one of the most photographed landmarks in the city.

Buyer demand for upscale casitas and villas in San Miguel de Allende was as strong as ever in 2023, but finding enough prime properties to meet demand was a challenge.

Listings dipped after retirees and young investors swarmed the area during the Covid-

CDR San Miguel Real Estate Casa Oasis

San Miguel de Allende , Guanajuato, Mexico

fueled buying frenzy, shattering sales records. “2022 was by far the best as far as sales,” says Jim Dolan, longtime resident and broker with CDR San Miguel. “Sales in 2023 were somewhat off, but we were coming off a white-hot situation.”

San Miguel de Allende’s lack of premium houses for sale is due, in part, to the finite number of properties in Centro, Dolan says. There are few new developments because strict building rules protect the historic core.

The average sale price in Centro in 2023 was slightly above $1 million, with the high end of the market ranging from $5 million to $7 million.

Last year, 461 properties were sold in San Miguel. Forty-nine were in the $1-million-plus range, and 23 were $2 million and above.

U.S. mortgage rates and inflation don’t directly affect purchasers in San Miguel because it’s a cash-buyer’s market. In the last decade, 67% of San Miguel’s market was made up of foreign buyers, with Americans leading the group, followed by Canadians, Europeans and individuals from other nationalities, Dolan shares. In this segment, these purchases usually represent second or third homes.

For Americans, access to the U.S. is a selling point (airports are about an hour and a half away in Guanajuato and Querétaro). San Miguel is closer to home than, say, Portugal or Spain.

Also, upscale homes in Centro—often lavish with gardens, swimming pools and guest houses—cost far less than in high-end markets in many other places.

Dolan sees a burgeoning market in vineyard properties about 20 minutes outside of town. Lots cover 2.5 acres and offer a private lifestyle where wineries, polo fields and lavender fields abound. “It spreads the market opportunity around,” he says, noting vineyard properties are in the $2-million range.

Still, most foreign buyers want to live downtown, Dolan says, where they can experience the city’s easy vibe and walk to and from shops and restaurants. He thinks sales in 2024 will pick up but not at a breakneck pace.

“For 2024, we’ve got about five or 10 homes to bring on the market in the luxury segment going from $3 million to $12.5 million for a Colonial-era property off the downtown square that hasn’t sold since 1900.”

Jim Dolan Owner/Broker CDR San Miguel

LOS CABOS, Mexico

2Seas Los Cabos

By Mary Forgione

Los Cabos is where the Pacific Ocean and Sea of Cortez meet at the tip of Mexico’s Baja Peninsula. The region’s landscape shifts “from sprawling beachfront to towering mountainside to tranquil desert terrain in a matter of a few miles,” according to a recent Forbes story.

It’s an unbeatable location, with the rocky beauty of the Arch in Cabo San Lucas serving as a signature landmark that welcomes visitors. It encompasses the towns of Cabo San Lucas and San José del Cabo and the Tourist Corridor that links them.

Los Cabos has long been a vacation hot spot for beach lovers and scuba divers as well as a haven for wealthy homeowners who seek highend waterfront villas.

The market remained resilient in 2023; homes in the $2-million to $5-million category occupied the sweet spot with fourth-quarter sales of $73.5 million.

Sales of homes, condos and raw land were up 4.2% in 2023 year over year. Though home sales dipped 16%, the volume of sales totaled

$1.7 billion in 2023, up from $1.63 billion the year before. Ramiro Palenque Bullrich, owner of the luxury brokerage 2Seas Los Cabos, says land sales for development figured prominently last year.

The most popular properties for sale are villas in the $1-million-plus range, with large windows and outdoor terraces to take in views of the ocean and the mountains.

Many have pools and spas and are in gated communities with popular brand names such as Montage Residences Los Cabos, Ritz-Carlton Reserve Residences and the Four Seasons, which has two locations in Cabo. Spas, restaurants, lounges and bars, beach clubs and golf courses are some of the high-end amenities that come with resort ownership.

The most exclusive area is the Tourist Corridor, sometimes just called the Corridor. Bullrich has seen its transformation from coastal land into a high-end enclave.

“Ten years ago, you could drive from Cabo San Lucas to San José del Cabo and see the ocean almost the whole time,” he previously shared with Forbes. “Now, everything is built up. There’s a lot of development still happening and big players coming and what we see is a bright future for Los Cabos.”

The Corridor continues to be a sought-after location, more so than Cabo San Lucas, the tiny fishing village that turned into a vacation resort.

“[The] Pacific corridor to Todos Santos is growing fast. It is where you can find luxury properties surrounded by excellent golf courses, spectacular views and incredible sunsets.”

Ramiro Palenque Bullrich Broker/Owner 2Seas Los Cabos

In Los Cabos, home transactions are cash deals, with most buyers from California, Texas and Colorado. Canada is becoming a feeder market as well. Bullrich says many homeowners came to Los Cabos to live during the Covid pandemic. Now, they go back and forth. “They stay in their primary home for four or five months and live in Cabo the rest of the time,” he says.

What does 2024 hold? High demand and lack of houses, even in the luxury market, will remain issues. Elections in Mexico and the U.S. may affect interest rates and influence decisions by some interested buyers. Still, Bullrich expects luxury sales to hold steady this year. “They will stay stable, not grow that much,” he says.

2Seas Los Cabos Fundadores 48

San Jose del Cabo, Baja California Sur, Mexico

The

RETSY Award-Winning Design in Silver Sky Paradise Valley, Arizona

Turpin

ARIZONA, USA

RETSY

By Mary Forgione

Lavish homes on large lots, picturesque desert scenery and year-round warm weather continued to draw top-tier buyers to the Phoenix, Arizona area in 2023.

The price per square foot for homes selling for $2 million or more in Maricopa County (where Phoenix is located) jumped from $672 in March 2023 to $705 less than a year later.

“The market that one might anticipate would experience the greatest downturn due to the tightening of the real estate sector as a result of rising interest rates has, in fact, witnessed appreciation,” says Chris Morrison, founding partner of Scottsdale-based real estate firm RETSY.

Sales of seven-figure homes didn’t slow either, keeping pace with 2022, the Arizona Republic newspaper reported. In affluent Paradise Valley, a suburb of Phoenix, home sales were up 34% in the third quarter year over year, and home prices climbed 19% in the third quarter, compared with the second quarter.

A $23.5-million sale in Paradise Valley set a record for the town, besting the previous high of $21 million recorded in 2022. The 18,500-square-foot home, built for a car collector, underscores the relative value of the area’s ultra-luxury market. Set on 5 acres next to picturesque Mummy Mountain, it has two swimming pools, two libraries, a theater, a gym and a 900-bottle wine room.

Still, 2023 had its ups and downs. It started with sluggish sales in the second and third quarters, then recovered in Q4.

“I’ve had more high-net-worth individuals reach out in the last quarter of 2023 than I’ve ever seen in our industry.”

Chris Morrison Founding Partner RETSY

People shopping for a second or third high-end home in the Phoenix area primarily move from California, followed by Texas, Washington State and Colorado

And although sale prices didn’t dip, the number of luxury homes for sale did. Morrison recalls 2021 and early 2022 when sales increased during the Covid pandemic and “people on the sidelines jumped in and all bought at once, causing one of the greatest increases in home values in Arizona’s history.”

The ups and downs of selling have evened out since the Covid crush, but a lack of newly built homes may affect transactions into 2024. Some developers pulled out of projects when interest rates rose last year. Morrison worries that may result in a temporary shortage of new homes. This could particularly affect buyers looking for smaller homes in high-end

communities. “They want to downsize in house size, and maybe in land size,” Morrison says, “but not in lifestyle.”

Morrison believes 2024 will be strong, based on the increase in sales at the end of last year. As interest rates decline, he thinks inventory will increase. “All those people on the sidelines could flood the market,” he says.

RETSY Award-Winning Design in Silver Sky Paradise Valley, Arizona

SOUTH FLORIDA USA

The Keyes Company

By Mary Forgione

The past year witnessed an uptick in luxury real estate values within the Miami area, a trend primarily fueled by the steady stream of affluent and ultra-affluent individuals flocking to South Florida. This influx has consistently elevated the market for high-end properties, underscoring the area’s appeal as a haven for upscale living.

“Five years ago, there were less than 100 sales over $10 million,” says Mike Pappas, CEO of Florida real estate firm Keyes Co. “Last year, there were close to 600.”

He noted a lifestyle shift among high-end buyers. Now the wealthy aren’t just investing in South Florida, he says, they’re making their homes there.

“We’ve seen the really wealthy play here, but we’ve never seen them move here and put down roots and make an impact on the market until recently.”

Mike Pappas CEO Keyes Co.

One example: Citadel, the hedge fund run by billionaire Ken Griffin, moved its headquarters from Chicago to Miami in 2022. The Citadel migration shook the high-end luxury market and transformed the city, a playground for the wealthy, into a burgeoning financial center. “We used to be about hospitality,” Pappas says. “but now we’re building a new base and a new foundation of real business.”

Amazon founder Jeff Bezos, who went to high school in Miami, bought two properties—priced at $79 million and $68 million—on ultraluxurious Indian Creek Island. The transactions

were the third and fifth most-expensive purchases in South Florida in 2023.

A purchase by businessman Michael Cantanucci of New Country Motor Cars took the top spot. He paid $170 million for a 20,200-square-foot oceanfront home on 1.7 acres on Palm Beach island, making it the most expensive sale of the year.

Who else is buying in South Florida? Historically, buyers from the Northeast bought a second or third home in South Florida to escape the snow. Buyers also came from Central and South America, feeder markets that declined

during Covid but recently have begun to pick up. Pappas says he’s starting to see Californians in the area too.

“We saw an acceleration of decision-making,” Pappas says of buyers who jumped into the market during the early years of the pandemic.

As buyers continue to make their South Florida homes more permanent residences, the sun and fun hospitality hub has turned into a financial and business hub. “The dream of South Florida is coming true,” says Pappas, who has been selling homes in the area for decades.

“Those original pioneers would be smiling if they looked down to see what they started to create has now blossomed into an international city.”

Overall, greater Miami showed an 8.1% yearover-year rise in the median sales price ($1.67 million) of single-family homes in the fourth quarter of 2023. Sales increased 17.6% after overcoming a sharp 21% first-quarter drop.

Condos and townhomes showed a 16.9% dip in fourth-quarter sales, largely due to scant inventory, but posted a median price increase of 4.8% to $1.65 million. In upscale Palm Beach, condo sales were up 50%, with the median price rising 6.6% to $1.8 million.

The Keyes Company 2929 Marys Way Palm Beach Gardens, Florida

Mitchell Properties

Coastal Abode

Joie de Vivre

Santa Rosa Beach, Florida

Dale

COLORADO, USA

Slifer Smith & Frampton Real Estate

By Mary Forgione

It’s hard to avoid superlatives when describing Colorado’s mountain towns. Ultra-wealthy Aspen has been tagged as the most expensive ski town in the U.S., and Vail, Breckenridge, Steamboat and Telluride frequently crack top-10 lists of the most beautiful ski resorts in the country.

The exclusive lifestyle and singular beauty of the mountain resorts continued in 2023 to drive strong demand for high-end homes that couldn’t be completely met. As in other areas of the country, lack of inventory, even in the toniest communities, led to a drop in sales.

In Vail Valley, where Vail and Beaver Creek ski resorts are located, the number of luxury homes selling for $4 million or more dipped 12.7%. Sales volume in dollars was down 15.7% year over year, and the average selling price dropped to $7 million from $7.3 million in 2022.

But the numbers tell another story too. The luxury home market buoyed overall sales in the area to the tune of $924 million or 41.7% of the total sales volume in 2023.

“We’ve seen good momentum in luxury properties across the state,” says Matt Fitzgerald of Slifer Smith & Frampton Real Estate. The firm sells in Breckenridge, Aspen and Steamboat as well as in Denver and Boulder.

Jason Cole, CEO of Slifer Smith & Frampton, sees the bigger picture when looking at 2023. In 2019, Vail Valley sales in the $4-million-plus market brought in $467 million—an amount that almost doubled last year. “The peak was 2021, when sales volume was $1.2 billion,” Cole says. “We still saw positive trends in the luxury space in 2023.”

When it comes to wealthy and ultra-wealthy buyers, it’s not only location but also the quality of homes that drives demand.

“The resort markets we operate in are mature markets, very constrained in supply and in high demand, which means prices are somewhat insulated.”

Matt Fitzgerald Managing Branch Broker Slifer Smith & Frampton Real Estate

The Vail area had one of the highest median sales prices, $5.67 million, in the country in November, according to the firm’s Luxury Market Report for December 2023. The most expensive transaction in Vail Valley last year was a $20.5-million sale at the Villas at Beaver Creek in Avon.

It wasn’t the priciest in the state.

“There’s luxury and there’s Aspen luxury,” a recent Denver Post story put it. A $76-million off-market deal for a home in Aspen with ski-in access, indoor pool, bowling alley and seven bedrooms set a record for the town. The second most expensive home, also with ski-in, ski-out access, sold for $65 million.

Sales volume in dollars in Roaring Fork Valley, where Aspen is located, didn’t change significantly in 2023, holding steady at $3.79 billion, but the number of sales did. There were 123 fewer listings in 2022 to yield the same amount of dollars.

Buyers in Colorado’s luxury markets are mostly from the U.S., coming from Texas and Florida, followed by the New York tri-state area and the West Coast. Within the state, most buyers are from Denver.

Cole points to the rise in luxury markets outside of ski resorts among buyers who value access to urban areas. A $6.8-million transaction for a mansion in Denver’s Washington Park set a record for the area, and a penthouse at the city’s Coloradan high-rise condominium sold for $3.3 million. “We’re bullish on the return of downtown,” he says.

Boulder also set an area record with the $13-million sale of an estate. Telluride, despite inventory levels off by as much as 50% from before the pandemic, saw 2023 sales prices increase by double digits, according to a market analysis published by Telluride Real Estate Corp. As of the end of the third quarter, a dozen properties had closed in the $10.25 million to $18.9 million range.

What are the prospects for 2024? If interest rates ease, more homes are likely to hit the market. If the constrained supply continues, the high-end market may see a single-digit increase in sales in 2024.

Of course, demand will continue to drive the luxury market in a state that possesses beautiful and exclusive mountain towns and resorts. “What we have going for us is we live in an amazing place,” Cole says. “and demand isn’t going anywhere.”

Slifer Smith & Frampton Real Estate 107

Tahoe Mountain Realty

Tahoe Lookout Castle Glenbrook, Nevada

LOS ANGELES, CA USA

Hilton & Hyland

By Mary Forgione

Southern California’s ultra-luxury home sales always draw worldwide attention—and 2023 was no exception.

Music industry power couple Beyoncé Knowles and Jay-Z (whose real name is Shawn Carter) paid $200 million for a Malibu compound, making it the priciest home purchase in California history.

The purchase of the 30,000-square-foot concrete mansion designed by Japanese architect Tadao Ando beat the previous record of $177 million.

The second-priciest transaction last year went to another entertainment power couple, Jennifer Lopez and Ben Affleck. They spent $60.85 million on a 5-acre European-style compound in Beverly Crest. The pair paid cash, according to the L.A. Times, for a 38,000-square-foot home with 12 bedrooms, 24 bathrooms, 15 fireplaces, a movie theater and other lavish amenities.

Mega-transactions aside, the luxury real estate market last year was rocked by “mansion” taxes

that took effect in the cities of Los Angeles and Santa Monica.

L.A.’s new taxes—4% on real estate transactions of more than $5 million and 5.5% on sales of $10 million and more—took effect April 1. (Voters approved the taxes, which are meant to raise funds to ease homelessness and housing insecurity.) A month earlier, Santa Monica added a tier to the city’s tax tables that placed a 5.71% tax on property transactions of $8 million or more.

Sales took off right before the laws went into effect.

“Prior to those kicking in, you had sellers very willing to make a deal to avoid paying the tax, and you had buyers who were very willing to buy to get a good value,” says David Kramer, president of Beverly Hillsbased Hilton & Hyland. “So there was a tremendous amount of activity prior to the implementation of those taxes.”

Hilton & Hyland 3904 Valley Meadow Rd Encino, California David Kramer | DRE: 00996960

Kramer says he was closing deals on properties in both cities right up to a few days before the laws took hold. Then, after the sales frenzy, everything stopped.

“It was a dead zone,” Kramer says. The mansion taxes, along with rising interest rates and a scarcity of prestige homes for sale in Southern California, had a cooling effect on the market throughout the region, even among the wealthy.

It was the perception, more than the reality of mansion taxes, that made buyers and sellers skittish. “The sentiment kind of resonated throughout the entire area,” Kramer says, even in Beverly Hills and Malibu, which were unaffected by the new tax laws. Six months later, sales started to pick up.

Once the dust cleared, Southern California’s luxury market ended 2023 on a mixed note. Sales of single-family homes and condominiums in the $3-million to $4.9-million range jumped 24% in December, year over year.

In the same time period, sales of homes in the $5-million to $9.9-million category dipped 0.9%, and homes in the $10-millionplus category dropped 11.8%, according to the California Assn. of Realtors. Median luxury sales prices were up, except in the $10-million-plus category.

Southern California continues to be a soughtafter market for high-end homes.

“There doesn’t seem to be a shortage of people who want to spend a lot of money to live in Los Angeles.”

David Kramer President Hilton & Hyland

Kramer believes the rally that began at the end of 2023 will bring strong sales this year, especially with an anticipated drop in interest rates that may add more confidence to the market. And he’s philosophic about the winds of change in real estate.

“The one thing you can always say, and people don’t look at it this way, [homes are] still a place to live. We talk as if they’re a product—the ups and downs, what affected the market—but people still need to move. There’s always going to be transactions.”

NEW JERSEY USA

Turpin Realtors

By Mary Forgione

High-end home buyers in north central New Jersey are reawakening to the charms of life outside the metropolitan New York region.

“There’s a renewed appreciation for the area,” says John Turpin, president of family-owned Turpin Realtors, which services dozens of towns spread over five counties

By appreciation, he means city dwellers’ newfound interest in towns known for their beautiful landscapes and protected green spaces, quality schools and sophisticated dining and retail scenes. “We’ve got New York bedroom communities to the east, bucolic farmland to the west and suburbia in between,” Turpin says.

Overall home sales in the five counties dipped 21% last year from 2022, according to a 4th Quarter Market Report by Turpin Realtors.

The luxury market, however, proved to be more resilient. In December 2023, sales of homes in the $2-million-plus range increased 46.6% when compared to the same period in 2022. Homes in the $3-million-plus range increased 71.4% during the same timeframe.

Taking the longer view, the number of luxury sales in the region has doubled since 2019, in part due to a buying spree fueled by the Covid pandemic. Also, the median home price in the region increased 8.7% year-over-year and remains 31% higher than in 2019.

The move to the suburbs reverses the trend that took place in the mid-2000s. At that time, everyone from Millennials to Baby Boomers wanted to buy in urban centers like Brooklyn, New York, Hoboken and Jersey City (sometimes referred to as New York City’s sixth borough).

Then Covid hit, and the exodus from the cities began. “The pandemic caused people to reexamine their lives a little bit,” Turpin says.

The flood of buyers slowed in 2023 to a more normal level, but interest remained high. “You can be in the city in an hour, and Newark Airport in 45 minutes,” Turpin says. “And you can live out here on 5 or 10 acres in a beautiful house that you bought for $2 million or $3 million.”

Turpin Realtors

450 Claremont Rd

Bernardsville, New Jersey

Buyers in Turpin’s market often follow a predictable east-to-west pattern: First, they move from the city to a bedroom community like Chatham, and perhaps a few years later they move to a suburb with more space like Bernardsville, or even a rural area like Tewksbury.

“It’s not uncommon to see people move three or four times in the course of their lifetime, as family needs change.”

John Turpin President Turpin Realtors

During the pandemic, Turpin says buyers also came from less likely places like California and Colorado, sometimes driven by concerns about flooding or fires, or to be near family on the East Coast.

The luxury market in north central New Jersey is generally a resale market, with new builds replacing teardowns of older homes. One exception to this rule is Pendry Residences Natirar, the luxury resort-residential development by Montage Hotels and Resorts, which sets upscale homes and custom amenities atop a 500-acre park that includes a historic estate and working farm in Somerset County.

“This is a great example of innovation,” Turpin says. “It’s a phenomenal flag in the ground for our area.”

Bernardsville, one of the wealthiest towns in north-central New Jersey, features large older estates in picturesque settings. Last year, a seven-bedroom Tuscan-style villa listed and sold by Turpin was the most expensive sale in the area.

Like other areas of the country, inventory remained tight in 2023. Turpin believes that with declining interest rates and inflation, sellers on the sidelines may jump into the market this year.

What else might 2024 hold? “I’m optimistic,” Turpin says of the luxury market. “I am hopeful that pent-up inventory will come to market, meeting strong buyer demand not only in the luxury segment but across all markets.”

Special Properties

Enchanting Manor

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Elegran

522 West 29th Street, B-3 New York, New York

Long & Foster Real Estate

Unparalleled Luxury in Historic Georgetown Washington, District of Columbia

HAWAII, USA

Hawaii Life

By Mary Forgione

What a difference a year makes. Early in the pandemic, Hawaii’s high-end real estate market shattered almost every record with blow-out sales. The trend lasted, with sales of high-end homes in 2021 and 2022 outpacing nearly every year in the last decade.

But then came the predictable slowdown. How could the luxury market sustain such velocity?

The allure of buying high-end homes on the islands of Oahu, Hawaii, Maui and Kauai didn’t diminish, but the number of homes for sale did.

“We’re kind of overexposed,” says Matt Beall, chief executive of Hawaii Life. “Because so much of our trade volume during Covid was in the high-end market, we sold everything there was to sell.” The lack of supply—not enough luxury properties across the island chain to go around—led to a dip in 2023.

Across the state, the overall volume of home sales (in dollars) dropped 30%, and the number of transactions fell about 28% as of November, Beall says. Two bright spots: A penthouse condo in Honolulu’s Park Lane Ala Moana purchased by Hawaii Life clients for a recordsetting $27.5 million, and the $36.5-million sale of Dillingham Ranch on the North Shore of Oahu, in which the brokerage represented both the buyer and seller.

The number of available homes in Kauai stabilized with a slight increase in inventory, and the number of listings on Hawaii Island increased.

Oahu home sales showed signs of increasing after a slow start at the beginning of the year. The third quarter of 2023 saw the median sales price of single-family homes rising to $1.05 million and a rise in the price per square foot to $723.

The outlook for Maui remains in flux following the devastating August 2023 wildfires in the Lahaina area. “The impacts of fires will likely lead to continued volatility in Maui’s housing market in the near term—and potentially outsized demand and low supply for years to come,” according to Hawaii Life’s Q3 report.

Hawaii has always been one of the most desirable second-home locations in the country, with roughly a quarter of the state’s homes owned by nonresidents, as of 2021. Most buyers are from the U.S. mainland.

The state has seen a shift among pandemic-era investors that has affected inventory, Beall says. Many work-from-anywhere buyers have sought

Hawaii Life

72-118 Lei Kaunaoa Pl – Big Island Kailua-Kona, Hawaii

homes or condos across Hawaii, with strong interest in Waikiki on the south shore of Oahu, Kailua-Kona on the west coast of Hawaii Island and the resort communities of Wailea and Kapalua on Maui.

Before the pandemic, buyers tended to be more transient and considered their second or third homes as flexible assets they could resell.

During and after Covid, families who moved to the islands—mostly from urban areas in California, Texas and New York—enrolled their children in schools, fell in love with the outdoor lifestyle and became enmeshed in the community. “Hawaii has a way of sucking you in,” Beall says.

After the pandemic eased, many property owners didn’t sell their Hawaii homes when they returned to the office in their home states, he says. “We saw a massive uptick in property management, short term, long term or even just caring for the property.”

The geography and landscape of volcanic islands surrounded by the ocean limit the amount of land that can be developed, which

Beall says makes luxury projects “almost a zero-sum game.” Aside from some new luxury high-rise condos in Honolulu, the high-end real estate market depends on the resale of existing homes in picturesque parts of the islands.

Many buyers and investors in Hawaii’s luxury market live on the mainland, specifically the West Coast. Their “experience and expectations” of real estate are shaped by what’s happening in their markets—something once viewed as a precursor to changes in Hawaii’s market, Beall says.

“But over the years that’s been less true, in my opinion, largely because Hawaii is such a small market with totally different inputs and impacts than you’d see in a large metro market anywhere on the continent.”

Matt Beall CEO Hawaii Life

So what happens next? The beauty and lifestyle of the Aloha State is likely to keep demand high, and buyers hoping for more homes to come on the market and interest rates to ease must be patient. “We’re starting to see some inventory but it’s going to take time,” Beall says.

ASIA/OCEANIA

Private Property Global ‘Perpetua’ | Award-Winning, Snelling Designed Northbridge, Sydney, Australia

Driven Properties Signature Villas Frond F, Palm Jumeirah Dubai, United Arab Emirates

India Forbes Global Properties The Crown of Lutyens New Delhi, India

HONG KONG Asia

By Mary Forgione

Hong Kong has long topped the list of the world’s most expensive cities. The city comprised of islands and peninsulas has great natural beauty, exclusive neighborhoods, a massive concentration of wealth, stunning hilltop homes, gorgeous views of Victoria Harbor and an upscale, cosmopolitan vibe.

All those amenities, however, come with a hefty price tag. Mercer’s cost-of-living report said the Asian financial hub was the priciest city in the world in 2023, followed by Singapore and Zurich, Switzerland. The Economist Intelligence Unit’s index found Singapore and Zurich tied for first place, with Hong Kong at No. 5.

Real estate prices underscore how expensive Hong Kong can be. Last year, a newly styled luxury mansion at 45 Barker Road in the wealthy Peak neighborhood sold for HKD 1.2 billion, or US $153 million. The 4,700-squarefoot property overlooking the harbor set a record for the highest-square-foot price in Asia: HKD 255,000, or US $32,600.

The top floor of a high-rise in another soughtafter neighborhood, Southside on Repulse Bay,

sold in 2023 for HKD 120.8 million, or US $16.36 million. Cheuk Nang Lookout villa in the city’s sought-after Peak neighborhood is now listed at HKD 550 million, or about US $70.3 million. For a variety of reasons, including the Covid pandemic, rising interest rates and defaults by major China developers, the housing market slumped in 2022 and didn’t pick up much in 2023. “Buyers were very cautious, resulting in a very quiet market,” says Joshua Miller, CEO of real estate brokerage OKAY.com.

The number of transactions in the HKD 10-million-plus range (or US $1.25 million) dropped 15% in 2023 over the prior year, and 59% when compared with 2021, according to Hong Kong government figures. In the HKD 20-million category, or US $2.5-million range, transactions increased 13% in 2023 when compared with 2022 but were about 54% lower than in 2021.

“Many purchasers decided there were too many uncertainties,” Miller says. Buyers have been waiting on the sidelines for the last two years.

Primary home buyers in Hong Kong are “a combination of local [Hong Kong] residents, mainland Chinese investors and long-term expats who have been here for many years,” Miller says. “High prices and a small geography mean that people don’t buy holiday homes or second homes for self-use the way one might in the [United] States.”

Hong Kong is one of the most densely populated places on the planet and has tightly restricted new land supply to build new homes. Although wealth generated by the financial center has increased over the last decades, the number of homes has not kept pace with economic growth. With a limited supply of properties, Miller says, “prices have risen to astronomic levels in the last 50 years.”

Pressures affecting Hong Kong and its highend housing market began four years ago

when the area was sealed off in keeping with China’s zero-Covid strategy (Hong Kong is a special administrative region of the secondmost-populous country). Though there were exceptions and partial reopenings, Hong Kong didn’t fully open its borders until February 2023.

Then interest rates in the U.S. started to tick up, and the financial markets reacted poorly. Hong Kong’s currency is pegged to the U.S. dollar and is greatly affected by American markets and interest rates.

At about the same time, mainland China’s economy softened, a trend that continued in 2023. Defaults by real estate developers in China, for example, shook confidence in the real estate market, Miller says.

Hong Kong’s real estate market also experiences more volatility because buyers are more speculative and look at purchasing a home as similar to investing in the stock market. As prices have fallen, sellers must

decide how long they’ll wait to place homes on the market.

Having said that, “Hong Kong remains unique given its access to China, its role as a global financial center and yet having land supply that is highly limited. As such, demand will outpace supply for many years to come,” Miller notes.

After one of the biggest downswings in recent history, activity and prices may be bottoming. The hope for 2024 is for sellers and buyers to jump in.

“We’re confident that sales will go up modestly, 5-10% in the luxury market and maybe up to 20% overall as optimism begins to replace fear.”

Letizia G. Casalino Executive Director OKAY.com

The worst luxury home market in three decades will turn around when there’s a psychological shift that brings people back in, Miller says.

He sees hopeful signs. “In the first two weeks of January, the number of inquiries [to OKAY. com’s website] jumped 40% versus December,” he says. This could signify a positive turn for Hong Kong’s luxury housing market, suggesting a potential resurgence on the horizon.

Serenity Peak, Clearwater Bay People’s Republic of China

AUSTRALIA, Oceania

Private Property Global

By Natalie Hoberman

“In Australia, the people are laid back, the weather’s good, the lifestyle’s good, the sun shines, there’s blue skies and a lot of upside,” says director Ken Jacobs of Private Property Global.

That might explain why in 2023, many overseas buyers—including Chinese, American and European buyers—flocked to the country in search of a “safe haven” without political turmoil.

Australia has always been an attractive option for high-net-worth Chinese because of its relative proximity. Now that tensions have largely eased between China and Australia, Jacobs says 2024 could see an influx of Chinese buyers.

The Russia-Ukraine war, paired with fears of uncontrolled immigration, has led some to leave Europe, Jacobs says. Meanwhile, a polarizing political climate has contributed to Americans opting for more politically stable Australia.

But aside from geopolitical reasons, a simple fact remains: Australia is, and always will be, an attractive option for well-heeled buyers. Amid frequent interest rate hikes, record sales and tight supply, the Australian real estate market was anything but consistent in 2023.

The bottom of the market softened substantially as interest rates reached a 12-year high and rising inflation paralyzed buyers and sellers. But a shortage of quality stock at the upper end of the market drove record-breaking sales in the eight digits.

Yet perhaps the biggest takeaway from 2023 is that the market returned to being “normal,” Jacobs says.

Two years ago, when interest rates were at a record low 0.1% and the pandemic boom was in full swing, sales soared to unprecedented numbers. Now, everything has stabilized.

Private Property Global

‘Perpetua’ | Award-Winning, Snelling Designed Northbridge, Sydney, Australia

“We were never going to keep the same trajectory, the market had to plateau at some point. Now, we’re back to a normal market.”

Ken Jacobs Director Private Property Global

A market that includes jaw-dropping sales, of course.

Ranking in first place was the sale of a mansion in Sydney’s Point Piper, which closed in early 2023 for AUD 130 million (US $84.39 million), shattering the previous record for the country set in 2018 (AUD 100 million). The high-water transaction was followed by an AUD 76 million trade for an 1890s mansion in Sydney’s Bellevue Hill. Sydney’s highly desirable eastern suburbs saw two deals north of AUD 60 million (AUD 68 million and AUD 61.5 million).

Though the eastern suburbs have historically taken the prize for the country’s priciest listings, Melbourne’s Toorak suburb provided a close second last year with two sales in the top 10.

All in all, the 10 biggest sales in Australia amounted to AUD 533 million, or US $355.6 million.

The momentum is poised to continue in 2024.

Jacobs, who says he’s received numerous calls from sellers interested in listing their homes, anticipates this year will be strong because “there’s pent-up demand from buyers who are looking for trophy properties.”

New submarkets could also gain prominence this year. As land values and quality stock remain tight in the eastern suburbs, more buyers will be looking to buy in Sydney’s lower North Shore.

Jacobs, who has record offers for a home in Longueville, says to anticipate records being set in the north shore region. In recent years, the record for the highest sale on the lower north shore grew from AUD 25.5 million to AUD 42.2 million.

NEW ZEALAND, Oceania

PQ Property Intelligence

By Natalie Hoberman

Boasting snow-capped Alps, unspoiled beaches and a laid-back welcoming spirit, New Zealand is on a comeback tour.

After a tumultuous year characterized by a slump in sales, the luxury real estate market in the remote island nation is showing signs of revival.

Case in point: Manuka Point Station. Anthony Morsinkhof, managing director at PQ Property Intelligence, listed the secluded luxury lodge in January 2023 with an asking price of NZD 38 million (US $25 million). Months came and went with little to no activity, yet at the tail end of the year, five interested buyers materialized.

That’s one of a few examples he cites. He’s also working on an off-market deal for a NZD 50-million home (US $31 million), poised to set a record for the most expensive residential property when sold.

“I’m already seeing differences with offers coming in and properties going under contract right now, even in the holiday period. People seem to be in buying mode again.”

Anthony Morsinkhof Managing Director/Owner PQ Property Intelligence

The flurry of new real estate activity is a welcome change after a relatively lean 2023.

PQ Property Intelligence

Manuka Point Station

Methven, Canterbury, New Zealand

Sales volume dipped in April to its lowest level in 40 years, and property values nationwide fell 5% from last year. In Auckland, home to the priciest postal codes in the country, luxury home sales in the last quarter were down NZD 1.5 billion year over year.

The reasons for the dip are threefold: strict government policies, soaring interest rates and short supply.

The foreign buyer ban was put in place in 2018 by the Labour government. The polarizing law, which is still in effect, prohibits non-resident foreigners from purchasing existing homes in New Zealand, with the exception of Australian and Singapore nationals.

The conservative National Party, elected in October, made waves when it campaigned to reverse the foreign buyer ban, which could open the door to increased foreign investment. Although there are no formal policy changes so far, talk of the reversal did mobilize the market and elicit renewed optimism.

There is a loophole though, Morsinkhof says. Foreign investors can purchase residential properties if they have commercial use, such as a winery or a sprawling estate with hotel-luxury lodge capability that isn’t zoned as residential.

That has proved to be an attractive workaround for investors from Switzerland, Singapore, United Arab Emirates and the United States, Morsinkhof says. He expects this overseas interest to grow in 2024 amid a more business-friendly government.

Rising interest rates were another factor contributing to the decline in sales. In 2023 alone, interest rates rose from less than 3% to upward of 8%. Although rate hikes largely impact buyers at the lower end of the market, they did have an effect on the luxury market this year, Morsinkhof says.

A shortage of premium high-end properties also complicated matters. Still, there were plenty of notable sales in the country’s most coveted destinations.

In Queenstown, a affluent haven known for its luxury resorts and snow-capped mountains, a mansion is reported to have sold in June for more than NZD 40 million, nearly US $25 million. At that price, it would top the country’s decade-old sales record of NZD 38 million.

There was also a NZD 19.2-million property (US $11.9 million) and a NZD 16-million residence (US $9.9 million) that sold nearby, according to data from OneRoof.

On North Island, Auckland maintained its foothold with three sales above NZD 20 million, or US $12.5 million, and five sales in the NZD 10-million to 20-million range. Looking ahead, the market is ready for improvement.

A recent report from Knight Frank reveals Auckland stands to see a 10% increase in luxury home prices in 2024, surpassing major cities such as Dubai, Sydney and Miami.

“I’m positive for the new year,” Morsinkhof says. “There’s still hard work and people need to be realistic about prices they’re going to get, but there’s definitely a change happening.”

DUBAI, Asia

Driven Properties

By Mary Forgione

Dubai’s ultra-luxurious properties continue to dazzle buyers from around the world. What does US $16 million buy in the largest city in the United Arab Emirates? A contemporary villa in the ultra-luxury Palm Jumeirah neighborhood comes with ocean views, a large private pool and plenty of space for four or five friends to spend the night.

The custom interior with marble floors and soaring ceilings sits on a “frond” of the palm tree-shaped development on one of the world’s largest artificial islands. It’s the over-the-top luxury buyers here have come to expect.

“Dubai has attracted an impressive number of millionaires and billionaires, possibly more than any other place globally,” says Abdullah Alajaji, CEO and founder of Dubai-based Driven Properties. “As a result, this has reshaped the standards of luxury living. It’s not just about extravagant amenities or spacious areas; it’s about creating an unmatched lifestyle that goes beyond the ordinary.”

Park Lamar, for example, is a destination microcommunity under development in the Canal District. When completed, it will be convenient to the beach, downtown and Dubai’s airport.

Park Lamar is poised to redefine luxury, mirroring the sophisticated preferences and upscale living of both international and domestic buyers. “It is the perfect example of how the product looks if it’s designed for a modern affluent buyer,” Alajaji says.

In 2023, the ultra-wealthy continued to snap up multimillion-dollar properties in Dubai. Overall, high-end residential neighborhoods such as Palm Jumeirah, Emirates Hills and Jumeirah Bay Island accounted for 64% of US $10-million-plus home sales in the first quarter of 2023, according to a media report.

The number of Dubai properties sold in the $20-million-plus range increased by 28% last year compared with 2022. “The luxury market has surpassed all others,” Alajaji says, “showcasing the enduring strength initially observed in 2021.”

Indeed, Dubai has been on an epic upward trajectory for the last three years. In 2021, real estate transactions totaled AED 300 billion, or US $87 billion, the highest sales value in Dubai’s real estate history. The growth spurt represented a 66% jump in the number of sales.

Although post-Covid sales slowed in other luxury locations, Dubai’s market remained strong in 2022 and 2023 despite global events that have made foreign investment unpredictable, Alajaji says.

Apartments and townhouses with brand names such as Four Seasons, Bulgari and Cavalli have been popular with buyers since 2021, Bloomberg reports. It calls Dubai the “world capital of so-called branded residences.” Buyers mostly are residents of the Commonwealth of Independent States, a group

of nations led by Russia and Belarus, Alajaji says. There is also a stream of buyers from Western Europe, particularly Germany, France and the United Kingdom.

At the end of 2023, he says there was “a significant uptick in interest coming from Southeast Asia, including China and Japan.”

With the strong market comes demand for high-end homes, which has started to outpace what’s available. “This scarcity has … intensified competition among buyers,” he says.

The priciest home sale in Dubai in 2023 was a five-bedroom penthouse in the yet-to-bebuilt Como Residences on Palm Jumeirah. The custom property, set to be completed in 2027, sold for AED 500 million, or US $136 million. Driven Properties had several transactions that

sold for AED 100 million-plus, or US $27-million plus in 2023.

What’s coming in 2024? “Growing demand in the mid to high-end range” is a key trend, Alijaji says. The Knight Frank Wealth Report 2024 predicts a projected prime price growth of 5% for Dubai in 2024.

“We’re seeing a noticeable increase in the number of ultra-high-net-worth individuals, and it’s changing how things work in the real estate world.”

Abdullah Alajaji Founder/Managing Director Driven Properties

“It’s important to recognize that this surge could pose challenges, potentially making it difficult for some people to afford properties in the market, he continues.”

The Knight Frank report sees Dubai’s luxury market holding up. “After its stellar postpandemic performance the rate of price growth is slowing, but a scarcity of new prime supply and renewed demand from pivotal markets like China and India will see it remain in positive figures.”

Driven Properties Signature Villas Frond F, Palm Jumeirah Dubai, United Arab Emirates

Chestertons

The Haydon

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EUROPE

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LONDON, Europe

Chestertons

By Mary Forgione

Architect John Nash was tapped in 1827 to update King George IV’s London residence known as Buckingham House. He added two ornate wings to the building—going way over budget—and created a royal residence known the world over as Buckingham Palace.

About the same time, Nash built a stately villa in Regent’s Park, a leafy refuge north of London’s city center. The property last year sold for £113 million (about US $143 million), one of two transactions in London that ranked as the most expensive deals of 2023. Eclipsing that was the £138 million sale (about US $175 million) of a 25,000-square-foot mansion in the highly desirable Mayfair neighborhood. London always attracts international money when it comes to premium real estate. Ultrawealthy buyers turned out in 2023, shrugging off inflation, high interest rates and the British pound’s fall against the U.S. dollar.

Sales of homes priced at £15 million (US $18.9 million) and above increased 25% over 2022, according to Mansion Global. Fifty-four high-

end deals accounted for £1.3 billion (about US $1.65 billion) last year.

Ultra-wealthy transactions aside, other sectors of the luxury market struggled, particularly homes priced at more than £3.75 million (about US $4.7 million) and less than £12.5 million (about US $15.8 million), the Wall Street Journal reported.

“2023 was a tough year,” says Rowland King, director of prime sales at Chestertons, one of London’s largest and oldest real estate firms. “There was a real disconnect between buyers’ expectations and sellers’ expectations.”

The ultra-prime market—Knightsbridge, Mayfair and Belgravia, the most sought-after neighborhoods in central London—held up. The prime market, which includes central neighborhoods as well as luxury properties outside the urban core, saw an average discount of “just over 10%” to get sales moving, King says.

The estate agent has been selling homes in London’s toniest markets for more than two decades. He chalks up the doldrums to the

Chestertons The Haydon Greater London, England, United Kingdom

nature of the transactions, which are very discretionary.

“Most buyers don’t need to buy a second, third or 10th home. Sellers don’t need to sell because they’re cash rich.”

Rowland King Director of Prime Sales Chestertons

Britain’s real estate market has been shaken by a number of events in the last decade: a 2014 luxury tax imposed on high-end transactions, the exit from the European Union and the global Covid pandemic in 2020 and 2021. But nothing affected the market more than the British pound dropping in value against the dollar, falling 3.75% in September.

“The dollar-motivated buyer is incredibly influential in our market,” King says.

Consumer Price Index (CPI) inflation data released in mid-November has led to a shift in economic predictions. “Given the sharp shift in sentiment since the October CPI inflation figures were announced in mid-November and the subsequent fall in mortgage and swap rates, many, if not most, commentators are cautiously calling the bottom of the market,” he says. “Certainly there seems to be a lot to be positive about when looking at the data.”

“2024 really started for us in the last five weeks of 2023,” he adds, noting he saw £35 million (about US $44 million) in sales in that time period.

London’s prime property market plays in a global arena, with high-end investors in the last few years coming from India, Turkey, Qatar, the U.S. and Saudi Arabia. Covid increased demand for homes with more space and gardens to accommodate families.

Buyers seeking a lifestyle change after the pandemic now look for properties with resortlike amenities and enhanced security. Also, “our summers are getting hotter and so the demand for properties with air conditioning has increased exponentially,” King says.

Looking forward, King sees an important trend in the increase in high-value receiverships, or foreclosures, with a caveat. “It is important to note that these are largely a result of … bankruptcy, criminal investigations and sanctions” and not the heightened interest rate environment, he says.

Chestertons predicts 1.8% growth in home prices in prime central and greater London, largely driven by cash buyers. Factors such as stalled economic growth and an upcoming general election may lead to uncertainty.

Any optimism must be tempered with the knowledge that “the market will inevitably pause until we are certain what stance Labour is likely to take” regarding property and taxes, King says. He sees the British pound as a key factor.

“Depending on the performance of sterling, which rallied in 2023, we are likely to see a continued resilience in the prime/super-prime markets,” King says. “London is London, and it just seems to be resilient.”

SWITZERLAND, Europe

FGP Swiss & Alps

By Mary Forgione

Switzerland is home to some of the most expensive cities on the planet. In 2023, Zurich, its largest city, tied with Singapore for the No. 1 spot as the world’s priciest city. Geneva, its second largest, tied with New York City at No. 3, according to a recent Forbes story.

The country experienced an overall real estate market decline in the volume of transactions in 2023. The 38% dip was down from 2021, a record year, and a 25% decrease when compared with the average number of sales over the last decade.

“In 2023 we have seen a paradoxical dynamic where the market has clearly slowed down due to the increase in interest rates, but prices kept increasing due to a strong demand and limited [inventory], yet at a slower pace than in previous years,” says Quentin Epiney, founder of the real estate firm FGP Swiss & Alps.

The ultra-luxury-home category, however, remained strong in Switzerland last year, Epiney says.

Lower-priced markets slowed because of buyers’ dependence on mortgages (even though interest

rates were 2.1%), but that wasn’t true for highnet-worth buyers. The ultra-wealthy continued to flock to the country as a hedge against political and/or economic instability in the world.

“The country is perceived as a safe haven due to the security, stability—both political and financial—and quality of life it has to offer, even if the cost of life is high and there are limitations to property acquisition by foreigners.”

Quentin Epiney Founder FGP Swiss & Alps

Switzerland’s high-end home market includes Geneva and Zurich, banking and diplomatic centers where high-standard apartments start at CHF 2.64 million (US $3 million) and houses at CHF 5.28 million (US $6 million). In

the tourist hot spot of Lake Lucerne, the same standard of property starts at CHF 1.76 million (US $2 million) for an apartment and CHF 3.52 million (US $4 million) for a villa.

More luxury properties can be found in the storybook ski resorts in the Swiss Alps. Upscale Gstaad, Verbier, St. Moritz, CransMontana and Grimentz continue to attract international buyers.

“Prime property can range from US $13,400 (CHF 11,450) per square meter in an upcoming yet attractive resort such as Grimentz, all the way up to US $41,000 (CHF 36,100) per square meter in Gstaad,” Epiney says. Gstaad, with the most expensive resort properties, is the Aspen of Switzerland. A record-setting recent sale went for US $80,000 (CHF 70,400) per square meter.

The most expensive sale in 2023 was an underthe-radar purchase of a property in the Geneva area for CHF 106 million (US $120.36 million). Trailing the nine-figure transaction was an 18th-

century castle and accompanying forest that sold for CHF 64.46 million (US $73.2 million) in Céligny, near Geneva. “The details of the interior, number of rooms and so on has remained confidential, yet it was recorded as one of the highest transactions historically for a residential property,” Epiney says of the castle property.

The surge of Covid buying in 2021 and 2022 has ended in Switzerland, but the pandemic changed buyer expectations. There’s more desire for outdoor spaces as well as suburban or countryside properties with a garden, a change since pre-Covid days, he says.

What will the rest of 2024 bring? “We expect to see a continued yet moderate increase in prices, supported by a strong Swiss economy, limited inflation and probable increases in the cost of construction materials,” Epiney says. Risks that may affect luxury home sales include expanding conflicts around the world and the prospect of a new financial crisis linked to the record volume of vacant office spaces worldwide that are financed by major banks.

Beyond those factors, Epiney says the European and Swiss economies remain strong in the face of turbulence. Stabilized interest rates will help the overall market in 2024, indicating a potential increase in sales over 2023.

FGP Swiss & Alps Exceptional Opportunity In The Heart Of Grimentz Grimentz, District de Sierre, Switzerland

PORTUGAL, EUROPE

Portugal Forbes Global Properties

By Natalie Hoberman

Portugal is becoming a hotspot for high-networth individuals interested in owning real estate in Europe and lured by the country’s warm climate and charming towns. It also ranks as the seventh safest country in the world, according to the 2023 Global Peace Index.

The challenge? It’s a small country—about as big as the state of Indiana—with a tight supply of housing.

At the start of 2023, the headlines in Portugal expressed a sense of caution. Discussions throughout the country focused on rising interest rates, a dip in foreign investment and the possibility of a slowdown in development— variables that created a heightened sense of awareness in the market.

But fast forward some 12 months and reality paints a prettier picture.

Investment in luxury developments remains strong. Wealthy buyers from overseas are continuing to purchase. Sale prices are growing steadily despite a handful of interest rate hikes.

“Portugal has become an international destination and that’s something we’re still reaping the rewards from,” says managing partner Pedro Teixeira Santos of Portugal Forbes Global Properties. “There’s a lot of investment coming in and a growing interest.”

As supply inches upward, prices will continue to rise in 2024.

“We’re reaching record prices. That’s not just because prices are increasing or because demand is increasing, but because the quality of the products being built today is far superior than it was maybe five to ten years ago.”

Pedro Teixeira Santos Managing Partner Portugal Forbes Global Properties

The Algarve, Portugal’s southernmost region with 300 days of sunshine and long, sandy beaches, has seen remarkable growth. In a 12-month period ending in October 2023, values have jumped as much as 15% and are expected to grow another 19% by 2025.

Quinta do Lago, an exclusive resort in the Algarve known for its opulent residences, award-winning golf courses and access to trophy facilities, is a favorite among foreign buyers. “The pandemic solidified the positioning of the resort, with clients valuing the lifestyle,” Santos says.

Looking ahead, expect more luxury developments with high-end housing and hotels throughout Portugal. Santos says his brokerage is starting to see an increase in upscale developments backed by international funds, with particular interest in the Comporta/Melides area, Cascais and the Golden Triangle in the Algarve.

Many overseas buyers are from Brazil, which shares the same language, as well as from the United States. As 2024 unfolds, Portugal is likely to see an increase in investment from wealthy buyers in both countries.

“The Algarve has not yet been discovered by U.S. buyers,” Santos says. With a direct flight from Newark, New Jersey to Faro (Algarve’s capital) starting in May and “a very attractive product that is well-fitted for Americans,” that could soon change.

Interest from Brazilians and Americans is increasing, similar to the historical enthusiasm Europeans have shown for the country. In years past, Europeans flocked to Portugal in search of

attractive taxes, a better price per square foot and a premium quality of life.

Changes to the Golden Visa program have introduced new challenges for those aiming to secure residency while having minimal impact on the purchase of vacation properties. In an effort to rein in housing prices, the Portuguese government in October ended investments in real estate and certain capital transfers that non-European Union citizens had used to gain residency and tax benefits.

For those ultra-high-net-worth individuals who want to buy their vacation home in Portugal and are not looking for residency, the impact should be negligible, Santos says.

Still, there are some loopholes and other avenues that can provide a similar benefit. These include investing a minimum of €500,000 (US $543,000) in a venture capital fund or creating at least 10 jobs.

“If you want to invest 10 million in Portugal, you’re fine,” he says. “If you want to invest a million, then it’s not as attractive as it was before. There are ways to invest, but you have to be organized.”

Portugal Forbes Global Properties

Villatura in Quinta do Lago Almancil, Algarve, Portugal

Best Invest - The Republic of Cyprus Golf Oasis by the Mediterranean Limassol, Republic of Cyprus

Best Invest - North Cyprus Penthouse Living in Iskele Famagusta, North Cyprus

Broker Group

Seaside Elegance on the Dalmatian Coast Zadar, Croatia

Groupe Mercure Château in Fontenay-lès-Briis Essonne, France

TURKEY, Europe

Best Invest

By Natalie Hoberman

For some, a trip to Turkey means exploring the rich bazaars in Istanbul, floating in a hot air balloon above Cappadocia and touring beautiful mosques. For others, it alters their life course, transforming them from tourists to permanent residents.

“We tend to get a lot of sales through people who just come on holiday and fall in love with the place,” says Stephen Garvey, partner for Alanyabased Best Invest. “You have glorious sunshine, excellent beaches all along the coastlines and all of the history of the world here.”

After a fairly stagnant 2023, the luxury real estate market in Turkey is on track for a better year. With 70 million tourists expected in Turkey in 2024 and a slowing inflation rate, the market may start to see some relief by June. Coastal regions are poised to see the greatest real estate momentum.

Bodrum, a historic harbor city with turquoise water, designer shopping and luxury villas, has become a hotspot for the rich and famous. In the last decade, the value of real estate transactions in the glitzy city rose from $892

Best Invest

5-Bedroom Villa Bodrum, Muğla, Turkey

million in 2010 to more than $2.1 billion in 2020.

The Mediterranean coastline resorts of Antalya, from Kas to Alanya, also have seen unprecedented growth, with more than 10,730 properties sold to foreign buyers in 2023.

Istanbul, “the gateway between the East and the West,” remains competitive. Prices in Turkey’s largest city—both for land and the cost of living—are among the highest in the country.

Most foreign buyers in Turkey come from the Middle East and Eastern Europe. Following closely are buyers from Germany, the United Kingdom, Poland and the United States

Besides the coastal allure, Turkey appeals to foreign buyers because of its exceptional luxury housing.

Culturally, Turkish homes primarily served as places where multiple generations would gather to eat and sleep, Garvey explains. There has been a noticeable shift, however, with more appreciation for contemporary design. This includes incorporating abundant sunlight, accessibil ity features and expansive open floor plans.

“Twenty years ago, a single villa with a beautiful view would have little narrow windows or smaller-scale windows. Now you’re looking at big glass frontages that absorb the whole environment and roller doors that open up the whole space to the outside.”

Stephen Garvey Partner Best Invest

Legislation and regulatory changes have also come into force. In 2023, the required minimum real estate investment for a Turkish residence

permit was increased from US $75,000 to US $200,000, and regions that exceeded the foreigner’s quota are not permitted. The tightening of restrictions, coupled with radical changes in monetary policy, contributed to a slowdown in the market in 2023.

In December 2023, inflation jumped to 64.8%, its highest level since 2022. The soaring inflation came after the Turkish government drastically cut interest rates following destructive earthquakes.

“The devastating impact of the earthquake in February 2023 cannot be forgotten. Our hearts and prayers are with those who suffered loss of life and livelihood. However, the Turkish are a resilient nation,” Garvey says.

The outlook is improving, however. The Turkish Central Bank forecasts inflation will drop to 36% by the end of 2024. And with tourism expected to reach record highs in summer, it could bring a wave of affluent buyers.

“There is an awful lot to offer,” Garvey says. “I’ve never had a difficult day in Turkey.”

SWEDEN, Europe

Shaza Luxury Real Estate

By Natalie Hoberman

In Sweden, progressive thinking and sustainability are a way of life, and in Stockholm, the high-end real estate market is a prime example. Beqo Hoti of Shaza Real Estate says he anticipates sustainability will be key to motivating home buyers in the capital city. Real estate developments that leverage technology and innovation to improve quality of life will perform well this year, he predicts.

“Innovation and urban planning is going to be a huge force for luxury property. It will attract both residents and investors.”

Beqo Hoti CEO/Founder

Shaza Luxury Real Estate

Developments in places such as Gothenburg, on Sweden’s southwest coast, are proving to be the most resilient, attracting large institutional funds, private equity and venture capital money

in an otherwise turbulent market, Hoti says. His firm, Shaza Real Estate, is involved with several new developments across Sweden as well as with several luxury projects overseas.

With inflation reaching as high as 12%, rising interest rates and soaring consumer debt, 2023 was a relatively lackluster year for luxury real estate in Sweden. The cooldown comes after nearly two decades of uninterrupted growth in prices.

Transaction volume was down SEK 90 billion (US $8.6 billion) in 2023, Hoti says, nearly 60% lower than in the previous year. Foreign investment, meanwhile, dropped from 29%

Shaza Luxury Real Estate Archipelago Idyll Vaxholm, Sweden

to 21% in the same period, he adds. The Russian-Ukraine war also heightened tensions, contributing to uncertainty among buyers.

Still, with any downturn comes opportunity.

“You can get places in Sweden that are beautiful and have a great location for a very good price, compared to if you would buy something in Miami or Dubai,” Hoti says. “The value of location and property you get is a great opportunity for investors.”

Case in point: a waterfront villa in Stockholm with its own jetty, wine cellar and jaw-dropping

views is on the market for SEK 32.8 million or US $3.1 million. A comparable home in Miami could sell for twice that.

Stockholm and other Swedish cities could see an influx of new buyers after the country became a member of NATO in March. Formal acceptance by the alliance could lead to an increase in demand for quality housing and potentially boost foreign investment in Sweden, Hoti says.

In neighboring Finland, its recent entry into NATO led to an increase in foreign investment as perceived risk in the country dropped. It’s possible a similar scenario could play out in Sweden.

Optimism is on the rise as 2024 unfolds. In December 2023 the number of homes sold in Sweden increased by 8%, compared with the previous three months. And in some upscale neighborhoods, such as the coveted Östermalm in the Stockholm city center, listings near US $12 million are emerging.

Although it’s likely that major improvements in the luxury real estate market won’t occur until the later half of the year, Hoti says he anticipates seeing “more housing deals and prices start to turn upward again.”

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Rarex

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Rimontgó Císcar 4 Valencia, Spain

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Lakeside Villa on Lake Como Faggeto Lario, Lombardy, Italy

St. Regis Residences

Sunny Isles, Florida

Photo credit: Arquitectonica

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INDUSTRY INTERVIEWS: DIALOGUES WITH BUSINESS LEADERS

Uncover insights from exclusive interviews with industry leaders on wealth, design, business strategy and luxury travel

TRENDS IN GLOBAL WEALTH AND LUXURY

By R. Daniel Foster

Global wealth is on the upswing following a post-pandemic fall, billionaires have bounced back from 2022’s net loss of $1.4 trillion, and the global luxury market was projected to hit $1.6 trillion in 2023, a new high.

The second Gilded Age shows no sign of retreat. In the U.S., the bull market prevailed with the S&P 500 rising nearly 25% —despite political

brinkmanship over the debt ceiling and a banking crisis that felled five banks. Globally, the wars in Ukraine and the Middle East added to the turmoil.

As the effect of higher interest rates continues to percolate through the economy, with inflation falling and unemployment at 3.7%, many forecasters see a bullish 2024—if the

nation’s and indeed the world’s economic clockwork continues to move in the right direction. Although the global economy has proved to be stable, and perhaps even sturdy, the World Bank has projected slower output growth in coming months.

The Billionaire Wrap-up

The number of the world’s billionaires rose by 7% in the 12 months leading to April 2023. They now total 2,544, which is smaller than the group’s peak of 2,686 in 2021, when their worth totaled $13.4 trillion. The net loss of $1.4 trillion the group experienced in 2022 was erased by a $1.5-trillion gain in 2023, according to Bloomberg.

Today the world’s richest have an aggregate worth of $12 trillion, according to the World’s Billionaires List published by Forbes. The group’s recovery is due to the fortunes of European billionaires in the consumer and retail sectors, according to the Billionaire Ambitions Report 2023, compiled by UBS, which provides financial advice and solutions to private, institutional and corporate clients worldwide.

The world’s largest concentration of wealth is in the Americas, but France has the largest share of billionaire wealth in Europe, the Middle East and Africa. “But the number of billionaires increased more in other Western European countries,” which includes Germany, the United Kingdom, Italy and Switzerland, according to UBS’ Billionaire report.

The rising fortunes of the wealthy class tracked tech stock performance, which experienced record ascents in 2023. The zeal about artificial intelligence helped boost tech-savvy investor portfolios by $658 billion, or nearly 50%, according to Bloomberg.

Private and Concierge Services Soar

“There’s such a tremendous generation of wealth, a continuing sense of aspiration for finer things,” says Sherry Dewane, a UBS certified financial planner who has advised athletes and entertainers since 1997. The current rise in wealth creation has spurred the popularity of private and concierge services. “It’s really unprecedented; I personally have never seen it to this extent,” she says.

The short list of blue-chip services that cater to the moneyed: concierge health care; education consulting, spa, wellness and fitness services; aviation; travel; cuisine; and business coaching.

Exponential Wealth Generation

In her work with elite entertainment professionals, Dewane observes an overlap in the generating of wealth within industries. For example, she cites the surging gaming industry, a behemoth with annual revenue of $187.7 billion, according to a Forbes report.

“Games have been made from television or movies, and movies have been made from games,” Dewane says. “It’s a huge market.”

A lot of cash has been made by the gaming industry and digital designers in the niche market for virtual fashion, Dewane says. The purchase of gamer “cosmetics” (which includes fashion, accessories and “skins” that clothe avatars) adds up to a multibillion-dollar market in itself—$40 billion according to one account. Incorporeal leopard-print capri pants paired with blazing heels that are literally on fire might seem frivolous when it comes to creating wealth (Gucci, Louis Vuitton and other luxury brands would disagree, given their gamer collabs and partnerships). But Dewane says the subject points to a larger truth.

“There is tons of money, seemingly endless money, being poured into the catchall phrase known as ‘content,’” she says. “The delivery methods have changed and contracts have changed, especially in terms of name, image and likeness. That becomes quite valuable, given that money is generated each time it’s used,” including digitally.

The ripple effects are felt through numerous industries. “Consider Shohei Ohtani who just signed with the Dodgers for $700 million,” Dewane says. “He’s not the only one making money. All of the attorneys, agents, business managers and the handlers involved in that deal also have cash generation.”

The Wealthy Think Differently

The wealthy, along with the experts and handlers who surround them, “think in a different way,” says Ranjeet Guptara, a senior vice president, certified financial advisor and senior portfolio manager at UBS. “They think across generational lines: the grandparents, parents and the succeeding generations beyond. That requires multiple and layered perspectives as well as strategies.”

Inherited wealth across generations has increased in what the UBS Billionaire Ambitions Report calls “a great wealth transfer.” And it’s gaining momentum. For the first time in the report’s nine editions “… billionaires have accumulated more wealth through inheritance than entrepreneurship.” It’s a trend that UBS experts see as an “increasingly material factor in the creation of new billionaires.”

Different generations have different views about philanthropy, investing and business. “As they inherit their parents’ businesses, investments and foundations, heirs look to focus more on today’s major economic opportunities and challenges, such as innovative technologies,

the clean-energy transformation and impact investing,” according to the report.

The report found that all generations, however, have their eye on the opportunities and risks of generative artificial intelligence. “Around twothirds surveyed saw AI as offering one of the greatest commercial opportunities to their operating business over 12 months,” the report found.

The affluent also think in international terms. “Many of our clients work in multiple jurisdictions, and different parts of a family will reside in various countries,” says Guptara. “A whole team can be required to help people think in different currencies and to navigate varying interest rate regimes.”

Realtors Are Part of the Planning Team

In the U.S., the regime includes a marked interest rate escalation that began in March 2022, which “although fascinating and unprecedented,” Guptara says, “is not really something that should derail people from long-term planning.”

Such planning includes focusing on mortgage interest rates, especially adjustable-rate mortgages, which are always a ticking clock, Guptara says. “People are also staying in homes too long, unaware of the effect of interest rates when they come to re-mortgage,” he notes. “There’s this wonderful invention for family reunions called Airbnb; the reunion doesn’t have to be held in the family mansion.”

Dewane mentions a sometimes forgotten reality: “Realtors are part of the planning team, especially at the higher end of incomes,” she says. “Decisions must be made about the most favorable time to sell, and what shape a house is in, among other factors. Those who’ve lived in a house for a long time will likely have a multitude of embedded gains. Determinations need to be made about how to manage that

property as well as the taxes—choices that can result in benefits for the family.”

Both Dewane and Guptara agree that Realtors who finesse high-end deals must realize that they are negotiating for value and, indeed, “have the burden to prove value,” Guptara says. That’s especially crucial as the National Assn. of Realtors battles numerous legal challenges to its policies.

“With VIP homes, one faces an even more difficult task in terms of finding exclusive properties and dealing with very complex and sophisticated portfolios,” he says. “Quality is something such advisors continue to prioritize, and they’re rewarded commensurately.”

Changes in Tax Codes Shift Strategies

Strategies include using charitable remainder trusts, which enable donors to place cash or property in an irrevocable trust that pays a fixed annual income to the donor or a designated beneficiary. A charity receives the remainder of the trust once the donor dies.

“With changes in the tax code, we’re seeing far more of these,” Dewane says. “Not-forprofits are marketing them far more than they used to. In certain parts of the country, tax rates have increased, and so it can be a viable alternative for those who are charitably inclined to fulfill those desires while receiving a tax benefit.”

As tax rates change and, indeed, as overall change is constant, Dewane and Guptara envision a dynamic future for today’s Gilded Age.

“The pace of change will increase,” Dewane says. “No one has a crystal ball, but I don’t see quite the same thing” in terms of adjustments to current peak wealth generation, as compared with the first unprecedented round from the late 1870s to the Great Depression.

Guptara, in fact, believes that “we’re on the cusp of something even more exciting.”

Given the rising impact of artificial intelligence, related manufacturing digitization and big data, “we’re now in the fourth industrial revolution,” he says. “It’s only just starting to impact a majority of industries. Legacy processes are going to see a creative disruption and repurposing. That can only be a good thing. Hopefully there will be crossfertilization wherein everybody benefits.”

BRANDED RESIDENCES: A Triple Win for Developers, Brands and Buyers

By R. Daniel Foster

Consider Miami’s branded Baccarat Residences: a 75-story undulating glass tower with 360 homes and penthouses featuring “enlightened design” along Miami’s “brilliant Brickell waterfront.” For the fortunate few, this is where “life forever sparkles.”

Baccarat’s shimmering marketing materials describe the project’s “rarefied aesthetics” along with concierge teams always at the ready,

luxury limousine service and “custom scenting that captures the essence and energy of Miami.”

The tower, which is set to open in early 2028, will feature a jewel-box lobby hung with epic Baccarat chandeliers that seem to drizzle light.

The 250-year-old French maker of fine crystal is a new player in a real estate branding game dominated by Ritz-Carlton, St. Regis and other premium hotel brands. Such residences have

Mr. C Residences Coconut Grove, Florida

Photo credit: Arquitectonica

“exploded in the last five years,” says architect Bernardo Fort-Brescia, whose Miami-based firm Arquitectonica is an industry leader in the branding field.

The firm has designed 47 branded residences worldwide, with 13 more in development.

“These residences are designed to stand out from the crowd, to be special, to send a message that pairs with a luxury market,” Fort-Brescia says

Globally, there are about 700 branded residences, with nearly the same number in development, all scheduled to launch by 2030, according to industry research. A decade of rapid growth has seen such projects increase by more than 150%.

Restaurants and Haute Fashion Houses Enter the Market

Top-tier hotels are the logical market leaders in the branding stratagem because hoteliers are adept at offering elite integrated services. The Four Seasons Boston launched the modern concept in 1985, although the world’s first branded residence dates to 1927 when New York City’s Sherry-Netherland Hotel and apartments linked its fortunes to the popular restaurant Sherry’s.

Besides Baccarat, haute fashion houses are teaming with developers to create residences. Bulgari, known for its fine jewelry and watches, is building the Bulgari Lighthouse residences in Dubai, a mecca for residential branding.

Fendi, Armani and Cavalli have also entered the game, along with prestigious automotive brands Aston Martin, Porsche and Bentley.

Restaurant hospitality-branded projects are the latest to join—notably, the celebrated Cipriani brand, which in 1931 opened Harry’s Bar in Venice, attracting famous artists and actors. Four generations later, Arquitectonica

has designed the Cipriani Residences Miami, an 80-story curved glass tower with nautical detailing that suggests the Italian Riviera. It’s slated to open in 2026.

“It’s a gastronomic angle,” says Fort-Brescia, who launched his firm in 1977 with his architect wife Laurinda Spear. “The service and the food in these restaurants are amazing. In residences, you feel like you’re arriving at an elegant restaurant that’s within your own home.”

Non-hotel-branded residences, including those associated with restaurants, automobiles, fashion and jewelry, are expected to increase by 40% within seven years, comprising about 20% of the world’s branded residence stock.

Baccarat Residences Miami Miami, Florida

Photo credit: Arquitectonica

Enduring Brand Loyalty Drives Purchases

Buyers are attracted to such projects by the prestige associated with elite brands. Indeed, lasting brand loyalty motivates buyers of such turnkey residences.

“For people who are fashion lovers, car lovers, and for those who want high levels of service, the famous brand has an implication of longevity and even permanence—it delivers status and a certain way of life,” Fort-Brescia says. His firm has designed universities, symphony halls, airports and numerous other structures in 59 countries.

Younger buyers are being courted by brands known for having a “vibe.” Arquitectonica designed the Standard Residences in midtown Miami, a first for the Standard Hotels brand. Described as “Miami’s coolest building” (it

includes a karaoke bar, co-working spaces and a meditation studio), the 12-story property with 228 residences was 50% reserved within two weeks of launching in 2021.

All of the branded projects tout impeccable service, which is especially important for owners on vacation. Wellness and experiential amenities have “become the No. 1 factor for many,” Fort-Brescia says. “There must be amazing fitness centers, spas or at least spa services.”

“Homes in the Sky” Are Themed to Brand and Location

Branded homes are often massive and almost otherworldly in their aspirations.

The four penthouses at the Ritz-Carlton Residences on Florida’s Sunny Isles Beach

The Ritz-Carlton Residences Sunny Isles Beach, Florida Photo credit: Arquitectonica

step down from a 649-foot curvilinear tower. They start at 6,000 square feet and top out at nearly 10,000 square feet. The penthouses’ 4,000-square-foot terraces include pools, gardens and summer kitchens. The four homes were pre-sold before the property’s opening in 2020, with the first selling for $26 million, Fort-Brescia says.

Interior designers must closely tailor the decor to both the brand and its location. The RitzCarlton Residences in Sunny Isles, for example, has a nautical feel, with sumptuous interiors designed by Florentine architect Michele Bönan. Miami’s Porsche Design Tower includes a practical amenity: the Dezervator, an elevator that transports homeowners and their autos (presumably Porsches) from ground level to their residences.

Branded Residences Deliver Premiums

Fort-Brescia believes branded residences are a triple win: The brand benefits from exposure and enhanced prestige, the developer scores with premium prices, and owners can profit from an investment with a higher resale value, given favorable markets.

“As investors, homeowners perceive that a branded residence adds a certain sense of security and value,” he says, adding that the properties can fetch lucrative rental fees. “And for developers, they seek a certain safety net—a sophisticated and prestigious address that can deliver a higher price.”

Fort-Brescia estimates premiums for such homes to be about 25%, based on industry talk. Surveys have found that it’s higher, with the

The Edition Residences Miami, Florida Photo credit: Arquitectonica

overall global premium averaging 30%. Research breaks out that average, tying it to location. Residences in global cities bring in a 24% premium and in resort locations 32%. Emerging cities top out at 52%.

“Speed of sales and price” are principal factors developers track when initiating projects, Fort-Brescia says. “The acceleration of sales is important because the sooner you do your pre-sales, the faster you’re ready to finance and build.”

“The pre-sales for phase one of the St.-Regis Residences in Sunny Isles will total about a billion dollars,” he adds. “And they’re big deposits, about 50%. These are expensive projects.” Both the Baccarat and St.-Regis Residences are designed by Arquitectonica. Buyers gravitate to branded residential centers such as Miami and Dubai because the metropolises offer a variety of housing choices, as well as the thrill of being in a hub of luxury living.

South Florida has 42 branded projects. Dubai has 51 projects, with that number set to double by 2030. North America hosts one-third of such residences.

Arquitectonica has designed 19 branded towers in Miami, with six projects in development. “This is where it all got invented,” the architect says.

New Markets Emerge

Developers are eyeing emerging markets that can fetch top premiums. For the first time, Arquitectonica has projects in Vietnam, “one of the hottest spots in Asia” for the branding model, Fort-Brescia says.

“The country is rising from a baseline that allows for a lot of growth–there are many newly wealthy people that desire such homes,” he

says. Aspirational locations that entice tourists, with Miami and Dubai topping the list, make for optimal target locales. Add high demand for residences and scant stock, and developers and the brands they court trust they have a winner.

Other burgeoning markets for the model include Saudi Arabia, Egypt and Mexico, along with the Mediterranean and the Caribbean, with the latter region set to double its 23 projects by 2030.

“Europe somehow is not as common for branded residences,” Fort-Brescia says. “Just now, we have an inkling of a project in Europe, which would be our first. And for the first time, we received a call for a new branded residence in São Paulo. So yes, it’s starting to percolate to other locations.”

Residential Towers as Art Objects

Arquitectonica knows that its buildings must be considered art objects, especially by buyers. “It has to be unique, it has to send a message,” Fort-Brescia says. “The Baccarat towers are almost like a glass chandelier, right? Like they’re dripping. The lobby, the building—you feel Baccarat.”

Among Fort-Brescia’s more arresting structures: the twin 62-story towers he designed for the St. Regis Residences in Sunny Isles, reminiscent of extraterrestrial spacecraft in the 2016 sci-fi film Arrival.

“The St. Regis towers are very distinctive from very far away,” Fort-Brescia says. “And look at the west side—all solar panels. So the building has a clear sustainable message, also important in today’s world.”

Cipriani

Photo credit: Arquitectonica

IT’S ALL ABOUT WHO YOU HIRE— USING LANGUAGE PSYCHOLOGY TO RECRUIT ACE TEAMS

By R. Daniel Foster

Why do some companies enjoy accelerated and sustained growth in defiance of supply-chain glitches, rising inflation and political disruption? Are they just lucky?

After analyzing 30,000 businesses and millions of leaders over a 15-year period, business model expert Christopher Skinner believes he has the answer. It doesn’t involve capital, a stellar business plan or genius marketing.

“It’s because of who they hire,” he says. In analyzing businesses and their employees, Skinner pondered how the most successful companies recruited ace teams with members akin to the “PayPal Mafia,” a dozen-plus entrepreneurs (Elon Musk, Reid Hoffman and Peter Thiel, among others) who once worked at PayPal and later launched major companies.

“It turns out that it’s not random,” says Skinner, founder and managing partner of New Orleans-based Stealth Dog Labs, which builds organizations using disruptive innovation technologies. “It takes purpose,” he says.

Analyzing Language Data to Identify Personality Types

But how does a company identify and then hire “good people?”

When Skinner started his career, he knew he needed a methodology, one that uses the psychology of language to determine individual and team mindsets. By studying vast amounts of speech and text found online, it would be possible to identify archetypal personality types and, indeed, the personalities of entire organizations.

Opportunists, for example, are known to excel at sales, and results-driven individuals can make superb leaders. By contrast, some personalities—self-saboteurs, narcissists and martyrs—can become company tripwires.

The problem he faced, however, was how to gather and then evaluate millions of words and phrases—language puzzle pieces that he could assemble into portraits of personality types.

“I built a crawler,” Skinner says.

Specifically, Skinner, a designer and builder of search-engine algorithms, built his first psychology-focused search engine in 2010. “Really, no different than what Google does,” he says. “It just collects words.”

Skinner has become one of the few people to study language density at scale, his work utilized by Google, Vodafone, Bose, Target, Oreck, United Airlines and SpiderOak cybersecurity, among others. When studying such data, he identifies words and phrases that organizations and individuals frequently repeat,

removing personal factors. He then categorizes the findings into basic personality types.

For example, results-driven mindsets favor such words as “complete,” “obtain” and “secure,” as well as future-tense words. Such types quickly get to the point, are highly outcome oriented and are not distracted. “It’s the right role for leadership,” Skinner says.

Sales whiz opportunists use hedge words such as “because,” “therefore,” “if” and “then.” Skinner notes that analyzing language usage is a nuanced art, so his findings might not be obvious to others.

“I didn’t invent language psychology,” says Skinner, who has a degree in abstract mathematics along with three tech automation patents. “But over the last hundred years, psychologists have learned that if you use too many of certain words, it means something.”

Qualities of Successful Leaders

Successful leaders are usually results-driven, but they’re also system thinkers, a mindset that values relationships and varied interactions among teams and networks. Examples of system thinkers are Jamie Dimon; Steve Jobs; Whitney Wolfe Herd, co-founder and now chairman of the online dating platform Bumble; and author Reshma Saujani who founded Girls Who Code, which aims to close the tech gender gap.

“Systems thinkers can float and comprehend very ambiguous things,” Skinner says. “A person at that level combines things and sees how they relate, a process that doesn’t normally make sense to most of us. If you have enough of that, and blend it with results-oriented thinking that targets outcomes, it’s going to be very profitable for everybody. These are win-win types. They figure out how to make it all work.”

Skinner, who has ingested a wealth of language data, sometimes observes similarities between individuals. He notes that FTX cryptocurrency exchange founder Sam Bankman-Fried and biotech blood-testing entrepreneur Elizabeth Holmes, both convicted of fraud, share similar language density patterns.

The pair, and others like them (“the list is quite long,” Skinner says), use fewer emotional words and have an “increased use of cognitive processing words like ‘think,’” he says. They also tend to use the words “possibly” and “navigate.”

Skinner has used various methods of assessing personality, including the Myers-Briggs Type Indicator and the Five Factor model, commonly called the Big Five, but he prefers the work of William R. Torbert. “Torbert describes people very simply,” he says. “Once you learn Torbert’s concepts about mindset, you have a very good idea of what kind of person you’re talking to.”

Skinner advises employers to give personality tests to potential hires, adhering to laws that prevent violation of privacy.

Every Company Has a People Operating System

A company’s “people operating system” is ultimately what determines continuing success, Skinner says. He arrived at the phrase after observing the ecosystem of employees, vendors and customers that surround companies.

“All these people should be working toward a common purpose, all of them more or less in sync,” he says.

Skinner offers the example of AutoZone, which sells automotive replacement parts. The company has nimbly adapted to changing markets and technologies over its 45-year history. In 1999, it made its debut on the Fortune 500 list, and in 2021, Forbes ranked it No. 39 out of 750 multinational companies and institutions on its World’s Best Employers list. AutoZone has more than 7,000 stores in the U.S. and other countries.

“I don’t doubt that the CEO and who he’s surrounded himself with are exceptional,” Skinner says. “He’s got an operating system that’s spot on.”

Linking Personality Types to Selling Luxury Real Estate

Filling the right slots with the right people is the optimal way to develop such an operating system. Sales-minded opportunists, for example, excel at making things happen. “They find a way to win,” Skinner says. “And they’re very good at emergencies. But that’s a very selforiented position. Their purpose, and really their subconscious purpose is, frankly, themselves.” They do best when sticking with sales.

Placing personality types in the wrong position can create friction, both within the individual and the company. Opportunists, for example, might be good at selling conventional real estate, but not brokering elite deals. “They’re not going to survive long. Do they exist? Yes, they’re out there. But are they closing the volume of deals they could if they would just think a bit more customer-centric?”

In luxury real estate, the customer often has infinite choices, “and if a potential buyer doesn’t feel like they have a team player, they’re going to walk,” Skinner adds. Rather, top-tier brokers are often system thinkers who are resultsdriven. Empathy also helps in understanding affluent, multifaceted mindsets.

Much like the “PayPal Mafia,” “once you get that team right, then it takes off,” Skinner says. “PayPal was a force precisely because of that team. They didn’t join forces haphazardly; it was with a purpose. Before PayPal, you went to your bank. They created an industry.”

Results-Driven Leaders Drive a Company’s Success

Companies that lose too many results-driven leaders usually suffer. After the 2008 subprime mortgage crisis, JPMorgan Chase Bank struggled. “If you look at the top 1,000 leaders

in the company, they lost a disproportionate number of results-driven leaders,” Skinner says. “It was just a bad time to be in the banking business, and they were paying for that.”

Around 2013, Chase, the largest bank in the United States, “started hiring results-driven leaders again and it’s paid off,” Skinner says. Skinner considers Chase’s CEO and chairman Jamie Dimon to be “one of the highest results-driven system thinkers running a company today. I’ve analyzed his text for two decades (speeches and other communication). His mental capacity has matured. He’s as skilled as Jeff Bezos. He’s in a rare, rare club, and he no doubt surrounds himself with capable people.”

Other companies don’t bounce back like Chase did. Skinner cites Unisys, a global technology solutions company. “Unisys’ stock has declined over the past 20 years,” he says. “But what’s interesting is, almost every year they do a little worse. And they’re not alone. When you look at how they think, how they use language, it’s not results-driven. They tend to be a great group of experts who are highly disciplined. But they’re not solving customers’ problems.”

Disciplined experts often resist change, have limited flexibility and are slow decision makers, according to Skinner. Some businesses do fine with disciplined experts, he adds, because they’re not driven to innovate.

“But I don’t know many businesses that are not on pins and needles over the next 10 years,” Skinner says. “If you feel that decisions are not being made fast enough, and the company is suffering from limited flexibility and resistance to change, then bringing in results-driven systems thinkers could be an answer.”

LUXURY TRAVEL ACCELERATES AND DIVERSIFIES

By R. Daniel Foster

The global luxury travel market, worth an estimated $1.5 trillion, continues to accelerate as well as diversify after an initial post-pandemic lift. Travel demand and spending, fueled by a near-insatiable curiosity for novel experiences, is expected to increase in 2024, reports Virtuoso, a global network of luxury and experiential travel agencies and advisors.

Wealthy travelers, however, are not all alike. Although some high-net-worth individuals might

spring for a $10K champagne bubble bath at Florence’s Il Salviatino hotel, others might choose to soak in Esalen Institute’s hot spring baths perched on California’s Big Sur coast.

Still, the moneyed traveler is usually discerning.

“Our traveler is very much the tastemaker, the trendsetter amongst their peers,” says Shannon Knapp, president and CEO of Leading Hotels of the World (LHW), a collection of more than 400 five-star independent luxury hotels in more than

80 countries. “They’re constantly looking for what’s next. They’re taking more trips than ever, they’re spending more than ever, and they’re staying in larger rooms.”

Emerging Destinations Lure the Luxury Traveler

After a post-pandemic return to such favored spots as Italy, France and Greece, wealthy travelers are putting new pins on the map and venturing to Japan, Croatia, Iceland, Portugal and Antarctica, according to Virtuoso.

Saudi Arabia is also a contender, given its $800-billion tourism moonshot, part of a Vision 2030 government program that aims to reimagine an economy historically dependent on oil. Among numerous projects in development: Sindalah, a luxury island for yacht enthusiasts with three prestige resorts, and the fantasy city of Qiddiya, with a focus on entertainment, sports and culture that’s rising from the sands much as Las Vegas did.

Iceland, far from the searing desert, also presents a significant opportunity for the luxury market, Knapp says. “The idea of luxury continues to evolve conceptually there. More and more luxury travelers are keen to experience the country’s raw natural beauty.”

Kyoto, a former imperial capital of Japan, is also attracting luxury travelers drawn to its culture and traditions. LHW’s collection includes Fauchon Hotel Kyoto, adjacent to the city’s vibrant Shijō Kawaramachi district, and it will soon add another.

Exclusive Access to Authentic Experiences

Eighty percent of the hotels in LHW’s portfolio are family led and more than 90% are independent. The world’s largest collection of such properties was founded by hoteliers for hoteliers in 1928. Its storied hotels, many of which have been owned by multiple generations, point to another trend among elite travelers: the craving for unique experiences authentic to the destination.

“Destinations have evolved around these familyowned hotels,” Knapp says. “The owners have relationships with the artisans and shopkeepers that run deep.”

Knapp cites a recent trip to Italy with friends that began with a jaunt on vintage Vespa scooters arranged by the proprietor of Hotel Santa Caterina in Amalfi. They headed to the popular Concettina ai Tre Santi pizzeria in Naples, but it was closed for a holiday. The hotel’s proprietor, however, knew the chef, Ciro Oliva, whose family has run the pizzeria for more than 60 years.

“Ciro came down with his pizza chef, opened the restaurant, and prepared a tasting menu of five pizzas paired with champagne,” Knapp says. “It was an extraordinary experience.”

A hotel’s architecture and interior design are integral to authentic experiences. The tile work at LHW’s Le Sirenuse in Positano, Italy, for example, has a storied history. The father-and-son firm of

Fornace De Martino creates the tiles; their family enterprise has been firing kilns for more than six centuries.

A venerable Florence property, the Place Firenze, has gone a step further, establishing the Place of Wonders Foundation to “protect, preserve, and promote the human heritage of Italian craft.” The foundation funds scholarships for Italian artisans and offers hotel guests curated visits to local workshops to view creations in glass, gold, porcelain, cashmere and scagliola, a decorative technique that mimics marble.

Brands Team Up to Deliver Singular Journeys

Cross-brand alliances are another luxury trend, what the professional services firm Deloitte describes as “collaboration across the luxury brand ecosystem.” Notably, Accor Hotels has teamed with the SNCF Group (France’s railway company), owner of the legendary Orient Express brand. Three Accor hotels are being developed under the brand, which will also offer private journeys in restored Orient Express cars as well as on a branded sailing ship.

When properties strike up partnerships with local charities, such cross-brand alliances can create truly transformational experiences for guests. Jean-Claude Messant, managing director at Morocco’s Royal Mansour Marrakech, has partnered with the Fiers & Forts Center, a local refuge for orphaned, disadvantaged and abandoned children. If they wish, hotel guests can make a donation or volunteer with the organization.

Leaving a destination better than they found it is “a big, big trend among luxury travelers,” Knapp says. “People want to come back home feeling better than when they left.” Unlike other packaged charity experiences, guests’ involvement with Fiers & Forts feels authentic, Knapp adds. “You can be a part of changing the lives of these kids.”

The Hallmarks of Slow Travel

Along with transformational experiences, slower, more focused travel is having a moment. That includes unhurried transportation, reports Deloitte, on trains, luxury yachts and smaller vessels, all paired with longer vacations. The global yacht charter market is expected to surge at a compound annual growth rate of 22.8% through 2027, reaching a value of $25.5 billion, according to Deloitte.

“People are traveling both slower and deeper,” Knapp says. African safaris excel at shifting perceptions about time and how it’s spent, whether it’s a meerkat immersion experience at the edge of the Kalahari or encounters with decidedly chill Angolan colobus monkeys in western Rwanda.

Wellness is a part of slower travel, and vacationers are willing to pay extra for high-class amenities. Although destination spas and retreats such as Canyon Ranch and Six Senses are popular, “it’s no longer exclusively about how big your spa is and how many massages you can offer,” Knapp says. “It’s about how you’re enabling guests to personalize their wellness experience. It’s about the programming and how deep and intense you want to go.”

Offerings that go beyond aromatherapy and hot stone massages include art therapy, Knapp says, and “wellness butlers” who can recommend tailored cuisine and spa treatments based on a full-body assessment.

Sustainability Includes Local Values

Sustainability continues to be a buzzword luxury travelers search for when choosing properties.

LHW includes a Sustainability Leaders Collection of 78 certified properties that range from sleek urban towers to tented rainforest retreats.

Hotels that incorporate sustainability into building design and operations attract more eco-conscious luxury travelers—74% of whom are willing to pay extra to travel more responsibly. And sustainability increasingly means safeguarding a destination’s cultural heritage, traditions and values.

Hyper-Personalized Luxury Travel

The ability to hyper-personalize luxury travel has reached new levels because technology can track and manage guest preferences. “In the past, you had a world-class GM with a great Rolodex filled

with everything about guests,” Knapp says. “Now, the depth of personalization is far greater.”

The trend includes luxury travel advisors who, like traditional travel agents, shoulder the timeconsuming task of assembling and booking itineraries. The advisors are favored by 85% of luxury travelers, according to Deloitte. Velocity Black, described by the Wall Street Journal as a “turbocharged concierge service,” offers “bespoke bucket-list itineraries” using an exclusive membership app. Virtuoso, in contrast, touts its advisors who possess in-depth knowledge of such diverse places as Afghanistan and Tonga.

The ability to choose a cutting-edge app or an actual human advisor is the hallmark of luxury travel, Knapp says.

“Luxury is truly personal,” she says. “What’s luxury to me is not necessarily luxury for you. You can’t paint the luxury traveler with a single brush. But they are often intellectually curious, and they want to be challenged. And they’re out exploring, contributing and experiencing.”

Turpin Realtors

Pendry Residences Peapack-Gladstone, New Jersey

3 OUTSTANDING PROPERTIES THAT DEFINED 2023

Discover the standout stories and premier properties that captured the spotlight on Forbes.com.

OUTSTANDING PROPERTIES THAT DEFINED 2023

By Lauren Beale

Royal Roots

Whether owned by crowned heads, monarchs or sovereigns, our readers are intrigued by the King Midas touch. Rising to the top of our most well-read stories for the year was Sweden’s Herrevad Castle, once a medieval power center coveted by popes and kings. The former monastic house, royal farm and military facility dates to the 12th century and has ties to the Knights Templar, a mysterious order that

attained immense wealth and political power during medieval times. “You can sense the story of the abbey and castle as you walk through,” said Beqo Hoti, Shaza Luxury Real Estate founder. “The monk, the knights—you can’t help but visualize the history.”

Following close on the heels of Herrevad Castle among reader favorites was a coastal California estate owned by Hollywood royalty: Oscarwinning director James Cameron. His favored

Building Heritage Gucci Villa Rome, Italy

writing retreat sits on a 102-acre oceanfront parcel in a biodiverse haven among the world’s richest. “I would just bounce up there and sequester myself for months on end,” Cameron said of writing most of the first Avatar script and about half of the next two installments from his Hollister Ranch getaway, which Village Properties listed midyear at $33 million.

Arguably both royalty and celebrity, fashion king Marc Eckō proffered his Gilded Age estate called Stronghold in Bernardsville, New Jersey, through Turpin Realtors. The mogul gutted and restored the formidable 20,000-square-foot stone manse and tower, which date to 1886. It really does look like a castle.

Sports Minded

Professional athletes always draw their share of fans. Los Angeles Rams wide receiver Cooper Kupp marketed his off-season home, a 4-acre spread in Wilsonville, Oregon, with LUXE. Among amenities was an indoor training facility known as “the barn.” “Our family made a lot of incredible memories in that home but, man, that barn really is special,” Kupp said in an email. “I did the majority of my off-season prep there in the lead-up to our Super Bowl season. Also, and maybe, more importantly, I got to make memories with my family running around and playing on that turf.”

Another sports-figure owned home that wowed an audience: LUXE’s listing of former Portland Trailblazer CJ McCollum’s home in the Portland suburb of West Linn. The contemporary lodge was once a show home featuring the latest in construction and craftsmanship.

Art and Fashion

Historical figures rose to the fore. It’s hard to find a bigger name in the art world than that of Italian Renaissance artist Michelangelo. A villa from his childhood in Florence, Italy, sold with Building Heritage representing both sides of the transaction for an undisclosed amount.

Offering a look back into fashion history was the museum-like North Rome villa built in 1951 by Aldo Gucci and filled with antique furnishings, crystal chandeliers and tapestries. “Everything’s original,” said listing agent Chiara Gennarelli of Building Heritage. “The hasn’t changed anything, even during renovations.”

Of Historical Note

Willis Allen Real Estate found a sweet spot with two Southern California properties tied to local history. With occupants descended from the prominent Sepúlveda and de la Guerra families, a La Jolla hillside home is about as close to San Diego royalty as one can get. A noted architect and landscaper further add to the claim to fame.

Village

James

Emily

And a rare Victorian-era home―its gas-lit heyday marked by white-glove soirees―drew attention in San Diego’s Bankers Hill district. The 1889 Queen Anne-style home, with its dome-topped tower, wraparound gingerbread porch, carriage house and impeccably maintained interior, is a standout example of its architecture and time period. “It’s one of the top 10 Victorian-era homes in the city,” said Bruce Coons, executive director of the Save Our Heritage Organisation.

Lifestyle Trends

Emerging lifestyle changes caught the imagination: move over cabins in the woods and second homes in clubhouse-centered communities. Several properties marketed by Tahoe Mountain Realty fit the bill for buyers looking for an authentic mountain experience and favoring adventure and acreage over amenities.

Amenity Driven

Unusual or outstanding amenities always pique reader interest, but rising to the top in 2023: a fascination with viticulture. In addition to thriving vineyards, two-thirds of a mile of riverfront and 260 acres combine to make a LUXE listing in Southern Oregon’s Applegate Valley more than a hobby vineyard.

Price Giant

Not to be considered an also-ran was a behemoth mansion in Hong Kong listed at US $281 million. OKAY.com, one of the firms representing the mega-mansion, described it as one of the most expensive properties within the city. With more than 18,000 square feet of polished living space there’s plenty of room for a party of 100.

Desert Trailblazer

Tapping another way to connect with nature is Natirar, a community focused on sustainable living—there’s a working farm—and wellness in Somerset County, New Jersey. The 90-acre spread will include a refresh of an existing historic mansion, new Pendry Natirar hotel and 24 newly built gated residences. Turpin Realtors listed a pair of these Pendry Estate Residences.

Twenty modernist 3D-printed houses are rising about 10 miles north of Palm Springs, California. Unlike some less sophisticated 3D-printed models, the well-designed homes are sleek, minimalist and smart. Three of the zero-net energy Desert Hot Springs residences, called Quatro, co-listed with EQTY and Hilton & Hyland.

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LUXE

Cooper Kupp Off-Season Home Wilsonville, Oregon

Turpin Realtors

Pendry Residences Peapack-Gladstone, New Jersey

Shaza Luxury Real Estate

Herrevad Castle Ljungbyhed, Sweden