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Rich Arabs rush to London homes
The city's attraction among Middle Eastern buyers heightened after the Arab Spring uprisings last year.
November 8, 2012 9:36 by Reuters
High-profile buyers this year include Egyptian mobile network billionaire Naguib Sawiris, according to two people with knowledge of the transaction; he paid about 37 million pounds for a flat in Knightsbridge, British media reported.
One of London’s most expensive homes currently on the market is a 45-bedroom mansion that belonged to former Lebanese Prime Minister Rafik al-Hariri until his assasination in 2005. It is on sale for a price tag of between 200 and 300 million pounds, property agents said.
As overseas buyers flee political strife at home and protect themselves from reprisals, safety measures such as panic rooms and gun safes have become more popular in new high-end London homes.
Luxury development One Hyde Park has panic rooms and bulletproof windows. The project was financed by a joint venture that includes a company owned by the prime minister of Qatar.
In addition to homes, Middle Eastern sovereign wealth funds such as the Qatar Investment Authority have spent billions of pounds on offices and shops in London, including the development of Britain’s tallest skyscraper, the Shard.
Qatar was the top sovereign wealth buyer of European property in the 12 months to August, spending 3.5 billion euros ($4.6 billion) on eight deals including the London Olympic athletes’ village and a mall on Paris’ Champs Elysees, data from research firm Real Capital Analytics showed.
Some market participants, such as Development Securities , have warned that overseas demand for London’s luxury homes could be hit hard when demand for the city’s safe haven role eventually eases.
A May report by the property developer warned that London luxury home prices could halve if the euro zone broke up, since the appeal of sterling might disappear as weaker European currencies created bargains elsewhere.
The love affair between the global super-rich and London property is also at risk as the British governmentconsiders increasing taxes on owners of the most expensive property, tapping into a public mood of resentment toward the wealthy.
But Bailey said Middle Eastern investors had become a fixture in the London market.
“For the last two years people have asked, when would this end, and it hasn’t done – it’s actually been pretty strong. So it’s difficult to see when it would end.”
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