Despite a cooldown in many property markets over the past year, FORBES now counts more real estate billionaires this year than last. Twenty-three people join the FORBES Billionaires List in 2015 thanks to their real estate holdings, bringing the total number of real estate tycoons on the list to 157.
Of the 20 richest property moguls in the world, more than half (12) hail from Asian-Pacific nations. Seven are from Singapore, three from China, and one each from Singapore and Taiwan. Four of the wealthiest 20 property billionaires are American, three are from the U.K., and one is from the United Arab Emirates.
If that sounds like surprising news given the many headlines about Asia's (specifically, China's) property bubble, consider a few factors. First, the headlines are most often talking about housing (Chinese), which is indeed facing challenges. Second, many of Asia's real estate billionaires are benefiting from commercial properties. And finally, in general the picture for Asia is positive. Mature Asian centers with track records of stability, transparency, and long-term economic track record--and this excludes post-super-growth-streak China--are doing just fine.
"We do expect rents to decline in Beijing and Shanghai due to large development completions," says James Roberts, partner and chief economist at Knight Frank. "Also, in cities that rely on mineral exports, like Perth and Brisbane, we see rents as flat this year. However, for developed Asia (Tokyo, Hong Kong, Singapore, Taipei) we expect rents to rise this year."
Globally, office rents rose 7% in 2014, more than double the annual 3% increase the world has seen each year since 2010, according to Cushman & Wakefield research. In terms of rental prices, Hong Kong's Central Business District ranked the 2nd-most-expensive office market in the world, behind only London's West End. Last year ended with the lowest vacancy rates seen in years for multiple Asian markets, adds Knight Frank.
On the other hand, Knight Frank's Global House Price Index, which tracks residential prices in 54 countries, shows that as of Q3 2014 (the latest data available), residential property rose just 0.1% from the prior quarter--or 3.3% in the twelve-month period ended September 2014. Figures of course vary widely by country. Ireland, Turkey, Dubai and the UAE led the pack with annual price increases of 15%, 14%, and 12.5% (both Dubai and the UAE), respectively. China saw a 1.2% decline overall, with 58 of the 70 cities Knight Frank tracks posted a decline over the 12-month period that ended in September 2014. Cyprus, Slovenia, and Greece fared worst of all the nations Knight Frank follows, with declines of 7.7%, 8.8%, and 9.2%, respectively.
Given the positive performance of the Asia-Pacific region in general, it's not surprising that so many of the top 20 real estate billionaires hail from that part of the globe. In fact, the Asia-Pacific leads the world in terms of real estate wealth, claiming a whopping 96 of the 157 global real estate billionaires. The United States, with 33 real estate billionaires, is a distant second, followed by Europe with 19. (Not included in the grand total of 157 real estate billionaires are another 45 people who owe their billions at least in part to property, though their holdings are more diversified.)
Country-by-country, the U.S. boasts the greatest number of real estate billionaires, with 33. China has the second-highest number of the property-rich at 30, followed closely by Hong Kong, with 24 real estate billionaires.
The wealthiest real estate tycoon in the world is Hong Kong's Lee Shau Kee, at No. 27 with a fortune FORBES estimates at $24.8 billion. Lee has raised his stake in his Henderson Land Development, showing he's still bullish on Asia's property sector. An investor in Hong Kong's iconic International Financial Center, Lee has been involved in many mainland projects include the Henderson Metropolitan along Nanjing West Road near the Bund, a waterfront area in Shanghai. He controls other publicly traded Hong Kong companies including the Miramar Hotel and Hong Kong and China Gas. Lee's early business partner was the late founder of Sun Hung Kai Properties Kwok Tak-seng, whose sons all are among the world's billionaires. Despite Asia's struggles, Lee's fortune is up from the prior year--as are the next following Asian tycoons.
The second-richest real estate billionaire in the world (No. 29 with a net worth of $24.2 billion), is China's Wang Jianlin. He runs Dalian Wanda Group, a commercial real estate juggernaut that controls more than 200 department stores, shopping plazas and luxury hotels. In August 2014 he formed a joint venture with Internet giants Baidu and Tencent to set up an e-commerce company called Wanda E-Commerce and announced investment projects in Beverly Hills, Australia and Chicago. In December 2014 he raised $3.7 billion when he listed his Wanda Commercial Properties in Hong Kong. Born in Sichuan Province in 1954 just after the Communist revolution, in 1970 he entered the military, where he remained until 1986 when he took a city government job in Dalian in Liaoning Province. He became chairman of Wanda, which was government-run, in 1989 at age 35.
Brothers Thomas and Raymond Kwok of Hong Kong jointly take the third slot among property tycoons, at No. 58 with a joint net worth of $15.9 billion. Thomas Kwok was found guilty in December 2014 of bribing the city's former number two official and sentenced to five years in prison; Raymond was cleared of all charges. Upon the verdict Thomas resigned from his posts at Sun Hung Kai Properties, the developer that built many of Hong Kong's iconic skyscrapers. Today, Raymond is the sole chairman of the publicly traded group. The brothers' legal trouble came shortly after the duo ended a long-running feud with their older sibling, Walter, who's now listed separately as a billionaire. The Kwok brothers inherited the property business after the death of their father Kwok Tak-seng in 1990.
Donald Bren, No. 69 on the FORBES Billionaires list, is the 4th-wealthiest property tycoon in the world and the richest in in the United States, with a net worth of $15.2 billion. His Irvine Company owns 500 office properties, more than 40 shopping centers, 50,000 apartments, three hotels and several golf clubs and marinas, mostly in Southern California. Bren's father was a real estate investor and Hollywood film producer, and Donald grew up working as a carpenters' helper on his father's buildings. In 1977 he bought Irvine Company, which started as a ranching operation 150 years ago, with a group of investors, and now owns the whole company. The firm has donated 55,000 acres of Orange County property for conservation.
Asia-Pacific region leads the world in terms of producing new billionaires. Of the 23 new property billionaires on the FORBES list, 18 are from Asia: seven are from China, five from Hong Kong, two are from India, and one each from Australia, the Philippines, Singapore, and Taiwan.
The United States also added three new billionaires to the FORBES list. Jay Paul debuts on the list with a net worth of $1.5 billion; as my colleague Katia Savchuk wrote in December, he rents Silicon Valley office space to world-famous companies like Microsoft, Amazon and Google. He is also building a 56-story building in San Francisco that will be the tallest mixed-use tower west of the Mississippi. Sanford Diller, whose Prometheus Real Estate Group is one of the largest apartment owners on the West Coast, with 18,000 units across California, Portland, Ore., and Seattle, is the second American newcomer, with a net worth of $1.3 billion. B. Wayne Hughes, Jr., whose father founded self-storage giant Public Storage, is the the third new American, with a net worth also at $1.3 billion.
