As 2023 saw the world navigate through periods of economic turbulence, political instability and global conflicts, there was one thing that remained as it always has: the appeal of the London property market.
In the Spear’s Property Survey conducted earlier this year, leading property agents revealed their scepticism as to whether London will continue to attract buyers and investors, but all remained unanimous in their belief that high-end homes in the city’s super-prime postcodes would continue to enjoy high returns.
[See also: What is the state of the London property market in 2023?]
Our experts were proven right, to an extent, as London saw notable residential openings (the likes of The OWO Residences by Raffles and The Peninsula London) and rivalries between property agencies hotting up. But the industry experienced some lows too, namely a drop in sales as UHNWs turned to renting.
To mark the end of a tumultuous year, Spear’s charts the year’s most significant developments in the world of property in 2023.
Sotheby’s International Realty cements its place in London
2023 began with a bang for the London super-prime property scene as Sotheby’s International Realty further cemented its place in the city. The UK branch of the luxury property agency was acquired by its Middle East arm, owned by George Azar.
Azar, a former banker, cited his reason for the purchase as the brand’s appropriate next step to ‘forge a path of resilience’. ‘In the realm of luxury real estate, we are not just changing a name; we are reshaping the narrative and setting a precedent for the future,’ enthused the CEO.
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As the year draws to a close, UK Sotheby’s International Realty is hitting the headlines more than ever before as Azar makes a play for London’s most esteemed property agents.
Recent heavyweights joining the business include Marcus O’Brien (formerly of Beauchamp Estates), Claire Reynolds (formerly of Savills), Andrew Chambers (formerly of Knight Frank) and Becky Fatemi, whose firm Rokstone was acquired by Azar.
It’s unclear what the future holds for the business as it competes with more established rivals but it’s certain that Azar, like any successful entrepreneur, isn’t afraid of taking a risk.
UHNWs show a preference for rental properties
Against a backdrop of economic uncertainty, London’s ultra-prime rental market in 2023 rebounded to pre-pandemic levels. Rent in the capital’s prime postcodes has surged by 8.8 per cent year-on-year while the sale of super-prime properties drops.
According to a report by Beauchamp Estates, UHNWs’ preference for renting stems from high interest rates, stamp duty and the threat of a Labour government.
Erik Holmgren, lettings manager at Beauchamp Estates, says: ‘Over the past six months, Beauchamp Estates has secured super-prime lettings deals which have generated combined annual rental income of over £5.5 million, with tenants from America, China and the Middle East being particularly prominent in the PCL market over the last six months.’
The rise of branded residences
The popularity of branded residences exploded across 2023, with some of the world’s most famous luxury hotel brands joining developers to create luxury apartments.
A 2023 report by Knight Frank revealed that the current pipeline of branded residences is projected to increase the global total by almost two-thirds. The vast majority of completed branded residence projects are in North America while the highest pipeline growth is in the Middle East.
Wealthy buyers have found that branded residences provide ‘reassurance and comfort’, says James Forbes, Spear’s top flight buying agent who has been involved in some of the biggest transactions of branded residences in the London market to date.
But the brand alone isn’t enough to guarantee interest from discerning buyers, especially as new luxury residential developments (without a brand attached to them) have popped up across London this year. Forbes tells Spear’s that branded residences can’t be too reliant on the name stamped above the door. ‘It still has to be the right building, the right part of London and the right service within it.’
Notable residential launches
2023 saw the launch of London’s two most anticipated residential/hotel projects: The OWO Residences by Raffles and the Peninsula London.
The Peninsula London, by Hyde Park’s Wellington Arch, opened its doors for hotel stays in September capping off the brand’s 30-year journey to find the perfect London address. With 25 ultra-luxe residences available — ranging from one- to four-bed apartments — HNWs have flocked to the development with its promise of delivering ‘discretion, privacy and security’.
The OWO Residences by Raffles saw similar acclaim with some referring to the hotel brand’s entry into London as ushering in ‘a new era of super-luxe hospitality’. The building, once the former offices of political figures including Winston Churchill and Profumo, was purchased in 2014 by the Hinduja family for £350 million.
[See also: The OWO Residences by Raffles is about legacy, says Sanjay Hinduja]
After a six-year renovation project, the OWO welcomed its first guests this summer alongside residents for the 85 apartments available on-site. Spear’s met with Sanjay Hinduja earlier this year who spoke of the family’s association with the building.
‘We have invested all our passion and time into this project,’ says Hinduja. ‘We wanted to create a legacy in London. That was the dream of my father and his brothers — to leave a legacy behind.’
The next year will see more notable launches including The Whiteley (with branded residences by Six Senses), Park Hyatt at Nine Elms set for completion.
Westminster planning restrictions come into force
New Westminster planning restrictions, adopted in 2021 as part of the borough’s 2019-2040 ‘City Plan’, came into force this year. These restrictions mean that no new residences can be greater than 200 square metres in size, ‘except where it is necessary to protect a heritage asset’.
For properties that managed to gain approval before the edict was revealed, a new breed of residence has emerged: a limited-edition apartment - one that is located in Westminster and is generously proportioned.
This includes The Whiteley by Finchatton (set to open in the coming months) and the £450 million redevelopment of St John’s Wood Barracks, which gained planning consent in 2015, and is slated for completion in 2028.
One particular standout is the townhouse at The Bryanston by Marble Arch. Spanning over 14,000 square feet of accommodation with a 4,000 square foot garden, the townhouse (alongside several other apartments within the building) are some of the last new properties on the fringes of Hyde Park to offer luxury on such a large scale.
After the scheme received the 2023 Spear’s Award for Super-Prime Development of the Year, Spear’s met with Lottie Geaves, sales director at Almacantar (developer of The Bryanston). She explains that the residences at The Bryanston have become trophy assets, especially given the new planning restrictions. ‘These are truly one-of-a-kind apartments, in terms of their size, location and the views,’ says Geaves.
Thomas Van Straubenzee is named 2023 Property Adviser of the Year
At the 2023 Spear’s Awards, Thomas Van Straubenzee of Knight Frank, was recognised as the Property Adviser of the Year.
In a category with stiff competition — the likes of Roarie Scarisbrick of Property Vision and Marcus O’Brien of UK Sotheby’s International Realty — Straubenzee was commended by our judging panel for the advice and solutions he provides his clients.
‘He has a phenomenal soft-spoken gravitas and is unflappable around very HNW clients,’ one judge remarked. Another judge praised the discretion afforded to Straubenzee’s clients. ‘He has an aversion to social media and hates publicity. That buys him immense loyalty and in spite of zero publicity, he’s the best person in our industry.’
Prime property surges in Dubai
Is there a city that has become as synonymous with luxury as Dubai? As HNWs flock to the city, property prices soared across 2023.
A report by Knight Frank earlier this year examining prime property sales in global markets showed that Dubai had seen the greatest rise in the number of super-prime homes sold in Q2 2023 compared to Q2 2022.
[See also: Desert Dream: The story behind Dubai's prime property surge]
As the UAE continues to attract HNW buyers and investors, 2024 is looking equally optimistic. Andrew Cummings, head of prime residential for Knight Frank in Dubai tells Spear’s that the city is now a mature investment market.
‘People always talk about no income tax when they talk of Dubai, but in some ways that financial motive is a bit outdated,’ says Cummings. ‘It’s the overall lifestyle here that is the real draw these days. Dubai has the best security, schools, transport, medical care, restaurants, hotels – and most of the year the best weather.’
