Sheikh’s salute puts London’s Mr Super Prime on the map

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• Daniel Daggers says luxury London property booming
• Clients such as Emirates CEO helped him build reputation in Gulf
• Homes over £10m remain resilient in times of economic uncertainty

Business is booming for London-based luxury property broker Daniel Daggers, founder of DDRE Global, thanks in part to clients such as the chairman of Dubai airline Emirates.

When Sheikh Ahmed Bin Saeed Al Maktoum was looking to purchase in the UK capital, his adviser turned to DDRE’s Daggers for help.

And the real estate mogul is the first to admit that the subsequent testimonial from the uncle of Dubai ruler Sheikh Mohammed bin Rashid Al Maktoum has been instrumental in growing a healthy roster of high net worth individuals from the Middle East looking for London homes priced in the £10-20 million ($12.37-24.75 million) category, known as super prime.

“Having Sheikh Ahmed openly recommend me and my business carries significant trust and credibility not only in the region but across the globe,” Daggers told AGBI.

“I’m not another real estate agent from the west looking to profit from the Middle East, but a trusted advisor who appreciates the responsibility of such a recommendation.”

Regional clients now hail from the UAE, Qatar, Saudi Arabia, Egypt, Bahrain, Kuwait, Yemen and Israel, and DDRE is seeing more Middle Eastern investors looking for residential assets that represent a strong yield. 

“This isn’t just about making money, but instead more about wealth preservation and hedging exposure in certain currencies and asset classes,” said Daggers.

“As certain global markets weaken, London has been stable in comparison.”

His comments follow research from real estate consultancy firm Knight Frank that indicated the super and ultra prime (over £25 million) markets have remained resilient in the face of rising interest rates and economic uncertainty.

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Activity at the top end of residential markets remained elevated from pre-pandemic levels in 2022 after a record-breaking 2021.

Globally, 1,392 sales were transacted at or above $10 million across 10 global markets last year.

While this represents a decline compared with the record-breaking 2,076 transactions recorded in 2021, it is still 49 percent above 2019 levels and equates to $26.3 billion in sales.

Only New York and Los Angeles were more active in the super prime market than London, which registered 223 sales.

As with many market segments, the second half of 2022 saw a slowdown in transactions as the cost of debt rose and talk of recession began to enter the daily vocabulary.

However, the decline was moderate, with 44 percent of transactions happening in the final six months.

For ultra prime sales - those priced at $25 million and above - the UK capital shared the top spot with New York with 43 deals, the highest level since 2014.

Prices in prime areas of London fell 1.3 percent quarter-on-quarter in the final three months of last year, but they were sill up 1.5 percent year-on-year and 3.9 percent above those pre-pandemic levels, agents Savills said its latest report.

Prime properties are defined as being worth £1 million or above.

This still lags well behind Dubai’s booming real estate sector, where Knight Frank said luxury residential prices rose 44.2 percent year-on-year in 2022. The emirate took the top spot on its global list of price increases, with London 75th.

However, Savills reported that the return of international buyers meant super prime areas such as Belgravia, Knightsbridge, Mayfair and St John’s Wood have been among “the most robust” in the fourth quarter of last year, with prices down by just 0.6 percent quarter-on-quarter in prime central London areas.

The influx of oil-based wealth into London began in the early 1970s when Saudis started to buy property in and around Mayfair.

Other high-profile clients of DDRE Global, which has completed deals worth more than £450 million since its inception in 2020, include Emad Khashoggi, the Lebanon-born founder of luxury real estate developer Cogemad; former Dragons Den star Tej Lalvani, the CEO of the UK's largest vitamin company Vitabiotics; and Edward Misrahi, founding partner of Ronit Capital, an emerging markets oriented hedge fund. 

Daggers said that while sterling remains relatively weak, it is a “good time to invest” in London. 

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“Our Middle Eastern clients look to London as a traditional place to invest," he said.

"In many instances this is born out of heritage, as their grandfathers once invested here.

"Now the prices are slightly different, but their interest remains true through the generations and Mayfair, Knightsbridge and Belgravia remain a focal point."

While investment sizes tend to be in the region of £10-20 million from Middle East clients, Daggers said that they “have not looked for debt financing”.

“As the younger principal of the family takes more of an interest, debt in different neighbourhoods for investment are now possibilities,” he added. 

Daggers, who has picked up the nickname of Mr Super Prime after more than a decade in the sector, said prospects in London remain strong.

“There will be more opportunity to acquire good value real estate in London as we see the global market lose confidence, and some sellers may now have the need to sell," he said.

“However, as we saw during the global financial crises of 2008-9, London was far less effected than many other super cities.

"The lack of inventory, new development and the continued desire from the ultra high net worth individuals to either have a primary or secondary residence in London will continue to support property values.”

According to Daggers, there is “no other place in Europe that can truly compete with London”, with the education system, culture, internal infrastructure and global connectivity continuing to attract some of the world’s wealthiest people to invest in real estate.