London...attracts world's super-rich

[SSLL]

From: http://www.theaustralian.news.com.au/story/0,20867,20817586-2703,00.html
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London attracts world's super-rich
Helen Nugent, London
November 25, 2006
LONDON has become the world's most appealing refuge for the super-rich, according to research that shows that no other capital city can rival it for attracting billionaires from elsewhere.
Other large cities, such as New York, Moscow and San Francisco, may compete with London for resident billionaires, but their elite are homegrown.

Of the 23 billionaires in London, only 12 are British. The rest come from countries as varied as India, Iceland and South Africa.

New York is home to 34 of the mega-rich, who are mostly American. Trailing behind are Moscow and San Francisco, with 20 billionaires each.

Forbes, the magazine for the rich and powerful, believes that London's appeal lies in its accessibility, stability and low taxation and the global standing of City institutions.

Forbes.com's Paul Maidment said: "Many cities vie for the title of the world's capital, but London still attracts the elite of the world's rich and successful. And it can lay claim unchallenged to one title: it is the magnet for the world's billionaires."

At the top of the London list is Lakshmi Mittal, the world's fifth-richest person, according to Forbes's league table of the global elite. The Indian steel mogul has an estimated $US23.5billion ($30.3billion) at his disposal. He is ahead of Roman Abramovich, the Russian owner of Chelsea Football Club, who is the world's 11th-richest person, with a fortune estimated at $US18.2billion.

In third place are Leonard Blavatnik, the Russian-American oil magnate, and Charlene de Carvalho-Heineken, a Dutch heiress to the Heineken beer fortune.

Only then does the first British billionaire make an appearance; David Reuben, who - with his brother Simon, who lives elsewhere - has a net worth of $US3.6 billion. They rank 185th on the list. Both were raised in Britain, but born in Bombay.

Mr Maidment said: "Billionaires are, by nature, a peripatetic lot. They can afford to own property on many continents, and do. Their business interests and their investments are global.

"Their money travels the world as much as they do. On any day of the year, they are as likely to be in London or New York or Shanghai or Monaco. In a sense, they are citizens of no country but the self-contained universe of the super wealthy. Yet they do have to have the occasional points of contact with the rest of the world. London offers them a welcoming ecosystem."

Other billionaire expats in the capital are Philippe Foriel-Destezet, the Frenchman who founded the Adecco temp agency, and South African property developer Donald Gordon.

Also in London is Iceland's first billionaire, Bjorgolfur Thor Bjorgolfsson.

"Low taxation is a big attraction. It is not stretching a point too far to say that for the super-rich, London is a tax haven," Mr Maidment said. "The UK's tax laws contain provisions that enable non-British-born individuals who live in London for some but not all the time to be taxed only on their UK earnings."

London was not just a good place to do business, Mr Maidment said. It also boasted a luxury industry designed to cater for every whim of the wealthy.

"There are elegant shops, luxurious private clubs and good schools for the children, all expensive enough to keep the riff-raff at bay," he said.

[Xing]

LONDON has become the world's most appealing refuge for the super-rich,

From what?

[scribeman]

From what?
I suppose, like... New York City or something.
I can definitely understand why the ultra-rich would choose London. All, what, twelve of them? :rolleyes:
I suppose the lifestyle is there, although frankly I'm shocked at the idea of England being "tax friendly". I'll need to see some hardcore evidence before I buy into that. In general, the quality of private education, access to cultural goods, "small-town" feel of its generally suburban character, and centuries upon centuries of institutions designed to cater to the every whim of the privileged does make London an appealing sell.

[Buckeye Native 001]

OH MY GOD! A big city has rich people? Get the hell outta here! :hyper:

[scribeman]

OH MY GOD! A big city has rich people? Get the hell outta here! :hyper:
There was a figure sometime back that reported that London was even more expensive than NYC per square foot of luxury real estate, or some such figure.

Just look at Chicago. It's a "big city", but it's unquestionably more working-class than it is "rich". Dallas, Houston... Probably some rich people, but for all that they're big cities you don't associate wealthy with them. I don't think you can write it off that easily.

[Buckeye Native 001]

Just look at Chicago. It's a "big city", but it's unquestionably more working-class than it is "rich". Dallas, Houston... Probably some rich people, but for all that they're big cities you don't associate wealthy with them. I don't think you can write it off that easily.

This may be more of an opinion than the presentation of actual facts, but I disagree. I also think the Chicago lakefront and many of the northside neighborhoods, as well as many sections Dallas and Houston, would also disagree.

[scribeman]

This may be more of an opinion than the presentation of actual facts, but I disagree. I also think the Chicago lakefront and many of the northside neighborhoods, as well as many sections Dallas and Houston, would also disagree.
Yes, but I'm not denying that they have wealth. Even Little Rock, Arkansas has "rich" neighborhoods. But they are not rich cities, in terms of attracting the affluent with the promise of a lifestyle that accomodates their wealth.

So I think that's the point of the article. And why you can't simply write off big cities having wealthy citizens, because that wasn't the focus of the initial argument. Even New York City can't offer what London is now offering, apparently.

(I've made it clear that I don't like either city, so no one can accuse me of favoritism.)

[Marcu]

Just look at Chicago. It's a "big city", but it's unquestionably more working-class than it is "rich". Dallas, Houston... Probably some rich people, but for all that they're big cities you don't associate wealthy with them. I don't think you can write it off that easily.


Cook county (Chicago+some of the burbs) has the 2nd most millionaires in the country after LA county. Your statement is based more on inaccurate stereotypes and exagerations. Chicago is "working class" just as Dallas is still the "wild west".

[alex1]

Cook county (Chicago+some of the burbs) has the 2nd most millionaires in the country after LA county. Your statement is based more on inaccurate stereotypes and exagerations. Chicago is "working class" just as Dallas is still the "wild west".

cook is also the 2nd largest county. The next largest is Harris (Houston), with some 2 million less folks.

with numbers that skewed, of course Cook will be 2nd in the U.S. in terms of millionaires.

[Jularc]

I suppose the lifestyle is there, although frankly I'm shocked at the idea of England being "tax friendly". I'll need to see some hardcore evidence before I buy into that.


Maybe this will help you understand...


The World's Richest People: The U.K.'s Billionaires



Paul Maidment
12.07.06

There are 24 British citizens on our most recent annual list of the world's richest people. And 32 of the world's richest people list the U.K. as their place of residence.

Twenty-one appear on both lists, with the Duke of Westminister being the highest ranking home-team billionaire, ranked No. 100 overall and the fourth richest man in the U.K. after Lakshmi Mittal at No. 5, Roman Abramovich at No. 11 and Hans Rausing at No. 56.

While his day job is as assistant chief of the U.K's defense staff responsible for reservists, his fortune comes from his privately held family company, the Grosvenor Group, with £9.1 billion of real estate assets around the world under management at the turn of the year, including 300 acres of prime Mayfair and Belgravia property in central London.

The three British billionaire ex-pats are retailer Philip Green, or more exactly his wife Christina (though they count as one for the purposes of our list); Clive Calder, the South African born ex-record-label tycoon who discovered Britney Spears; and currency trader turned investor Joseph Lewis. They live in Monaco, the Cayman Islands and the Bahamas respectively.

Now here's the twist: While those three places have long had a certain tax appeal to the wealthy, many of the non-Brit billionaires based in Britain, such as Mittal, Abramovich and Rausing, are attracted to the U.K.'s own emerging reputation as a tax haven with good schools, nice homes and safe streets.

And while the foreign-born take advantage of a well-known tax provision for non-domiciled residents ("non-doms") that allows those who live in the U.K. for some but not all the time be taxed only on their U.K. earnings, it seems that the legions of financial advisers that exist in Britain's billionaire support ecosystem can make the U.K hospitable to home-grown wealth, too.

According to a newly published study by accountancy firm Grant Thornton and commissioned by the Sunday Times newspaper, U.K. billionaires paid income tax totaling £14.7m ($29.1m) on their £126 billion combined fortunes last year, and only a handful paid any capital gains tax.

Grant Thornton estimated that three in five billionaires paid no personal income taxes, although they would have paid indirect taxes such as value-added and council (local authority services) taxes. Business income would have been tucked away in offshore trusts and companies. Most of the rest who did pay taxes would have paid themselves in dividends rather than with a salary. Dividends are taxed at an effective rate of 25% rather than the 40% higher rate of income tax.

Accepting that there is a degree of guesswork in the numbers given that neither individual tax returns nor the details of more arcane tax shelters are public documents, but taking them at their face value, we estimate that Britain's billionaires paid an effective income tax rate of barely 0.4%.

We are assuming a conservative 7% rate of return on the capital. If you are a billionaire you probably have the financial nous or can afford the financial advisers to beat that.

We also allocated the combined wealth of the billionaires between the doms and non-doms in proportion to their numbers and switched Green and Formula One motor racing Chief Bernie Eccelstone to the non-dom tally. Although domiciled in the U.K, they take full tax advantage of having non-resident wives. We calculate that these adjustments cut the collective taxable fortune of true-Brit billionaires to £49 billion, throwing off £3.4 billion of annual income.

Those billionaires are clearly effective at sheltering their income from the tax man. U.K. residents and those domiciled with U.K. companies will often draw out of their companies only what they need, and they will accumulate capital at corporate tax rates with a long-term plan to realize it at a 10 % rate using the U.K's business-taper rules. The rules progressively reduce capital gains taxes on long-held assets, or during a five-year period overseas, which might be an option for a peripatetic billionaire such as Sir Richard Branson, the Virgin Group entrepreneur with a zest for business matched only by his flair for self-promotion and love of globetrotting. How high does a balloon have to be before the tax man counts it as being out of the country?

The Inland Revenue forgoes a nominal billion pounds in income tax on the basis of our interpretation of Grant Thornton's figures, Critics of the U.K.'s tax regime point to this and to the social cost of rising house prices, especially in London and the southeast of England, and of widening wealth disparities, to argue that the tax regime should change. But as Mike Warburton, the Grant Thornton partner in London involved in compiling the survey, points out, "There is no need for many of these individuals to stay here. Even if we changed the rules, their offshore structures are already in place so very little additional tax would be collected."

Offset against that the value-added tax receipts on the goods and services those billions of pounds of capital imported tax free are spent on and corporate taxes, which Warbuton says, "will be considerable in some cases" plus the taxes paid and jobs created within the support system, from bankers to gardeners. This all adds up to sufficient income, it must be assumed, to keep Britain's officials minded not to change the rules.


© 2006 Forbes.com LLC™ ("http://www.forbes.com/entrepreneurs/2006/12/07/britain-billionaires-mittal-ent_cx_pm_1207ukbillies.html)

[PhillyRising]

They move to London because it's Absoluetly Fabulous.....Sweetie Darling.

[PDXPaul]

If I were a billionaire, I'd live in London. But mostly for the beautiful seattlelike drizzly weather in a city that's just a tad bit bigger than Seattle:)

[Master Shake]

Every large city is more working class than rich, just a fact of the numbers.

While Chicago is always referred to as a working class city, that is an outdated description of the city. Its definately an upper middle class city. Personally, I always feel that New York has more a working class feel than Chicago. Trump and his ilk are definately a minority in New York.

[Jularc]

They move to London because it's Absoluetly Fabulous.....Sweetie Darling.

http://www.uktv.co.uk/images/standardItem/L1/528040_L1.jpg

[staff]

What's the news?
London is the natural place to go for pretty much anyone in Europe, no matter what you're looking for (or what you have - say a couple of billion €).

[London999]

If I were a billionaire, I'd live in London. But mostly for the beautiful seattlelike drizzly weather in a city that's just a tad bit bigger than Seattle:)

London is a lot drier than Seattle

[scribeman]

Cook county (Chicago+some of the burbs) has the 2nd most millionaires in the country after LA county. Your statement is based more on inaccurate stereotypes and exagerations. Chicago is "working class" just as Dallas is still the "wild west".

I can't get the damnable link buttons to work, so you'll have to suffer large link addies.

According to the 2004 figures located here:
http://money.cnn.com/2005/08/30/pf/city_county_rankings/index.htm
Chicago isn't in the top ten wealthiest cities or counties in America.

http://www.forbes.com/lifestyle/2005/10/27/richest-cities-US-cx_sc_1028home_ls.html
This article from last year doesn't place Chicago, either. California apparently still sits at 40% ownership of the wealthiest counties in the top ten.
http://en.wikipedia.org/wiki/Highest-income_counties_in_the_United_States
And here are the 2000 Census figures. The highest county in Illinois to make the list is Lake. At 31st.
Even if Cooke County has the most millionaires, it still isn't the wealthiest.

My point was not to knock Chicago down a few pegs, but to point out that Chicago (and by extension, most cities in America) do not have the kind of lifestyle the super wealthy want to live. The culture of most cities is either working class or genericly business-oriented, with the exceptions being highly notable. No matter how big, they still do not attract the super wealthy.

I'd be interested in an analysis of local weather in relation to population of wealthy citizens... and I'll read the big post about London's tax-friendliness later.

[WesTheAngelino]

Who really gives a flying fuck? As if having more billionaires actually matters for the other milliions of residents of a large metro.

[LA21st]

[QUOTE=scribeman;2499493]I can't get the damnable link buttons to work, so you'll have to suffer large link addies.

According to the 2004 figures located here:
http://money.cnn.com/2005/08/30/pf/city_county_rankings/index.htm
Chicago isn't in the top ten wealthiest cities or counties in America.

http://www.forbes.com/lifestyle/2005/10/27/richest-cities-US-cx_sc_1028home_ls.html
This article from last year doesn't place Chicago, either. California apparently still sits at 40% ownership of the wealthiest counties in the top ten.
http://en.wikipedia.org/wiki/Highest-income_counties_in_the_United_States
And here are the 2000 Census figures. The highest county in Illinois to make the list is Lake. At 31st.
Even if Cooke County has the most millionaires, it still isn't the wealthiest.

My point was not to knock Chicago down a few pegs, but to point out that Chicago (and by extension, most cities in America) do not have the kind of lifestyle the super wealthy want to live. The culture of most cities is either working class or genericly business-oriented, with the exceptions being highly notable. No matter how big, they still do not attract the super wealthy.

I'd be interested in an analysis of local weather in relation to population of wealthy citizens... and I'll read the big post about London's tax-friendliness later.[/QUOTE


Wealthiest counties stats are misleading. It basically means they have a large upper middle and middle class with not many poor people. Only small portions are really wealthy. Fairfax and Loundon counties are good examples of that.


Cook County is HUGE. A county of 5 million people wont show up on those lists. EVER. LA County wont with 10 million. But both of them do have the extremely wealthy enclaves inside their counties...wealthier than those counties that show up on those stupid lists. There isnt anyth

[waterloowarrior]

this thread is about where billionaires live, not people who are "just" ( ;) ) millionaires or wealthy areas. FWIW here's the Forbes list of Illinois billionaires http://www.forbes.com/static/bill2005/state_Illinois.html and here's the map for all those interested in checking out where billionaires live. http://www.forbes.com/2006/03/08/hometowns-networths-worlds-richest_06billionaires_map.html

[the urban politician]

My point was not to knock Chicago down a few pegs, but to point out that Chicago (and by extension, most cities in America) do not have the kind of lifestyle the super wealthy want to live. The culture of most cities is either working class or genericly business-oriented, with the exceptions being highly notable. No matter how big, they still do not attract the super wealthy.

^ You've got an interesting point. I guess the success or failure of the Chicago Spire in attracting investment from wealthy people around the globe should ultimately answer this question. Has Chicago come of age (in that regard, at least)? I guess we'll see...

[chicubs111]

Well billionaries arent really the most abuntdatnt around the world...so im sure chicago has a few..but they have a ton of millionaires and very wealthy people..that is something that not many cities around the world have. Plus billionaires have home all over the place so to say that london is there perferred city is kinda silly since they probaly just live somewhere different every month.

[LordMandeep]

Moscow also is attracting a lot of rich people i heard.

Wierd, a city with sooooo many problems yet has so many rich people.

[anm]

Moscow also is attracting a lot of rich people i heard.

Wierd, a city with sooooo many problems yet has so many rich people.

1. You make it sound like Moscow has many more problems comparing to other large cities which IMO is not quite true. Yes, the city along with the country undergoes rapid change, but this also presents opportunities for rich people.

2. If you do big business in Russia, you pretty much must have some presence in Moscow.

[edluva]

I'm not sure how accurate this ranking is, but it's in wiki if that counts for anything.

http://en.wikipedia.org/wiki/List_of_cities_with_the_most_billionaires

Another thing I don't understand is how a building like the spire siginifies anything about Chicago's overall lifestyle. A little boosterism if you ask me. Some cities have more billionaires than can be counted with your appendages while others don't. That's the real difference. Maybe those places with the super rich also have upscale retailers who can say they have sold products to the super rich. That and philanthropy.

[bjornson]

Ed, I wasn't sure about that list until I actually looked at the Forbes lists. The most recent list is "400 Richest Americans." For the most part, the list is correct.

The article says New York has 34 billionaires, yet the list says 45 (400 Richest Americans), London has 19 (World's Billionaires) not 23, and Moscow's is correct. San Francisco's is 20 on "World's Billionaires," but 13 on "400 Richest Americans." The latter of which is the most recent.

It's a matter of how a person wants to look at it and loads of boosterism. I try not to correct as it leads to flame wars.

[edluva]

I guess the only way to know is to get a list based on US dollars, but then there comes the problems of defining "metros". At least American cities can be ranked consistently. SF has 21 when Palo Alto and Atherton are thrown in, so it's not that off for SF.

[Marcu]

1. You make it sound like Moscow has many more problems comparing to other large cities which IMO is not quite true. Yes, the city along with the country undergoes rapid change, but this also presents opportunities for rich people.

2. If you do big business in Russia, you pretty much must have some presence in Moscow.

Almost all the wealth in Russia is concentrated in Moscow (with some notable exceptions like St. Petersburg). There are ungoing political concerns but nothing a bribe here and there can't resolve so long as you keep your mouth shut. Also, Russia will enter the WTO in the next couple of years so the economic situation in the country should continue to improve.

[boden]

You can have them. That is the reason I left Bermuda.

[the urban politician]

Another thing I don't understand is how a building like the spire siginifies anything about Chicago's overall lifestyle. A little boosterism if you ask me. Some cities have more billionaires than can be counted with your appendages while others don't. That's the real difference. Maybe those places with the super rich also have upscale retailers who can say they have sold products to the super rich. That and philanthropy.

^ Well, I wasn't really implying that the Spire should represent wealth symbolically, although I can see my statement being interpreted that way. Chicago's current highrise boom has mostly been fueled by more well-off people in the city or suburbs, and to some degree the midwest and general US.

The Chicago Spire, however, is going to be marketed heavily overseas, and units will be very pricy. This is sort of a first for the city. If wealthy people overseas buy, that could be a sign that they see the city as a place that can service the incredibly wealthy.

[SpongeG]

funny this topic should be here

i was watching that show - rich and famous or whatever it is from VH1 i think - and it was about london and its billionaires

insane houses they have there

[JEH-NYC]

Yippee London!
If I was mega-rich, I'd certainly have a nice pad there too.
I'm no rich man, but still routinely enjoy London's riches.

That said, it looks like in the rich guy count it's currently NY 34 - Lon 23, plus our mayor is worth $5 billion (or $20 billion according to the NY Sun) and London's mayor quotes Marx. ;)

This post is meant in fun -- I'm awed and in love with both these cities which are my two absolute favorites!!!!!!
:)

[muppet]

Thankyou Jeh, its nice to hear a voice of reason between the usual bloody battlelines, -tho' leave our lvely little mayor out of this, he's a demiGod and will strike thee down ;).

ps, like on the other post, can you please have Madonna back? We'll swap her for Tracy Ullmann.

[Daniel1]

I'm not sure how accurate this ranking is, but it's in wiki if that counts for anything.

http://en.wikipedia.org/wiki/List_of_cities_with_the_most_billionaires

Another thing I don't understand is how a building like the spire siginifies anything about Chicago's overall lifestyle. A little boosterism if you ask me. Some cities have more billionaires than can be counted with your appendages while others don't. That's the real difference. Maybe those places with the super rich also have upscale retailers who can say they have sold products to the super rich. That and philanthropy.

You bring up a good point with your link to wikipedia. Let's compare apples to apples here and not stereotype cities like Chicago as "working class" based on some old reruns of a TV show someone saw at 3 a.m. last night. There are 13 billionaires living in Chicago -- 19 if you include its suburbs. If 19 billionaires make London a world capital for billionaires, then 13 (or 19 or whatever) is certainly a respectable number for Chicago.

[bjornson]

^According to that list, London has 19 and Chicago has 13. No, I'm not boosting.

[toddguy]

'my city has more billionaires in it than your city! nyah nyah!!' *kicks sand at the other children playing in the sandbox*..*eyeroll*