The growth in UHNW wealth, the rarity factor and new transport infrastructure are increasingly driving demand for alternative real estate and trophy assets, a new research has showed.

"The global UHNW population is forecast to grow by 22% by 2018 which will fuel demand for alternative real estate, particularly with a boost from Asia, the region where it is set to grow fastest," said Yolande Barnes, director, Savills World Research.

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The lower end of the luxury island market is also set to boom as young money buys into ultra prime property and resort on the world’s most sociable island, Bernes also said.

 

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According to the report produced by Candy & Candy, Savills World Research and Deutsche Asset & Wealth Management the purchase of a private island is, in most cases, an eco-philanthropic gesture to preserve the natural habitat of an island at risk and restrict public use.

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Such an investment is, in fact, ‘about lifestyle choice over financial return’. Furthermore, for the super rich or a Hollywood star, the qualities "remote" and "private" for this type of investments are priceless.

The report said Bermuda is the number one spot in a new list of the world’s top 20 islands for UNHWI real estate investment.
With the price of a typical four bedroom property in Bermuda now exceeding $4 million, this sought-after Atlantic region has the highest concentration of UNHWI property holdings of any island outside the US.

The list is also dominated by Caribbean islands with the Bahamas, British Virgin Islands and Antigua all featuring in the top five based on their proximity to the huge wealth-generating market of the United States. Europe’s safe haven, The Channel Islands also features in the top five where property prices have remained resilient during the global economic crisis, said the report.

 

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As small segment of the real estate market, private islands represent the ultimate trophy asset, behaving more like fine art or precious jewellery, operating quite independently of the wider property world, said the report.

"There are three main categories of buyer in today’s market," says Salman Madhi, head of Key Clients Relationship Management, Deutsche Asset & Wealth Management. "Developers looking for opportunities to create luxury resorts, wealthy conservationists working in tandem with governments to preserve wildlife havens and high-net-worth individuals who consider the urban playground to have become too accessible and lost its glamour."

 

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