Michael Belton, chief executive of property development company Mered, grows his wealth by spotting attractive opportunities in real estate and investing in them early on.
The American, 55, who was born and raised in Alaska, worked in Russia for more than 20 years and has been in the UAE for six months now.
He graduated from the University of Massachusetts in arts and political science and went to Russia on a foreign exchange programme and “fell in love with everything there”.
Mr Belton started working for Hines, America's largest property development company, in 1993, and was with them for eight years in Russia. He started as a leasing consultant and ended as the head of development after 10 years.
He also had a short stint in Saudi Arabia, where he worked for the giga project Qiddiya as head of development for one of their business units.
“The parent company of Mered is headquartered in Russia and has been involved in real estate development for 25 years, predominantly in residential real estate, and built more than three million square metres of space,” he says.
“They saw the market in Dubai as one where they could add value with their expertise. They are a master developer like Aldar and Emaar and have the capabilities and cash flow to expand in a new market.”
Mered is currently developing three properties, one in Dubai and two in Abu Dhabi, with a total sales value of $1.4 billion.
“Since my arrival in October as chief executive of Mered, we have sold $120 million worth of apartments in Dubai,” says Mr Belton, who lives in Dubai’s Bluewaters Island with his wife and a daughter.
Did wealth feature in your childhood? What did you learn from it?
I grew up in a middle-class American family with hard-working parents. We had enough for the essentials. I admired my wealthy New York relatives and learnt that dressing smartly could positively influence people's impression of me. I learnt the value of money and education by seeing them and going out with them.
How did you first earn? What did your first job pay?
Like most Americans, my first job was when I was 12, delivering newspapers. My first professional job was with Hines in Moscow, earning $1,500 a month.
Did you face any early financial jolts?
No, I'm a very curious person, so the harder I worked, the more responsibilities I was given and the more I was able to earn. I've received consistent salary increases through promotions due to hard work.
There are always cycles in the real estate market, but I've somehow been shielded from many of them.
How do you grow your wealth?
As we are in the business of residential real estate, we understand where the market is headed. So, I'm able to buy in early at a good price to get attractive investments that I take advantage of. I hire financial managers to reinvest those profits.
Real estate development is a more high-risk profile, but that's why the returns are usually 30 per cent to 40 per cent on my investment.
I also have a very wide investment portfolio, which is preserved more for growth and not for quick returns. My financial managers aim to offer me 6 per cent to 8 per cent returns, so it’s a very different risk profile, and it's something that is more generational for me as an investment.
Are you a spender or a saver?
I am neither, instead, I am an earner. I'm more focused and interested in finding ways to earn money. I reinvest earnings in short-term, mid-term and retirement vehicles.
As far as saving, I try to save money every month and invest it. I'm not a shopper.
Have you been wise with money?
I believe so. You make some mistakes, you make some good choices. But overall, when I see what I started with and where I am now, what I'm able to pass on to my children, I would say, it’s been pretty good.
What has been your best investment?
Investing in myself and my business, specifically purchasing properties I develop. I founded my own business in 2007 called Storm Properties and sold it to one of the largest home builders in Europe in 2008. The majority of my wealth is created due to the sale of that company.
chief executive, Mered
Any cherished purchases?
No. I value people and experiences over physical possessions like cars or jewellery.
I'm not attached to houses, apartments or cars. I have many of them, but when I sell them, I don't have much attachment to them.
How do you feel about money?
It's an important tool to provide comfort to my family and me, especially in later years. The more money you make is not equivalent to how happy you are as a person. Many people have lots of money and are miserable, and some people have no money and they're happy.
Any financial advice for your younger self?
Start investing in residential properties earlier. I wish I had bought my first property when I was 25 years old. Many of them cost $50,000 then and five years later, they were worth around $500,000 to $600,000.
Also, maximise pension contributions to take advantage of tax-deferred retirement products. I always maximised my 401(k). By putting in maybe $300 to $400 a month when you are younger, you don't notice the money going out. But after doing it for 25 years, there's millions of dollars in my pension fund because of that.
What luxuries are important to you?
Flying business class, staying in five-star hotels and enjoying dinners with friends without budget limits. It's not necessarily to go out and buy a new Patek Philippe watch or a new Lamborghini, but I derive pleasure out of these comforts for me, my family and friends.
Any key financial milestones?
Becoming a millionaire by age 35.
What are your financial goals?
I'm 55 years old and fairly wealthy. My goal is to continue to grow my family's income to pass on to the next generation. I don't have a goal to become a billionaire. It's not my thing. Financially, I've hit all the goals that I set for myself. Right now, I’m at the age where legacy is more important for me.
I'm a real estate developer, so I want to build beautiful projects, which will stand for many years after I'll be gone. I enjoy taking my children around to see a project when the foundation is being poured, and then, when the building's up, they come back five years later and say: “Wow, my dad built that.” That's my goal. It's not financial anymore.
I also own three properties. I plan to maintain two to four properties, buying and selling as market conditions allow. I aim to own a property at a ski resort in Switzerland or Montana.
