The number of ultra-high-net-worth individuals in the Middle East is projected to increase 24.6 per cent in the next five years, according to a new report by global property consultancy Knight Frank. The region will remain the fourth-largest wealth hub in the world.
The global population of the ultra-wealthy is forecast to rise 27 per cent over the same period to almost 663,483 from 513,244 in 2019, according to the consultancy's 2021 Wealth Report.
Knight Frank defines HNWIs as those who possess a net wealth of $1 million or more (including primary residences and second homes not held as investments), while UHNWIs have a net wealth of $30m or more.
Asia is likely to see the largest rise in the number of UHNWIs with growth of 39 per cent, led by Indonesia and India, the report said. By 2025, 24 per cent of all UHNWIs will live in Asia. The region is already home to the most billionaires, accounting for 36 per cent of the global total.
Over the next five years, Africa is estimated to have the second-highest growth in UHNWIs at 33 per cent, led by Zambia (40 per cent) and South Africa (32 per cent).
Over the same period, the number of millionaires globally is set to rise by 41 per cent, the consultancy added.
“The pandemic has impacted the fortunes of many in the Middle East, and HNWIs and UHNWIs were not spared, with the total number of each decreasing by 11.3 per cent and 10.1 per cent, respectively, in 2020,” Taimur Khan, head of research at Knight Frank Middle East, said. “However, this decline was not uniform across all countries.”
In Saudi Arabia, the number of UHNWIs over this period increased by 9.6 per cent. In fact, the kingdom’s UHNWI population has grown by 227 per cent over the past five years, according to Knight Frank.
“As the region continues its various economic diversification programmes, we expect that there will continue to be significant growth in the number of HNWI, UHNWI and billionaires residing in the region,” Mr Khan added.
This was also reflected in the results of the Knight Frank Attitudes Survey conducted among private bankers and wealth advisers in the Middle East, where 67 per cent of respondents said their clients' wealth either remained the same or increased. Around 69 per cent expect their clients' total wealth to increase in 2021.
Meanwhile, 31 per cent of UHNWIs in the Middle East plan to purchase a property in 2021. This compares with 26 per cent of UHNWIs globally who are planning to buy a new home this year. The top choices for Middle East buyers are the UK, US, Turkey, Spain and the UAE, according to the Wealth Report.
While Auckland leads Knight Frank's Prime International Residential Index with price increases of 18 per cent last year, weaker economic conditions and oversupply in the GCC resulted in a decline in prime property prices in Doha (6 per cent), Dubai (5.9 per cent) and Riyadh (3.3 per cent). Prices in Abu Dhabi's prime market remained stable.
"While Dubai's prime residential market saw prices decrease by 5.9 per cent in the year to November 2020, we are beginning to see signs of a recovery in price performance in some prime sub-markets," Mr Khan said.
The Wealth Report also includes Knight Frank's City Wealth Index. London and New York ranked joint first on the index as the most important cities for UHNWIs to live, invest and do business. Paris follows in third position, while Tokyo and Hong Kong round out the top five spots.
In the wealth category, which measures the number of UHNWI and HNWI city dwellers, New York ranks first globally with 7,743 individuals. However, when looking at the number of HNWIs, London comes first with more than 870,000 millionaires, according to Knight Frank.
Despite the Covid-19 pandemic, private capital worth $232bn was invested in commercial real estate globally last year, Knight Frank said. The US ($141.7bn), Germany ($11.1bn) and the UK ($10.6bn) were the top three countries for private capital real estate investments in 2020.
Around 23 per cent of UHNWIs in the Middle East plan to invest in commercial real estate assets in 2021. Logistics, residential, healthcare and data centres are set to generate the most interest, it added.
We see Middle Eastern demand for prime London homes continuing in future years
London saw the highest level of cross-border private capital ($4bn) invested in commercial real estate over the 12 months to September 2020. The city also claimed the top spot for the largest number of homes considered “prime” within a city, with more than 68,000 homes worth £2m ($2.8m) or more. Dubai ranked second (42,356 homes) and Sydney (27,436 homes) was in third place.
“Given the established appeal of London as a cultural and business hub, ease of language, attractive educational system and weaker pound in recent years, we see Middle Eastern demand for prime London homes continuing in future years,” Henry Faun, partner with Knight Frank private office in the Middle East, said.
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ETFs explained
Exhchange traded funds are bought and sold like shares, but operate as index-tracking funds, passively following their chosen indices, such as the S&P 500, FTSE 100 and the FTSE All World, plus a vast range of smaller exchanges and commodities, such as gold, silver, copper sugar, coffee and oil.
ETFs have zero upfront fees and annual charges as low as 0.07 per cent a year, which means you get to keep more of your returns, as actively managed funds can charge as much as 1.5 per cent a year.
There are thousands to choose from, with the five biggest providers BlackRock’s iShares range, Vanguard, State Street Global Advisors SPDR ETFs, Deutsche Bank AWM X-trackers and Invesco PowerShares.
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Favourite author: Malcom Gladwell
Favourite travel destination: "Antigua in the Caribbean because I have emotional attachment to it. It is where I got married."
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Five famous companies founded by teens
There are numerous success stories of teen businesses that were created in college dorm rooms and other modest circumstances. Below are some of the most recognisable names in the industry:
- Facebook: Mark Zuckerberg and his friends started Facebook when he was a 19-year-old Harvard undergraduate.
- Dell: When Michael Dell was an undergraduate student at Texas University in 1984, he started upgrading computers for profit. He starting working full-time on his business when he was 19. Eventually, his company became the Dell Computer Corporation and then Dell Inc.
- Subway: Fred DeLuca opened the first Subway restaurant when he was 17. In 1965, Mr DeLuca needed extra money for college, so he decided to open his own business. Peter Buck, a family friend, lent him $1,000 and together, they opened Pete’s Super Submarines. A few years later, the company was rebranded and called Subway.
- Mashable: In 2005, Pete Cashmore created Mashable in Scotland when he was a teenager. The site was then a technology blog. Over the next few decades, Mr Cashmore has turned Mashable into a global media company.
- Oculus VR: Palmer Luckey founded Oculus VR in June 2012, when he was 19. In August that year, Oculus launched its Kickstarter campaign and raised more than $1 million in three days. Facebook bought Oculus for $2 billion two years later.
10 tips for entry-level job seekers
- Have an up-to-date, professional LinkedIn profile. If you don’t have a LinkedIn account, set one up today. Avoid poor-quality profile pictures with distracting backgrounds. Include a professional summary and begin to grow your network.
- Keep track of the job trends in your sector through the news. Apply for job alerts at your dream organisations and the types of jobs you want – LinkedIn uses AI to share similar relevant jobs based on your selections.
- Double check that you’ve highlighted relevant skills on your resume and LinkedIn profile.
- For most entry-level jobs, your resume will first be filtered by an applicant tracking system for keywords. Look closely at the description of the job you are applying for and mirror the language as much as possible (while being honest and accurate about your skills and experience).
- Keep your CV professional and in a simple format – make sure you tailor your cover letter and application to the company and role.
- Go online and look for details on job specifications for your target position. Make a list of skills required and set yourself some learning goals to tick off all the necessary skills one by one.
- Don’t be afraid to reach outside your immediate friends and family to other acquaintances and let them know you are looking for new opportunities.
- Make sure you’ve set your LinkedIn profile to signal that you are “open to opportunities”. Also be sure to use LinkedIn to search for people who are still actively hiring by searching for those that have the headline “I’m hiring” or “We’re hiring” in their profile.
- Prepare for online interviews using mock interview tools. Even before landing interviews, it can be useful to start practising.
- Be professional and patient. Always be professional with whoever you are interacting with throughout your search process, this will be remembered. You need to be patient, dedicated and not give up on your search. Candidates need to make sure they are following up appropriately for roles they have applied.
Arda Atalay, head of Mena private sector at LinkedIn Talent Solutions, Rudy Bier, managing partner of Kinetic Business Solutions and Ben Kinerman Daltrey, co-founder of KinFitz
Top tips
Create and maintain a strong bond between yourself and your child, through sensitivity, responsiveness, touch, talk and play. “The bond you have with your kids is the blueprint for the relationships they will have later on in life,” says Dr Sarah Rasmi, a psychologist.
Set a good example. Practise what you preach, so if you want to raise kind children, they need to see you being kind and hear you explaining to them what kindness is. So, “narrate your behaviour”.
Praise the positive rather than focusing on the negative. Catch them when they’re being good and acknowledge it.
Show empathy towards your child’s needs as well as your own. Take care of yourself so that you can be calm, loving and respectful, rather than angry and frustrated.
Be open to communication, goal-setting and problem-solving, says Dr Thoraiya Kanafani. “It is important to recognise that there is a fine line between positive parenting and becoming parents who overanalyse their children and provide more emotional context than what is in the child’s emotional development to understand.”
Company profile
Date started: 2015
Founder: John Tsioris and Ioanna Angelidaki
Based: Dubai
Sector: Online grocery delivery
Staff: 200
Funding: Undisclosed, but investors include the Jabbar Internet Group and Venture Friends
UAE currency: the story behind the money in your pockets
If you go
Flight connections to Ulaanbaatar are available through a variety of hubs, including Seoul and Beijing, with airlines including Mongolian Airlines and Korean Air. While some nationalities, such as Americans, don’t need a tourist visa for Mongolia, others, including UAE citizens, can obtain a visa on arrival, while others including UK citizens, need to obtain a visa in advance. Contact the Mongolian Embassy in the UAE for more information.
Nomadic Road offers expedition-style trips to Mongolia in January and August, and other destinations during most other months. Its nine-day August 2020 Mongolia trip will cost from $5,250 per person based on two sharing, including airport transfers, two nights’ hotel accommodation in Ulaanbaatar, vehicle rental, fuel, third party vehicle liability insurance, the services of a guide and support team, accommodation, food and entrance fees; nomadicroad.com
A fully guided three-day, two-night itinerary at Three Camel Lodge costs from $2,420 per person based on two sharing, including airport transfers, accommodation, meals and excursions including the Yol Valley and Flaming Cliffs. A return internal flight from Ulaanbaatar to Dalanzadgad costs $300 per person and the flight takes 90 minutes each way; threecamellodge.com
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants
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Tips to stay safe during hot weather
- Stay hydrated: Drink plenty of fluids, especially water. Avoid alcohol and caffeine, which can increase dehydration.
- Seek cool environments: Use air conditioning, fans, or visit community spaces with climate control.
- Limit outdoor activities: Avoid strenuous activity during peak heat. If outside, seek shade and wear a wide-brimmed hat.
- Dress appropriately: Wear lightweight, loose and light-coloured clothing to facilitate heat loss.
- Check on vulnerable people: Regularly check in on elderly neighbours, young children and those with health conditions.
- Home adaptations: Use blinds or curtains to block sunlight, avoid using ovens or stoves, and ventilate living spaces during cooler hours.
- Recognise heat illness: Learn the signs of heat exhaustion and heat stroke (dizziness, confusion, rapid pulse, nausea), and seek medical attention if symptoms occur.
Tips for job-seekers
- Do not submit your application through the Easy Apply button on LinkedIn. Employers receive between 600 and 800 replies for each job advert on the platform. If you are the right fit for a job, connect to a relevant person in the company on LinkedIn and send them a direct message.
- Make sure you are an exact fit for the job advertised. If you are an HR manager with five years’ experience in retail and the job requires a similar candidate with five years’ experience in consumer, you should apply. But if you have no experience in HR, do not apply for the job.
David Mackenzie, founder of recruitment agency Mackenzie Jones Middle East
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The 100 Best Novels in Translation
Boyd Tonkin, Galileo Press