Monaco : a promising “back-to-work”
The world’s most cosmopolitan mini-state is apparently not suffering from the general morosity on the economic scene. Rentals, often a decisive step prior to acquisitions, are doing well. According to estate-agents, “in this Principality, the population is constantly being renewed.”
Surrounded by Cap d’Ail, Beausoleil, Roquebrune-Cap-Martin and La Turbie, Monaco is home to Frenchmen, Italians, the British, as well as its own citizens, a segment of the population accounting for 21.5 % of the total 35,900 registered inhabitants. Together with other nationalities, they share this patch of land of 1,974 km2 in all harmony. Because this is what it’s all about : the Principality has made a high-quality life-style its flagship, its most important asset. While tax advantages are still appealing, it’s very pleasant to stroll around the streets, dotted with luxury boutiques, renowned hotels, good restaurants and lush gardens. In this day and age when global financial centres are still tottering, Monaco posts the highest GNP per inhabitant in the world. A figure which should be qualified, no doubt, given the 30,000 to 40,000 people from outside who contribute to it each day. Since the building of the dyke in 2003 (360 parking places, 25,000 m2 earmarked for storage, two harbour stations, public offices and commercial premises), projects for further development are in the pipeline. Such as the double Odéon tower building, boasting 49 floors. When Monaco is not reclaiming land from the sea, it falls back on building skyward. Its main sources of income are services, shops, real-estate and tourism, not forgetting VAT.
“Since the start of tax year 2012, investors have shown a new surge of confidence, very positive after months devoted to a wait-and-see policy,” says Elodie Blanc-Sardi of Miells & Partners. “The market was very active during the summer. Property in Moncaco is once again vaunted as a blue-chip value, sound and reliable over the long-term.” The five most recent transactions orchestrated by the agency ranged from 5.5 million euros - the budget required for a 3-bedroom apartment of approx. 160 m2 in good condition - to 15 million euros - bringing a 3-bedroom penthouse prolonged by a terrace of 200 m2 with a small pool. 60 % of buyers, mostly European, intend to occupy their acquisitions, 40 % are investing in long-term assets. The days of speculation are clearly long past. Half of the clientele already live in Monaco and are taking advantage of the rise in available stocks, a slight setback in prices and a kind of clean-out of the market. The lure of tax benefits exists, but does not suffice. All of Monaco’s residents appreciate its safety, cleanliness and climate, its wide array of shops and amenities, its geographic location and the added advantage of a very go-ahead international airport nearby. The only problem confronting estate-agents is that of satisfying a demanding clientele, inevitably expecting turn-key properties and top-notch appointments.
“At the moment, prices are stable and the “Golden Square” is still seeing steady demand,” say Eugenia Petrini and Luciana Lebon of La Costa Properties. “Buyers should expect to pay from 60,000 to 70,000 € per sq. metre for a prestigious property on a high floor in a residence around the famous Place du Casino. Several apartments in this price-bracket have in fact found takers this summer. East Europeans are the most active in this segment of the market.” The fourth quarter of the year sees a majority of clients for rentals, a springboard before taking the plunge of an acquisition. The common denominator here is increasing scarcity of good addresses and premium appointments. There is also demand for medium and large surface areas. All signs allowing one to expect a promising year-end, a far cry from forecasts for so-called classic property markets. People are moving to Monaco with their families. The Principality is a reassuring cocoon, a Garden of Eden dedicated to a “desirable life-style”. Large-scale projects are seeing the light of day and should enable Monaco to cater for this specific kind of demand.
Among her most recent sales, Angela Kleiber, owner of the Lorenza von Stein agency, mentions a 2-bedroom apartment of 130 m2 in Le Mirabeau, in need of renovation, opening out to a terrace de 40 m2 facing the sea, acquired by a Russian client for about 10 million euros. East Europeans have a soft spot for the “Golden Square”. With substantial budgets, they do not merely content themselves with an address in the Principality, but are also interested in acquiring or setting up a company. A top-level sportsman from Kazakhstan paid 2.8 million euros for a 2-bedroom apartment of 130 m2, up near the “Jardin Exotique”. And he’s not the only one to opt for this neighbourhood, thus reviving an old Monégasque tradition. The area still offers good value for money. Otherwise, the appearance of two highly prestigious developments is helping to pull the prices of current offerings upwards. One so-called “investor” proves the point : a Chinese client, who paid 3.5 million euros for an apartment of 110 m2, entirely restructured by a designer of international renown, in a bourgeois building. As soon as it was aquired, it was immediately rented out, with a return of around 2.3 %, a figure that should be put into perspective considering its long-term value. Generous surface areas are highly sought-after, which benefits Fontvieille, a neighbourhood rife with such apartments. Sailing enthusiasts, among others, like its village atmosphere, peacefulness and panoramic sea views. Recently, one client parted with 10.7 million euros for a 3-bedroom apartment of 200 m2 overlooking its charming harbour.
By Laetitia Rossi
