The Russians on the Cote d'Azur
A love-affair that has lasted for almost a century-and-a-half. It started with Empress Alexandra Feodorovna’s fondness for the Mediterranean shores and is perpetuated by spectacular property acquisitions by members of today’s oligarchy. But that’s not all…
A new phenomenon or a return to square one ? In Moscow, it’s considered very trendy to own a holiday home on Cap d’Antibes or Cap Ferrat, in Monaco or Saint-Tropez, even in Cannes or Nice. When its price is calculated in tens of millions of euros and a view of the Mediterranean is part of the deal, the peak of trendiness has been attained. Ever younger billionaires from Russia, but also Kazakhstan, Ukraine, Poland, the Czech Republic, Hungary, Roumania and Slovakia make headlines in the real-estate business, contribute towards inflated prices and get written up in society columns. One by one, historic buildings end up in their hands. Boris Berezovski set the ball rolling in 1996 by acquiring the “Château de la Garoupe”. One of the latest transactions to date concerns “La Primavera”, probably acquired for a price in excess of 100 M €. And everyone's heard of Roman Abramovitch’s acquisition of the “Château de la Croë”, and the provisional agreement which should be signed this summer for “La Léopolda” with its sublime landscaped park on the commune of Villefranche-sur-Mer, for the record sum of 500 million dollars. The happy owner of the villa on Cap Ferrat called “La Sorrentina” can also be placed on the Russian list, as well as the owner of “Visconti”. While all these acquisitions are instant news, they are, of course, marginal ; members of the real-estate industry more often deal with a second generation, less wealthy but just as fond of beautiful properties.
“Buyers from Eastern Europe are hard to quantify. In most cases, they invest through French or foreign companies. Their market share, comparable to that of the Swiss and Scandinavians, is probably close on 1%,” says Jérôme Renaud of the lCroisette Californie agency. In the wake of the barons of raw commodities, the Riviera is now discovering a rising middle class, ready to spend from 600,000 to 1 M € for a “pied-à-terre” in town. Just like their predecessors, they give priority to prestige, security and a view of the Deep Blue Sea. They pay from 15,000 to 35,000 €/m2 on the Croisette, 10-15,000 €/m2 in residences with pools in La Californie, and don’t deny themselves the privilege of Nice’s town centre or Mont-Boron, the other sound investment in the capital of the Alpes-Maritimes. They prefer modern amenities to history and old stones. Quick to make decisions and knowledgeable about the local property market, they do not seem to suffer from fluctuations on financial marketplaces to the same extent as Anglo-Saxons. Experienced businessmen, they put their enjoyment above all else, never drop into an agency spontaneously, always preferring to operate on the basis of recommendations. “Contrary to what people think, these clients are more financially solvent and transparent than in the past,” confirms the President of the FNAIM Côte d’Azur.
According to Aurélien Monnier of the Agence du Cap d’Antibes, they do indeed buy, but also and above all, they are renting more and more frequently. Particularly keen on services, they spend three months on the Riviera and don’t hesitate to pay rents ranging from 5,000 to 20,000 € per week on their favourite cape. Here again, one should toss out preconceived ideas. “My last inventories demonstrated exemplary behaviour,” confides our specialist. The majority of prestigious residences in this part of Antibes belong to Russians, whereas the second wave of investors target more standard properties costing 2 to 6 M €. Of the top ten fortunes in Russia, six are said to have homes on Cap d’Antibes. “The only fly in the ointment is that this micro-market is confronted by a penury of top-notch residences, negotiated between 5 and 10 M €, and even more for outstanding properties. For lack of a solution, some buyers head for Cannes ; others content themselves with Sardinia or Tuscany.”
In the Festival City of Cannes, several renowned properties have in fact found favour with clients from the East. In the limelight due to the escapades of Algerian businessman Khalifa, “Bagatelle” came under the Russian flag in 2007 for a mere 22 M €. “A sum well-short of the potential offered by living space of 5,000 m2 with grounds of 18,000 m2 in the neighbourhood of La Californie,” points out Sylvain Boichut of the John Taylor agency. In the same area, “La Tropicale”, offering 1,800 m2 in grounds of 6,500 m2, shared a similar fate in exchange for 26 M €. An apartment of 220 m2 in Le Relais de la Reine, the most prestigious residence on the Croisette, sold for 6,750,000 €. The buyer was only 32 years old. “These afore-mentioned prices are, however, exceptional. The lowest “Russo-Cannois” budgets are around 3 M €, while the average transaction, for villas, lies between 4 and 8 M €,” says Sylvain Boichut.
40 year-olds work in industry or finance. Mafia-related funds find it hard to circumvent the French acquisition system, and suspicions about proper conduct appear to be unfounded. The return of a large number of Middle Eastern buyers, currently spotlighted due, in particular, to the origins of the 31.5 M € disbursed for the acquisition of the “Palais Oriental et Florentin”, has not reached the same level as that of East Europeans. Both groups applaud in unisson the massive arrival of new fashion boutiques on the Croisette over the past three years and efforts deployed in terms of amenities and services. While the Russians think in dollars, their budgets are much higher than those of Americans, who often play the role of sellers.
The most select location of all, Cap Ferrat offers luxuriant vegetation, flat grounds and magnificent views. Its less-crowded layout and improved surveillance guarantee an excellent level of security. An asset much appreciated by Russian clients. For a villa with a scenic view of the Med, they are willing to part with at least 15 M €. When one asks Arash Shams of Royal Riviera Immobilier about record sales, he remains evasive. Certain sources indicate that several hundred million euros are at stake.
“Monaco takes third place in the ratings of the Russians’ favourite destinations,” adds the manager of RRI. Muscovites have shown an interest in the Principality since 2001. Few of them apply for the status of residents. Even though they exist, tax benefits are not more important than the quality of life, the real motivation for these potential buyers. Large apartments in the “Golden Square” offering at least three bedrooms and priced from 8 to 12 M €, are the most sought-after. Great fans of sailing and often owners of yachts, they are particularly fond of Fontvieille, appreciate the amenities and set their sights, like the English, on luxury apartments. The average amount of a Russian acquisition is inversely proportionate to the percentage of Russians on the market. In other words, they represent a financial godsend for the Côte d’Azur, despite their relatively low number. Real-estate agents are beginning to learn the language and deal with foreign networks. From White Russians to members of the 21st-century oligarchy, there has been, in fact, just one small step ; a continuing love-affair which is, apparently, unlikely to be distracted by destinations such as Marbella or the Italian Riviera.
By Laetitia Rossi.
