The seriously rich love penthouses. One Russian billionaire loves them so much he recently set a world record when forking out over R3bn for a penthouse in Monaco. Price-wise that makes South Africa’s best offerings appear positively puny. Stephen Pellerade works and lives in the rarified atmosphere of the super wealthy, building and selling properties in the R50m upwards range. He has kindly agreed to share his world with us. Here’s his first contribution, taking a look at the penthouse markets. Â – AH
By Stephen Pellerade*
Why the rise and rise of penthouse prices ?
Several weeks after an apartment at One Hyde Park in London sold for $220m, which made it the world’s most expensive penthouse, the record was spectacularly shattered by the sale of the La Belle Epoque penthouse in Monte Carlo at $308m. This 1625m2 duplex home in the sky also features a double-volumed library, outside gardens with 4.5m high trees, a sumptuous spa, and a fully equipped media centre.
On a recent trip to Hong Kong I visited one of the astoundingly beautiful penthouse apartments in Frank Gehry’s Opus building. Situated like an object of art on The Peak, it features balconies designed like boat decks taking in views of, well, everywhere. My well-heeled and fabulously rich host informed me that one of the penthouses sold late last year for HKD$ 455 million; making this a record price in that region.
And it appears the same trend is happening in South Africa. We were all astounded by the R110m achieved on the sale of one of the penthouses at the One And Only V&A Waterfront in 2008; and there is a plethora of new penthouses with fabulous pricetags emerging. So this begs the questions; “why” the demand, as well as “how” are these huge prices determined ?
Penthouses in superb locations rank as the ultimate “must haves” for the world’s super rich. It’s kind of like having the Bugatti Veyron sportscar also parked in your 12 car super-garage. Like Monte Carlo, space on the Atlantic Seaboard is minimal and Clifton ranks as one of the world’s finest spots to live. Little wonder that Dogon Group are currently marketing a R100m plus duplex penthouse in Clifton’s most prestigious apartment block. On 800m2 of marbled luxury this equates to R 220,000 per m2; which also includes 200m sq of outside terraces and swimming pool, multiple garaging, and a private lift. Dogon also recently sold a 700m2 penthouse at Pinmore at the V&A Waterfont for R52m, or R 75 000 per m2.
Not to be outdone, the regionally wealthy business hub of Johannesburg boasts some superb new penthouses. At the Regent in Sandton a triple storey 4 bedroomed place is going for R 60m, or R 102 000 per m2. In Sandhurst, another triple storey penthouse which boasts the largest rooftop garden in the country, is on the market at R 39m, or R 52 000 per m2. Located on the prestigious Houghton golf course, penthouses at The Houghton are achieving in excess of R 56 000 per m2.
You may be wondering why there is such disparity in the prices per square meter. The simple answer is that it is due to “location” as well as what I refer to as the “extravagant necessities”. If you are overlooking Hyde Park in London, Victoria Harbour in Hong Kong, or hanging over Clifton Fourth beach; you will fetch premium prices. Particularly if yours is the “jewel in the crown” in an apartment block. And if the said block was designed by an internationally acclaimed architect or designer, this will add more square meterage dollars.
Then of course we must look at what the particular penthouses offer. Private lifts are hugely popular, as well as separate secure basement parking. Home spas, gymnasiums and private cinemas are the norm. As well as butler suites, wine cellars and home automation. The size and quality of terraces, swimming pools, and gazebos also add to the tag.
In terms of décor and furnishings, work on 15% of the penthouse cost. Atypically the top of the range penthouses are marketed as fully decorated and furnished by leading interior designers. Usually to a standard befitting trophy homes; they showcase the best of fabrics, wall coverings, furniture labels and objects. Of course it’s not an easy task transporting baby grand pianos, 5 meter paintings and 2 ton sculptures to the top floor. Think hefty crane hire and insurance charges.
Despite what superlative prices they’re marketed at, not all penthouses achieve these. I would be surprised if The Regent penthouse achieves the asking price; great building, average location and a disappointing outside entertainment area in my opinion. Better value for me would be the main penthouse at Sandhurst Towers; principally due to it’s location in the heart of the Sandton CBD, as well as the extravagant roof-top garden. Less concrete city, and more greenery is the relaxed lifestyle afforded at The Houghton. At a recent soiree held at one of the newly completed penthouses there; I was mesmerized at both the views of the rolling golf course lawns and ponds, as well as the distant views over the trees toward the glittering skyline of the Sandton metropolis.
*Stephen Pellerade, is the CEO of Pellerade architecture and design house
