How The World’s Most Expensive Apartment Building Became A Lightning Rod For How We Feel About The Super Rich
Next week marks 10 years since London’s One Hyde Park was completed and the keys to its luxury apartments were handed over to residents who came from all corners of the globe, but who now shared at least two things: They were incredibly rich, and they had bought one of the most expensive homes on the planet.
One Hyde Park’s story is a classic real estate development tale of ambition, vision, nerve, a bit of cheek and a hefty slice of luck. It made a lot of people in London property who had nothing to do with it a lot of money simply through the gravitational pull that it exerted.
But One Hyde Park has a meaning and resonance that go beyond the property sector, in a way that very few buildings do. It says something about London in the 21st century, its place in the UK and in the world, the global distribution of wealth and how we feel about the very rich in our society. So it is also a story about elites, inequality, snobbery and international politics. Few buildings in recent years have created a reaction so visceral — to the point where its architect didn’t want to work in the UK in the wake of its completion.
“It became a lightning rod for feelings in London about the super rich,” RSHP Senior Partner Graham Stirk, the building’s lead architect, told Bisnow. “People were openly hostile about it, it got a real barracking. The heavy duty nature of it all meant I didn’t want to work in the UK for a while and started looking for projects elsewhere.”
A decade on from its completion, One Hyde Park still commands high prices when its flats sell, but London has changed. It’s still a global megacity, but less self-confident than in 2011, beginning to find a path in the post-Brexit world and suffering, as are all dense urban centres, from the ravages of COVID-19. The intervening years have changed the nature of wealth and of property. The scheme probably couldn’t be built today, and if it was, it would be unlikely to be as big and as brash. The same might be true of London.
“A Rather Drab Office Location…”
It was marketed as having potential for conversion to residential, but in spite of its location, looking out on to Hyde Park and a short walk from posh department stores Harrods and Harvey Nichols, established developers like Berkeley Homes turned down the chance to buy it.
“Knightsbridge at that time was essentially a rather drab office location,” Savills Head of Residential Development Sales Ed Lewis said. “You had Harrods, but it wasn’t exactly Bond Street or Cadogan Square.”
Enter two young entrepreneurs with a background in redeveloping and redesigning expensive one-off homes for wealthy clients, but little experience of large-scale development — brothers Nick and Christian Candy.
Project Grande (Guernsey) Ltd bought the site and began the creation of One Hyde Park. It was a joint venture consortium between Guernsey-based development company CPC Group, headed by Christian, and Waterknights, owned by the former Prime Minister of Qatar, Sheik Hamad bin Jassim bin Jabr Al-Thani. Candy & Candy, headed by Nick, was the development manager and interior designer for the project.
“Richard [Rogers] said there are two guys that want to meet us about bidding on some land,” Stirk recalled. “So we met Nick and Christian in a rented office near Victoria station. They described why they thought the scheme would work, and Nick said, ‘We just want you to build the best resi building in the world.’ When people say that, you think, OK … They wanted us to work on the bid and look at the capacity for the site, but they said they couldn’t pay us, which is a bit oxymoronic for someone who wants to build the best residential building in the world.”
The payment issue related to the release of funds from the project's backers, Stirk said.
The Emergence Of A New Kind Of Wealth
While the Candys had little experience in large-scale development, they did have something unique and invaluable — an insight into the wants, needs and whims of an emerging global super wealthy elite, and the ability to satisfy those needs.
“We knew there was a new category of the market who want nothing but the best and who were willing to pay for a certain level of service and luxury,” Candy Capital Chief Executive Nick Candy told Bisnow over email. (Christian Candy did not respond to an interview request sent to CPC Group.)
“This kind of product just didn’t exist in London or even globally at the time and it was designed and executed to meet a very specific requirement from the new international wealthy.”
“[The Candys] were ambitious, because they had found a market they were operating in, having done a lot of individual units around Knightsbridge and Belgravia, and sold lots of those to Russians who had deep pockets,” Lewis said. “They were buyers who just wanted to buy the most expensive thing, not because it was the best, but because it was the most expensive.”
“The Candys were the first people to spot that opportunity and they had the firepower to execute,” Wells Fargo Head of London Commercial Real Estate Max Sinclair said. Sinclair headed the team at German bank Eurohypo that loaned £1B in construction financing to the consortium developing One Hyde Park.
In one sense, the story of One Hyde Park really goes back further, to the mid-1980s and the “Big Bang” deregulation of London’s financial services sector, which was the first step toward London becoming a global city.
“You have to take the origins back to the Big Bang in the City, that was a catalyst for London becoming what it is today,” Knight Frank Head of Prime Central London Rupert des Forges said. “It became a centre of capital raising, it had a great lifestyle, the education system is great, it has a secure legal system. The scheme crystallised an era of wealth creation. It is a product that reflected the time.”
London’s rise combined with the Candys' knowledge of what the global elite wanted helped them create a product in One Hyde Park that no one had ever attempted before, which sparked a need to charge prices no one had ever seen.
The facilities include a private cinema, a 21-metre ozone swimming pool, saunas and steam rooms, private exercise rooms, relaxation and treatment rooms, a squash court, a gym, a golf simulator and virtual games room, wine cellars, a business suite, a private entertainment room, a library, secure underground parking, car cleaning and valet service. The building is next to the five-star Mandarin Oriental hotel, and residents have access to all of the services the hotel provides.
Even rivals in the high-end property world had to give Nick Candy credit for the attention to detail.
“The quality of the product, the finish, is still above and beyond anything else that is out there,” said Residential Land Chief Executive Bruce Ritchie, a residential investor who wasn't involved in One Hyde Park.
The interior design team was more than 100 strong, and the project used 15 types of stone sourced from as far afield as Turkey and Brazil, China and Egypt. At peak times, 2,500 workers were on the construction site every day.
“It’s the gold standard for residential real estate, not just in London, but anywhere in the world,” said Glentree Managing Director Trevor Abrahmsohm, one of the top London high-end residential brokers. “It’s like you’ve been driving a car your whole life and all of a sudden someone gives you a spaceship.”
Stirk remembers visiting a full-scale five-bedroom apartment built on a site near Stanstead Airport, used by the developers to check every element of the design specification and materials.
He said the site on which the scheme was built was complex, and it took a lot of effort to make the project work even before getting to those luxurious final touches and amenities. While it is on the edge of Hyde Park, the side of the scheme overlooking the park is north-facing, meaning it doesn’t get a lot of sunlight. To allow as much light as possible to pass into and through the scheme, Stirk and his team came up with the distinctive lozenge-shaped buildings connected by lift cores, and they used plenty of glass.
For a scheme that sells exclusivity, the developers packed a lot on to the site — 86 apartments and 21K SF of amenities on a site of more than 350K SF. In their original massing proposal for the bid, Stirk and his team had suggested putting about a third less on the site. But that size, shape and transparency created an issue. People don’t necessarily want to have their windows peered into when they’ve paid £50M for a flat. Cleverly placed screens mean that residents can see out of the flats, but other people can’t see in. Many of them are made out of patinated copper to pick up the colouring of the red brick buildings that are prevalent in the area.
Though the owners charged unheard-of prices for the apartments, buyers paid up. Savills’ Lewis said before One Hyde Park, the top price paid for London homes was about £2K to £2,500 per SF, with record prices of this level set at the nearby 199 Knightsbridge development.
The Candys were initially targeting £5K per SF, achieved an average of £6K per SF and reached a zenith in 2014: In May that year, a 16K SF penthouse apartment was sold for £140M with another £25M added on for a bespoke interior design scheme, breaching £10K per SF for the first time ever globally. A company owned by Ukrainian billionaire Rinat Akhmetov confirmed it was the buyer.
“Before One Hyde Park, people were still pricing things up as a two-bedroom flat,” Ritchie said. “They moved the perceived value of real estate upwards. People didn’t think you could charge more than £5K per SF, but everything at the high end moved up. If you were holding prime property at the time, you made money, and you have them to thank for that.”
Luck And Timing
As with any property development that takes years from conception to completion, there was a fair share of luck in One Hyde Park’s success.
“We were ambitious and we had great timing,” Candy said.
Eurohypo and Sinclair provided a £1B development loan for the scheme in 2006 on the back of pre-sales achieved at never-before-seen levels before construction started. That allowed the scheme to commence before the financial crisis fully funded, not needing to achieve sales during the rocky period from mid-2007 to mid-2009.
Knight Frank’s des Forges, one of the agents on the scheme, said that sales were paused for a year in 2009, and by the time the scheme was completed in 2011, the world’s economy was well into recovery.
In fact, for the kind of person that would buy an apartment at One Hyde Park, life had never been better than it was in 2011. The low interest rates and money-printing policies of central banks in the wake of the Great Financial Crisis boosted asset prices around the globe, making the rich even richer, even as real wages for global workers stagnated. The number of billionaires in the world rose from 946 in 2007, before the financial crisis, to 2,095 in 2020, according to Forbes. Global inequality has more than doubled in the past decade, as measured by the gap between the wealth of the world’s billionaires and the 4.6 billion people that make up the bottom 60% of the world’s asset holders, according to data from Oxfam.
Coupled with the commodities boom created by the economic recovery, One Hyde Park’s natural constituency grew.
“There were many parts of the world which during and after the GFC performed well economically — parts of the world where oil and other natural resources come out of the ground, plus the Far East,” Wells Fargo’s Sinclair said. “That created a demand from wealthy individuals to acquire personal real estate and this helped drive London’s attraction as a global city.”
That rise of the global super rich and the emergence of London as an international hub meant the location next to the Mandarin Oriental was more than just fortuitous, it was vital — and tells us something about how some billionaires live.
“What people didn’t notice is that building isn’t really a residential scheme, it’s a private hotel where the rooms are permanently reserved for the world’s ultra wealthy,” UCL Bartlett Real Estate Chair Professor Yolande Barnes said. “In the same way that the wealthy used to have a suite at the Dorchester that they rented all year round, it’s actually more akin to hospitality.”
Ultimately, the apartments at One Hyde Park sold for more than £1.5B, according to figures provided by Candy Capital. They still sell for about £6K per SF today in the secondary market, Savills said.
Great for the project’s backers, great for other owners of high-end property, but great for London and the UK at large? As Stirk pointed out, the scheme became a lightning rod for anger of many different types. Anger at the super-rich and the lives they lead, beyond the comprehension of most people in the world, treating expensive homes in London like hotels lived in for only part of the year. Anger toward the governmental, financial and tax policies that allowed that gap between them and the rest of the world to grow. Anger at London local authorities for green-lighting luxury schemes while not enough genuinely affordable housing is built. And anger toward London itself for the way in which its economy has accelerated while other parts of the UK have stagnated, exacerbating regional inequality.
The Guardian called the building “a monument to inequality". On Channel 4, Stirk’s partner Richard Rogers was asked why he had worked on the project but had designed relatively little social housing. The Sunday Times, publisher of the UK’s annual rich list, asked what the fact that so few of the homes were permanently occupied meant for London’s future.
The number of flats owned by offshore vehicles has drawn constant speculation about whether the apartments have been used by wealthy owners to reduce the amount of tax they pay, something Candy strenuously denied in a Property Week interview in 2013.
In many ways, it is not hard to see why the scheme attracts this attention. The huge scale of One Hyde Park makes it so prominent in its physical location and the public imagination.
“People don’t say the same things about the rich people of Holland Park or Belgravia or Mayfair,” Stirk said. “It is symbolic.”
He added that it is ironic, in that One Hyde Park’s affordable housing element provided 70 homes, almost as many as were built for full-price sale, but the scheme was criticised for building them 2 miles away.
“Even before Brexit and COVID, there was a worry that the success of London was becoming a problem for the rest of the UK, and the visible manifestation was the ever-spurting skyline,” said Tony Travers, professor of the London School of Economics Department of Government and director of LSE London.
In the case of high-end London residential, the perception of who buys it is a big part of public resentment.
“If Bill Gates wanted to live in London then we’d all think it was marvellous,” Travers said. “But there is a certain kind of very rich person, and the way they move their money in and through London and the amount of tax they pay, that raises attention.”
Who Exactly Lives There?
One Hyde Park has become associated with secrecy and suspicion because of the large number of apartments bought by anonymous offshore companies registered in tax havens like the British Virgin Islands and the Cayman Islands, meaning their ultimate owners are unknown. This is not an issue specific to the scheme. Transparency International found in 2016 that 44,000 London properties were owned by corporate entities, with 90% of those entities registered in secrecy jurisdictions.
Bisnow can reveal the fullest list ever produced of the building’s residents, using data related to the ownership of the block’s management company. Of the 86 apartments, 23 are owned by individuals rather than anonymous corporate entities, and those listed range from commodities magnates like Kairat Boranbayev to the children of wealthy Russians, like Ekaterina Fedun, daughter of Lukoil executive Leonid Fedun, to British entrepreneurs like Noel McKee, the founder of We Buy Any Car. (The full list can be found here.) Data firm LandTech provided Land Registry data for this piece.
London’s ascension to the position of a global city and a place where international investors want to park their money and live their lives, at least some of the time, means that the city will attract wealth from sources across the world, and this has driven huge growth in the top end of the capital’s property market.
The debate rages, and will probably always rage, about whether this is a good thing for the city and its inhabitants, and so the debate about One Hyde Park and schemes like it becomes a debate about what we think about billionaires and wealth inequality. In one corner are the proponents of the idea that wealth from the top end “trickles down” through the employment of staff like drivers or butlers and money spent on local shops, as well as the payment of taxes, if indeed those taxes are paid.
In the other corner are proponents of a theory you could call “dispersion,” like Anna Minton, author of the book Big Capital: Who Is London For. Minton argued the super wealthy buying in Mayfair, Knightsbridge or Belgravia push out the traditional residents of these areas, who move to Bayswater or Holland Park, pushing out the residents of these areas, and so on and so forth, making London ever less affordable.
UCL’s Barnes, who before becoming a full-time academic spent years as head of residential research at Savills, feels that, for better or worse, the prime central London market has essentially become divorced from the rest of the country, and has little impact on the housing that most people would ever buy.
“In the 1990s, there was a link between prime central London and the rest of the market,” she said. “Where that market went, the rest of the market would eventually follow. But from about 2008, after the financial crisis, it became almost fully separated from the rest of the market, and that is exemplified by One Hyde Park. After 2008, it became something for billionaires, not mere millionaires, and that is what set it apart.”
As an example, Barnes points to the fact that prices in prime central London have been falling since 2015 as a result of higher taxes and uncertainty about Brexit, while other areas of the UK and London have seen prices continue to rise, albeit more modestly than in the 2004-2007 boom and that of 2011-2014.
“If all the billionaires went away, it wouldn’t solve London’s housing crisis,” Travers added.
A New Phase For London
In 2011, London was reaching the peak of its powers, a city that showcased its confident, multicultural face at the Olympic Games. Today, while Brexit has not caused the exodus of jobs many predicted, just as after Big Bang, London must work out how to operate and flourish in a new regulatory environment.
One Hyde Park was a bold, brassy, confident scheme befitting a bold, brassy, confident city. Today, the scheme would not be built in the same way, if a developer could pull off building it at all.
No one interviewed for this piece thinks London will lose its place as a world city attractive for the global rich to live and buy property.
“In my view, London’s standing as a world-leading global city is as strong today as it was 10 years ago,” Candy said.
But it has clearly lost some of its pulling power. Data from Knight Frank shows that the number of prime homes of £10M-plus sold in the UK, principally London, has declined every year since peaking in 2014, when One Hyde Park sold a single square foot for the same price as a decent family car.
Developers are still building super luxury schemes, and buyers are still paying huge prices for them — for example, Lodha sold the penthouse at its scheme in Grosvenor Square for £140M in November — but on the whole, the market has returned to that previous benchmark of about £2,500 per SF, market participants said.
“It doesn’t have that upward trajectory, but it is more sustainable today,” Residential Land’s Richie said.
Some of the buyers fuelling the market in the first half of the last decade have exited for reasons beyond economics. Russian buyers in the prime London market for £10M-plus homes accounted for 26% of all sales in 2011, the year One Hyde Park was completed, according to data from Knight Frank. That dropped to just 6% in 2020, as the political climate between the UK and Russia has become icy in the wake of incidents such as the 2018 poisoning of Sergei and Yulia Skripal. High-profile Russians had their UK visas removed, eliminating a big source of demand.
And while the rich keep getting richer, they are perhaps not as keen to demonstrate it in the same way as in the years when One Hyde Park was being developed and the years immediately afterward.
“When we were originally selling the apartments, we told buyers, this is like a Fabergé egg, there are only a few of them in the world, and only certain people can buy them,” Savills’ Lewis said. “I don’t think we’d say it in the same way now. The wealth has moved on a bit to places like Mayfair and Belgravia; it is not as flash and brash. Money is more discrete, it doesn’t like to show off in quite the same way.”
“There is no question that after an unprecedented bull market, where avarice and conspicuous and ostentatious spending have been off the chart, a period of reflection and introspection is very much needed and necessary,” Glentree’s Abrahmsohm said.
Winston Churchill famously said in 1941 that “we shape our buildings, and afterwards our buildings shape us.”
The four interconnected blocks that make up One Hyde Park were shaped by the currents that created a new type of global elite and then brought that elite to London. And the building afterward shaped how we feel about the forces that made this possible and will continue to do so for a long time yet.