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Estate agents are sometimes obliged to go the extra mile to sell a property. For most, that means an after-work viewing or a drive out of town. For Edward de Mallet Morgan, it meant stripping off and swimming with sharks.
De Mallet Morgan sells private islands in the Caribbean for Knight Frank. When some clients doubted that the native nurse sharks were benign, he was obliged to prove them wrong.
Welcome to “the rarefied world of trophy assets”, he says.
There are innumerable private islands for sale around the world, from three-acre outcrops in the Aegean to remote eco-outposts in the Bahamas and luxury resorts in the Seychelles. They are expensive, build costs can be astronomical, and there are many pitfalls. The FT spoke to a number of people with experience of private islands and selling them living on them to find out how to avoid disaster. Here are our seven tips for buying an island.
Place yourself
“The island is always a dream: it’s not something easy, it’s not something banal. It’s something special,” says John Bracco, sales director at Immobilsarda, an affiliate of Christie’s International Real Estate. Bracco, whose business is mostly conducted in the waters around Italy, says that islands offer privacy and a connection with nature. In the Mediterranean, he adds, there is a scarcity value: “It’s not like in the Caribbean where you have hundreds.”
Wherever you buy there are complications. Off Italy, almost all islands are state-owned and not for sale, says Bracco. Those that are often have strict regulations governing development. Nonetheless, he says, “there are still people who want to buy islands they can’t build on”.
Purchases in much of the Caribbean are governed by British law, making transactions relatively straightforward. The freeholds to many are owned by holding companies so transactions take the form of share sales, says de Mallet Morgan.
Twin Islands, Alaska © vladi-privateislands.de
In Thailand and other parts of Asia, freehold islands are rare, foreigners are often barred from owning land and buyers can have difficulty establishing ultimate ownership, he adds. In Vanuatu, in the South Pacific, there is no freehold land but leases can be extended at any point for a fee.
Once you have bought your island, building on it is the next problem, Ownership rights on Caribbean islands extend to the high-water mark and jetties require special permissions.
Business or pleasure?
Buying an island for private use is similar to buying an expensive house, says John Christie, who, as chief executive of Bahamas agency HG Christie, “sells islands all day every day”.
If you plan to make your island a commercial proposition, however, things can get more complicated. In the Bahamas, commercial buyers need approval from the government’s investment authority. Christie estimates that 80 per cent of buyers in the Bahamas are purchasing for family use, which helps them navigate the process quicker. Once the approval is granted, he says, some do edge towards moneymaking schemes.
© Brett Davis
Many of Christie’s buyers “want to be like Richard Branson”, he says. The British entrepreneur was an island pioneer. In 1978, he bought Necker in the British Virgin Islands for $180,000 and has since transformed it into a luxury resort. A one-night stay on Necker now costs $5,000. For $77,500 a night, 30 guests can book the entire island.
Little Pipe Cay, a 38-acre island in the Exumas archipelago of the Bahamas, was bought after its previous owners “weighed up the pros and cons of buying a superyacht or a private island. They went for the island because it might appreciate in value,” says de Mallet Morgan. Bought and developed by billionaire Michael Dingman — the former president of Shipston Group and a director at Ford and Time Warner, who died in 2017 — the island is currently on sale for $85m with Knight Frank.
Be minted
Invariably, islands are expensive. But that is unlikely to dissuade many private island buyers. In the Bahamas, purchase prices run from $700,000 for “a three-acre island with some vacant land” to $70m for “a 100-acre acre that’s totally developed, or a 700-acre undeveloped plot”, says Christie.
The cheapest island Marcus Gondolo Gordon has ever sold — “absolutely tiny, mired in planning [complications], a perfect little hump of a green island” — cost €5m. In and around Greece, the average cost of an island is €10m-€20m, but can be as high as €85m, says Gondolo Gordon, whose company Incognito Properties sell islands worldwide.
Velaa Private Island in the Maldives
Off Panama, a trio of islands is available. The buyer will only be able to develop 30 per cent of their 1,800 acres, and must do so in an eco-conscious fashion. A $100m price tag might seem steep, but any buyer “is not simply acquiring real estate but will also acquire a global legacy”, according to Hana Ayala, co-seller of the islands.
For most buyers, price is of limited consequence. Not many opt for a mortgage. “I’ve never experienced anybody take out funding,” says de Mallet Morgan. Among the owners in the Exumas are hedge fund managers, franchise owners from the NBA and NFL, and football club owners. Johnny Depp, the actor, and David Copperfield, the magician, also own here.
Other island owners include Larry Ellison, co-founder of Oracle, and the actor Leonardo DiCaprio. Marlon Brando purchased an entire atoll in French Polynesia in the 1960s. Once a place to entertain Tahitian chiefs, the islands are now occupied by “The Brando Resort”.
Be ready to push the boat out
Acquiring an island gives you the chance to “create your own kingdom just minutes from the mainland, or miles offshore”, says Joe Sortwell, a broker at LandVest who works in the north-eastern US.
But building these kingdoms can be a headache. Shipping materials from the mainland can push up build costs dramatically, and ensuring islands are self-sufficient and sustainable is a tall order.
You can have your island in the middle of nowhere, and then a 150m superyacht comes and moors up
“Construction costs go absolutely through the roof because everything has to be shipped in or flown in,” says Gondolo Gordon. “What might be $3,000 per square metre on the mainland is double that on an island,” he says.
Mark [not his real name] owns Lataro, a 719-acre island off Vanuatu, and has spent a decade building on the jungle-bound outcrop. He estimates that 60 container-loads of materials had been shipped over from elsewhere in the region, most on a barge which was custom-built for the task. The island is currently for sale for $9.95m through Incognito Property.
“The reality is, you can buy islands for $5m-$15m with no structures on them. The ‘real purchase price’ then needs to take into account the time and development costs,” says de Mallet Morgan.
Think logistics
When building started on Lataro, Mark bought chainsaws by the pallet. Local labour also posed a challenge: “They didn’t know how to use a screwdriver.”
“You have to be 100 per cent self-sufficient: organic sewage, solar panels, a well, a satellite for internet. And on a saltwater island you have a well with desalination,” says Bracco.
Splendid isolation comes at the price of convenience. “If you are in deepest darkest French Polynesia and someone gets bitten by a shark, you have to factor in: ‘how far away am I from civilisation?’ ” says de Mallet Morgan.
But there is a silver lining, says Mark — speaking to me from his yacht off the coast of New Zealand. “We also found that it [the island] is a tax haven — that’s really a bonus. What we spend to run it, we save in tax. It’s free.”
Consider your neighbours
“I’ve seen so many expats go in and fail spectacularly by treating the locals as idiots, because they have different standards and different values,” says Mark, who employed local people and respected their approach.
There were, nonetheless, some hiccups. “There were some inter-village wars when we got there, and they [ the villagers] were killing each other. If you sack them they really will come and have a go at killing you,” he says.
Richard Branson bought Necker in the British Virgin Islands for $180,000 and has since transformed it
Chief among buyer demands is privacy, but unwelcome visits can be hard to prevent. “You can have your island in the middle of nowhere, and then a 150-metre superyacht comes and moors up. If they’re having a disco you’ll hear that, and then there’s jet skis screaming around,” says de Mallet Morgan.
Also consider who might be moving in soon. In Vanuatu and the wider Pacific islands, says Mark, the Chinese “seem to be buying up everything with significant land here”. There is even talk of direct flights between China and Espiritu Santo, Vanuatu’s main island, as China’s Belt and Road initiative — which targets overland “belts” and maritime shipping lanes or “roads” — sees investment pour into the region.
Watch the tide
Hanging over all the prosaic concerns is a more existential one. On Little Pipe Cay, every building has remote-operated shutters, which drop in unison at the push of a button. Floods and hurricanes in the Caribbean can be brutal, and climate change is a concern.
“For an island it’s a big issue,” says Gondolo Gordon. “The Greek islands are quite hilly so you can stick your villa at the peak. But on some Maldivian islands the highest point is about 1.5m. If you’re in the cyclone belt that’s an issue.”
Where Near St George Peninsula in Maine. Knox County Regional airport is about 20 minutes from Wheeler Bay, the closest mainland.
What A five-acre island with 1,700ft of shoreline and a four-bedroom residence across five buildings.
Why The main house has an octagonal library with full-length windows, and the sale includes most of the furniture, a canoe, kayaks and a Boston Whaler 130 Super Sport.
Who LandVest
, tel +1 207 236 3543
Isola Delle Femmine, Italy, €2.9m
Where In Sicily, 300 metres from the town which it shares its name. Palermo Falcone-Borsellino airport is 13 minutes’ drive from the town.
What A 15ha island inhabited only by a 16th-century watch tower, built as part of a coastal defence system.
Why The town has beaches for diving, windsurfing and boat trips. Along the coast is a 585ha nature reserve with trails and caves.
Who Christie’s International Real Estate
, tel +39 0575 788948
Prince Cay, Bahamas, $1.075m
Where Part of the Abacos, a 120-mile chain of islands in the Bahamas. A small airport on Spanish Cay is 3km away.
What A nine-acre undeveloped Caribbean island.
Why A small formation of barrier rocks creates the island’s own lagoon — a rarity on the Abacos.
Who Christie’s International Real Estate
, tel +1 242 322 1041
Alex Howlett
On the rocky cliffs of the Greek island of Karpathos in the Aegean is the Patio House, built by Stockholm-based OOAK Architects, writes Alex Howlett. The grey, boxlike structure perches on the cliffs, cantilevering over the edge. While the house looks alien to its rugged surroundings — all clean lines and geometric shapes — by using rough, unpolished concrete for the exterior, its architect describes the Patio House as harmonising with its location.
“It was about how little we could do and how much effect we could have,” says Maria Papafigou, a partner at OOAK architects.
It took the owners — a Paris-based family of windsurfing-enthusiasts — a while to find the right location. Much of the island is “too barren, too dry, too windy”, they said. Eventually, they found the perfect spot with great views and protected from the strong winds by the cliff and surrounding vegetation. “Most of the workers came from the island, and we soon got the feeling that it was a communal project,” the owner says.
There were challenges building in such a remote location. Papafigou says that transporting everything to the island caused problems ranging from damages to delays: “Even the tree in the courtyard had to go to rehab for two months,” she says, referring to the time it had to spend at a tree nursery in Crete. But, says Papafigou, it was all worth it to create “a vision a little bit out of the ordinary”.
Alex Howlett
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