Bengaluru has fourth highest ultra-wealthy population in the country: Knight Frank Wealth Report 2022

Mumbai, March 2, 2022: According to Knight Frank’s The Wealth Report 2022, Bengaluru was home to 352 ultra-high net worth individuals (UHNWIs, with a net worth of US$ 30m and above) in the year 2021, which was the fourth-highest in the country. The ultra-wealthy population in the city is expected to increase by 88.9% to 665 by the year 2026. In the last 5 years, Bengaluru’s ultra-rich population grew by 22.7% from 287 in 2016 to 352 in 2021.

In India, the number of UHNWIs grew by 11% YoY in 2021, the highest percentage growth in APAC. India also ranked 6^th in percentage growth of the UHNWI population that is self-made and under the age of 40 years. Globally, the the ultra-wealthy population saw an annual increase of 9.3% to 610,569 in 2021.

Wealth surge in the UHNWI population

Source: Knight Frank Wealth Sizing Model

Shishir Baijal, Chairman & Managing Director, Knight Frank India said “Equity markets and digital adoption have been key factors driving the growth of UHNWIs in India. The growth in younger, self-made UHNWIs has been incredible in India and we foresee them driving new investment themes and innovation. With healthy growth in the UHNWI and Billionaire population, India is expected to be one of the fastest-growing countries amongst its global peers, further strengthening itself economically and emerging as a superpower in different sectors.”

 PROPORTION OF TOTAL WEALTH ALLOCATED TOWARDS REAL ESTATE

According to the Attitude Survey that is part of the Wealth Report 2022, 29% wealth of Indian UHNWIs is allocated towards the purchase of principal and second homes. Further, 22% of UHNWIs investable wealth was allocated towards the direct purchase of commercial property (including rental property, offices etc) while 8% of the investable wealth was allocated towards the indirect purchase of commercial property (includes REITs, funds). Additionally, the survey cited that 8% of the property portfolio is held overseas.

HOW MUCH SPACE CAN US$1 MILLION BUY?

Monaco continues its reign as the world’s most expensive city where US$ 1 million can get you 14.6 square metres of space followed by Hong Kong (21.3 Sq.mt) and London (30.6sq.mt) in 2021. Comparatively in Mumbai, you can purchase 108.1 square metres (1164.02sq.ft.) of prime residential real estate, a 2% increase compared to 106 square meters (1140.9 sq. ft.) in 2020. In Delhi, you can purchase 206.1 square metres (2218 sq.ft.) and Bengaluru 357.3 square metres (3845.9 sq.ft.) of prime residential real estate with an increase of 2.03% and 1.76% respectively.

 Area (in square meters) purchasable for US$1 million over the last 5 years

                                     Source: Knight Frank Research

PASSION LED INVESTMENTS

According to the attitude survey conducted by Knight Frank’s The Wealth Report 2022, 11% of the investable wealth of Indian ultra-high net worth individuals (UHNWI, whose net worth is US$ 30m or more) is allocated towards passion led investments against the global average of 16%. About 29% of Indian UHNWIs spent more on passion investments during the year 2021. The joy of ownership scored above investment returns and was marked as the driving factor to collect investments of passion by the Indian ultra-rich.

Art was the most preferred investment by Indian UHNWIs, followed by Jewellery and Classic Cars. Luxury Handbags and Wines slipped from their earlier 1st positions to 5th and 7th respectively in 2021. According to Knight Frank’s luxury investment index (global), Art provided a return of 13% in a 12 – month period and 75% over 10 years.

PASSION LED INVESTMENTS – OBJECTS OF DESIRE FOR INDIAN UHNWIS:

Source: The Wealth Report Attitudes Survey