The tiny sovereign Principality of Monaco has always been home for the world’s wealthiest and offers for those considering living in the 2 square km area low taxes and an ultra cosmopolitan lifestyle.

Since 2010 Monaco has enjoyed robust economic growth with a per capita income of $187.650 and as a result has led to an increased demand in its residential market which saw €2.25billion in sales in 2015. Ultra prime price per square meter averages €90,000 just behind the highest in this category, Hong Kong and with London at €55,900 per square meter.

In its research report of Monaco, Savills showed average prices and their fluctuations: ‘In 2015 the average resale price in Monaco stood at €3.5m, down 4.8% on the year prior, while the median price, at €2.1m, was up 5.0%. The long-term median price trend shows consistent growth, averaging 5.8% per annum since 2010.’

So who lives in Monaco? The report states that a quarter of the occupants are Monégasque with the others representing 144 nationalities with the largest groups being of French, Italian and British origin with many not only being residents but also have businesses based in the Principality. The population density is 18,700 per square kilometer and the land has been fully developed.

New Build Sector

Popular with investors Savills reports that new builds accounted for 7% of the total sales volume in 2015.  When the global economy hit a brick wall: ‘…developers in Monaco shifted their focus to the global ultra-prime segment. They built large, well-appointed luxury property units in schemes with extensive on-site amenities targeted at wealthy end-users.’

The new build sales consisted of units with half being one bed units with an average sale price of €3million which are not only popular for residents but have become a source for the large rental properties market by international owners. New build sales volumes totaled €454million in 2015.

Approved in July of 2015 was a new project, it is the six hectare Le Portier expansion, most of which will be mainly residential space with an extension of the Grimaldi Forum with a marina, park and a seafront promenade. Work has been scheduled to begin this year with completion by 2025.

For the super wealthy is the 73 unit development, Les Giroflées. This is another future development in the Larvotto district as well as the 150 unit Testimony II in St. Roman for Monégasque nationals.

Office Property Sector

But its not just residential and rental property that continues to grow, office property has also continued to be popular. Because of its favorable tax situation, Monaco is attractive to a wide range of businesses and family firms. Not surprisingly office space is in short supply with Grade A office rents at €1,140 per square meter per annum. Most of the office space is located in Fontvieille, with banks and financial institutions located in Monte Carlo, LA Rousse and Le Condamine.

New delivery has been limited in recent years. The small amount of new supply set to come forward as part of mixed-use schemes will do little to ease the shortage in the near term. To work around the office space shortage new residential developments are adding potential office space such as La Stella which will have 99 residential units with four floors of office space.

As Monaco continues to keep its reputation as a global financial safe haven and a sophisticated residential market, Savills rightly concludes: ‘Thanks to its history, heritage and busy sporting and social calendar, the Principality has an unrivalled global reputation as a destination
for the world’s wealthy.’

By Kevin Murphy:

Property Newsletter
Register for our newsletters to receive details of our latest property promotions.