Alpha territoriality in Hong Kong and London: The socio-economic implications of transnational real estate investment by the super-rich

Social research has tended not to focus on the super-rich, largely because they are hard to locate, and even harder to collaborate with in research. In this project we seek to address these concerns by focusing extensive research effort on the question of where and how the super-rich live and invest in the property markets of the cities of Hong Kong and London. We see these cities as exemplary in assisting in the construction of further insights and knowledge in how the super-rich seek residential investment opportunities, how they live there when they are 'at home' in such residences and how these patterns of investment shape the social, political and economic life of these cities more broadly. Given that the super-rich make such decisions on the basis of tax incentives and the attraction of major cultural infrastructure (such as galleries and theatre) we have proposed a program of research capable of offering an inside account of the practices that go to make-up these investment patterns including processes of searching for suitable property, its financing, the kinds of property deemed to be suitable and an analysis of how estate agents and city authorities seek to capitalise and retain the potentially highly mobile investment by the super-rich.

In economic terms the life and functioning of rich neighbourhood spaces appears intuitively important. For example, attractive and safe spaces for captains of industry, senior figures in political and non-government organizations are often regarded as major markers of urban vitality and the foundation of social networks that may make-up the broader glue of civic and political society. Yet we know very little about how such neighbourhoods operate, who they attract and how they are linked to other cities and their neighbourhoods globally. Our aim in this research is to grapple with what might be described as the 'problem' of these super-rich neighbourhoods - sometime called the 'alpha territory' - and undertake research that will help us to understand more about the advantages and disadvantages of these kinds of property investment.

The life and impact of the residential choices of the 'super rich' has been a major strand in research by the research team. This work advanced the proposition that the upper-tier of income groups living in cities tend to exploit particular forms of service provision (such as education, cultural life and personal services), are largely distanced from the mundane flow of social life in urban areas and tend to be withdrawn from the civic life of cities more generally. Some of this work is underpinned by the literature on, for example, gated communities, but it has surprisingly been under-used as the guiding framework for close empirical work in affluent neighbourhoods, perhaps largely as a result of the perceived difficulty of working with such individuals. This project will allow us to generate insights into how super-rich neighbourhoods operate, how people come to live there and the social and economic tensions and trade-offs that exist as such processes are allowed to run. As many people question the role and value of wealth and identify inequality as a growing social problem this research will feed into public conversations and policymaker concerns about how socially vital cities can be maintained when capital investment may undermine such objectives on one level (the creation of neighbourhoods that are both exclusive and often 'abandoned' for large parts of the year), while potentially fulfilling broader ambitions at others (over tax receipts for example).

The main beneficiaries of this work are the public and policymakers in local and central government:

1. The public - Given the significant appetite for research on how the rich live, tax and social justice we will seek to engage with these broader public debates. The research will provide often-unique insights into the worlds of the super-rich in Hong Kong and London and the consequences of their social and capital investment in these locales. We will engage public understanding of these issues by i. creating an email update function on a project website so that anyone can request to be kept informed of outputs as they arise from the project, ii. consult with and write for print news media, TV and radio outlets, with which we already have good relations (BBC and London Review of Books, Le Monde Diplomatique among others), iii. in addition to offering ourselves for interview and commentary we will generate a short (2,000 word) plain-language summary of the key findings of the research that will be made available on the project website and, finally, iv. the project will be formally press-released by both lead institutions in London and Hong Kong.

2. Policymakers - There is significant interest by policymakers in local and central government, urban planning and housing who we can connect to our research findings. Attracting this footloose population has been socially divisive and so we will engage these beneficiaries in two key ways. First by circulating a plain language project mini report (3,000 words and with a short executive summary including data visualisations and tables to assist their digestion) that identifies a range of policy issues and possible measures raised by the research. Second, the production of a short (five minute) video involving interviews with the researchers and a summary of the key points to emerge from the research that will be placed on the Centre for URBan Research (CURB) website. Both outputs will be geared toward public discussions and policy perspectives on economic growth, development issues, sustainable neighbourhood management and the connections between net gains in inward capital investment and the kind of problematic housing and social consequences of such flows to the social life of the city and economy more broadly. This will include identifiable 'policy options' that focus on this group. More specifically we will engage and update key figures within the RSA, the Joseph Rowntree Foundation, housing charities, the IPPR and so on. Right of centre and market-oriented think tanks will also be likely beneficiaries given their beliefs about the role of the rich as wealth generators and economic catalysts more broadly. All such relevant foundations and policy affiliations will be identified and targeted with an update on our activities, links to the project summaries and to the final video.