By Mary Jordan and Karla Adam
Washington Post Foreign Service
Thursday, March 8, 2007
LONDON -- They call themselves "the haves and the have yachts": rich London bankers and traders who drop tens of thousands of dollars for an evening of cocktails and hire "personal concierges" to get their girlfriends dresses like those worn by movie stars.
Long a hub for the world's ultra-rich, London has just welcomed an unprecedented number of newcomers into those ranks. Analysts here estimate that London's financial stars were paid a total of $17 billion in annual bonuses in recent weeks -- including more than 4,200 people who received bonuses of at least $2 million each, on top of salaries already sagging under the weight of zeros.
"There is a great deal of money sloshing about," said Tony Travers of the London School of Economics, noting that 15 years of uninterrupted growth in one of the world's most open economies has set London's financial sector swaggering.
This has drawn attention from Wall Street, which regards itself as the center of the financial universe and is not unfamiliar with staggering and conspicuous wealth. A January report commissioned by New York Mayor Michael R. Bloomberg (R) and Sen. Charles E. Schumer (D-N.Y.) concluded that increasingly tight regulation of U.S. financial markets, as well as strict immigration laws, were hurting New York, while rival London, closer to rising giants in Asia and Russia, was becoming more attractive to business and talent.
The swelling number of London's rich means high times for tailors, jewelers and other people whose job is to cater. Personal concierge services -- your whim is their command -- have never been busier. They jump for customers who, for instance, want one of Britain's soccer superstars to report for duty, like a pony, at Junior's birthday party.
Business is soaring at Quintessentially, which provides 24-hour assistance to customers who need to "access the inaccessible," said company co-founder Aaron Simpson. Three customers recently ordered $6,000 replicas of the Marchesa gown that actress Jennifer Lopez wore to this year's Academy Awards ceremony. The company is also trying to satisfy five women who want to buy a pair of the itty-bitty blue swim trunks that actor Daniel Craig wore in "Casino Royale," the latest James Bond film.
Quintessentially has handled requests for an elephant-shaped cake studded with rubies and emeralds, and a parachute trip over Victoria Falls on the Zimbabwe-Zambia border in southern Africa. Simpson explained it this way: "The adrenaline rush you get from making a 10 million-pound bonus is the same as falling off a cliff at 3,000 feet."
Mark Alexiou, owner of Pangaea, a trendy nightclub in the Mayfair district, said one of his recent banker customers tried to pay the $36,000 check for an evening of cocktails with his credit card. When the bank authorization wouldn't come through, one of the man's buddies stepped in and put the bill on his card, as casually as he might order another dish of cashews.
"Life is pretty all right," said Tayo Awagboro, 24, a derivatives trader who dropped a relatively modest $1,400 on champagne and vodka at Pangaea one recent Saturday night. Awagboro, who recently moved to London from Nigeria, said London's financiers "work hard but play hard, too."
Rich Russians, Arab sheiks, Indian moguls and other foreigners are among those buying up mansions like cartons of milk. At One Hyde Park, a luxury apartment complex that the British media have dubbed the world's most expensive address, the cheap apartments are going for $40 million and the penthouses are expected to fetch well over $100 million each.
"It is almost like a poker game," said real estate agent Philip Eastwood. By his account, multimillionaires often sit across the table from one another, both wanting the same property, and bidding up prices.
Datamonitor, an independent analyst group, said this year it expects that there will be 1 million people in Britain with liquid assets -- this does not include property -- of $400,000 or more, up from 690,000 in 2003. The number of those with millions in cash is also growing significantly, said Kate Langdridge, a Datamonitor analyst, who noted that the mega-rich are increasingly younger. Retirees in their 40s are common.
Lawrie Inman, 25, a futures trader, said he made $1.4 million in one particularly good hour last year. "I realize how lucky I am; I can take a really nice holiday or buy a Porsche," said Inman, who does drive a Porsche 911 and wears jeans and a T-shirt to work.
Garry O'Dea, a luxury car sales executive, said that at his spacious H.R. Owen Sports Car dealership, the waiting list for a new custom-made Ferrari is three years.
On a recent Saturday, one investment banker who couldn't wait that long bought a standard one from the showroom floor. "Life is beautiful," said the young man in a tweed jacket, who did not want his name used. He grinned widely as the glass windows of the store opened and he peeled out in his shiny red car onto the street.
Demand for cars costing more than $200,000 is rising, O'Dea said.
London auction houses are doing bigger business as well. Last month, Christie's broke records with $400 million in sales in a single week. The same week, Sotheby's raked in $365 million, with auctioneers noting that many items went to first-time buyers.
Not everyone here thinks the growing signs of conspicuous wealth are a positive change.
Peter Hain, an outspoken member of Prime Minister Tony Blair's cabinet, called the recent bonuses "grotesque" and said the recipients should give lumps of it to charity. A recent poll found that 73 percent of respondents agreed that bonuses were "excessive and something should be done about them," while 69 percent said the gap between the highest-paid and average earners is now too big.
"There is one extreme or another -- people buying private islands and the working class struggling with the mortgage," said Andy Holme, who works at a new service that provides chauffeur-driven Rolls-Royces and Bentleys. Cost of an airport pickup at Heathrow? As much as $1,200.