The centi-millionaires and billionaires who are clients of Citigroup Inc's (C.N) private bank still want to invest in the fanciest real estate in North America, despite recent signs that segments of the high-end market have begun to cool.
"It's still quite robust," Ida Liu, Citi Private Bank's New York market head, said in an interview at Reuters Global Wealth Management Summit on Tuesday. "It's the safest haven for them to diversify."
The bank works with a third of the world's billionaires, including many in China, and clients continue to see North America as the "No. 1 most desirable place" to invest, Liu said at the event in New York.
In recent years, Citi's private banking clients helped fund the construction of the tallest skyscrapers in Manhattan and Boston. The bank plans to launch another co-investment project in another North American city in coming weeks, Liu said, declining to provide more details.
Before being promoted to her current role earlier this year, Liu worked with Citi clients in Asia who wanted to invest in the United States. Those clients' appetite for high-end real estate in major U.S. cities is still very high, Liu said, noting that they hold as much as 60 percent of their portfolios in real estate, and are drawn to physical assets that appreciate quickly.
Citi raised $400 million from clients investing in the Manhattan skyscraper 432 Park Avenue during a three-week period in June 2012.
Clients, who could invest as little as $250,000, paid roughly $2,000 per square foot. Space in the building is now selling for around $6,000 per square foot, Liu said.
"Do we feel that 432 Park Ave is a great investment opportunity for our clients? Yes," Liu said. "When you have the right property and the right profile, we think it's a very attractive investment."
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(Reporting By Elizabeth Dilts and David Henry in New York; Editing by Dan Grebler)