Trader profile: Alpine property lures buyers from the Gulf
Name: Giles Gale
Position: managing director of Mark Warner Property
Experience: 10 years
What is the asset class and geography you are focused on?
We are focused 100 per cent on sales and marketing of Alpine ski property in Austria and Switzerland. Our investors are looking for a safe and stable property investment that they can also enjoy for family holidays and also in retirement. Most of our clients tend to purchase apartments within managed resort developments. The advantage of this is that the properties are often “turnkey”, as the management company wants to ensure a common theme across the whole resort. Owners simply advise the management company of their preferred weeks of use and their apartment is then rented out for them for the remainder of the time. Chalet clients tend be slightly older and are focused more on the lifestyle rather than the rental returns. Chalet buyers will often use their property for much longer periods of time – perhaps planning to eventually retire there.
What is the outlook for the month ahead?
People tend to think that our business only operates during the winter. This couldn’t be further from the truth. We have a lot of clients who choose to visit the Alps during the spring as this is when the bargains can be found. Similarly, if you visit a ski resort in April and May and still enjoy it you are certainly going to like it in December and January. The Alps are massively underrated in the summer. Most of our buyers tend to purchase property with their eye mainly on the skiing but then find that they spend as much time in their property in the summer as they do in the winter. Indeed, Zell am See in Austria has really taken off as a summer destination for visitors from the GCC. The outlook is more viewings across the Alps, but with canny buyers who are aware that the developers may be more open to an offer once the winter season has finished.
What are the main risks, either upside or downside, to the outlook?
We have experienced first hand the risks from currency fluctuations this year when the Swiss National Bank removed its peg to the euro and the currency appreciated 30 per cent overnight. Fortunately, our buyers didn’t panic and the Swiss franc is now back to more normal levels. Most of our buyers are now looking to mitigate these risks by taking out a mortgage in local currency – even if they could have bought with “cash”. This makes even more sense now given that borrowing rates in Switzerland have fallen to a historic low of around 1.2 per cent and mortgages are readily available to GCC-based buyers.
What is the best investment at the moment?
For long-term, stable, capital growth I would look to Grimentz in Switzerland. Prices are about 50 per cent of nearby Verbier and Zermatt, but with uncrowded pistes and a whole host of new infrastructure developments planned. The resort has recently been linked to nearby Zinal by a vast single-span cable car that has doubled the size of the existing ski area. There is also a new boutique hotel development planned as well as a larger thermal spa.
What was the best investment you were ever involved in?
I bought my current house in Peckham, south-east London at auction just after the London riots. The area and house are now transformed and prices have risen dramatically. I also own a ski chalet in Zell am See, Austria. I now rent it out for weekly holiday lets and am achieving a yield of over 10 per cent on my total investment.
What was the worst?
I invested three years worth of student loans into the stock market while studying economics at Nottingham University. The dot.com bubble burst and I lost the lot. I’ve learnt my lesson now never to invest in anything that you don’t fully understand.
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Updated: March 22, 2015 04:00 AM