Centimillionaires, individuals with a total net worth of over $100 million, belong to an exclusive club that is reserved for the ultra-wealthy. According to Kevin Teng, CEO of WRISE Wealth Management Singapore, there are approximately 28,420 centimillionaires globally. These individuals are mostly concentrated in cities like New York City, the Bay Area, Los Angeles, London, and Beijing. These cities are known for their robust financial infrastructure, vibrant entrepreneurial ecosystems, and lucrative real estate markets, making them attractive destinations for the ultra-wealthy.
These individuals have a very selective approach when it comes to investing. They are not interested in “get rich quick” schemes or volatile investments like publicly traded equities or cryptocurrencies. Instead, they focus on preserving their legacy and wealth. Salvatore Buscemi, CEO of Dandrew Partners, mentioned that centimillionaire portfolios often include stable pieces of real estate, specifically “trophy asset” Class A properties. Real estate investments typically represent 27% of these individuals’ portfolios, according to Michael Sonnenfeldt, founder and chairman of Tiger 21.
Centimillionaires usually have their wealth managed by single family offices, which handle various aspects of their finances, including inheritance, household expenses, credit cards, and immediate family expenses. These family offices also have foundation arms for charities and venture capital arms that invest in high-growth startups. The number of family offices in the world has tripled since 2019, surpassing 4,500 worldwide last year with an estimated $6 trillion in assets under management.
Apart from real estate, centimillionaires also explore opportunities in private credit, fixed income, and alternative investments. Private credit is gaining popularity among these individuals as they seek unique risk-return profiles outside of traditional markets. Alternative investments like venture capital, private equity, and real assets offer diversification and potentially higher returns.
Another avenue that centimillionaires explore is buying stakes in professional sports teams. According to Salvatore Buscemi, owning a stake in a sports team is a way for these individuals to legitimize their status and gain access to an exclusive group of like-minded individuals. The exclusivity and prestige associated with owning a sports team add to their appeal. It is seen as a symbol of status and recognition, much like receiving knighthood in the United States.
The world of centimillionaires is a unique one that requires a distinct approach to investing and managing wealth. These individuals prioritize stability, legacy preservation, and exclusivity in their investment decisions. By focusing on real estate, alternative investments, and ownership of professional sports teams, centimillionaires aim to secure their financial future and leave a lasting legacy for generations to come.
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