British developer Nick Candy sees Dubai as the world's most undervalued real estate market, driven by strong demand, limited supply, and safe haven status.

• Dubai rents soared 50% in 18 months, but Candy says it's from a low base.

• He predicts Dubai property prices could reach $5,000 per sq ft, eventually hitting $10,000.

• Candy favors branded residences and sees limited competition in the high-end market.

• He believes Dubai benefits from stable leadership and vision for the future.

• While cautious about potential regional conflicts, Candy remains bullish on Dubai and Saudi Arabia.

Francine Lacqua interviews British entrepreneur Nick Candy. He is best known for working alongside his brother Christian to create One Hyde Park, a residential development in London’s exclusive Knightsbridge district and home to some of the world’s richest people. Now Candy is focused on developing projects in the Middle East, which he calls “the most undervalued real estate market in the world today.” He also has a lot to say about the current Conservative UK government.

Here is a lightly edited transcript of their conversation. Listen to the full episode below,

Francine Lacqua: Nick, thank you so much for joining us on the podcast. Where do you see the biggest growth coming from? So you're the high, high end of luxury real estate. Is it the Middle East that's moving here? Is it Asian customers? Is it the US?

Nick Candy: So, Asia’s harder, and obviously Russia and Ukraine's dried up. In the late 1990s, early 2000s, my biggest clients were from the ex-USSR. Today, Middle East still love coming. They're preferred place to come, more than America, more than Paris, more than any other city in the world, is to come to London. They've invested huge amounts, not just individually, but through their sovereign wealth funds into our great city.

There was two big deals over a hundred million pounds last year from two Indian purchasers. Uh, [Adar Adar] Poonawalla and Ravi Ruia, that's public, Bloomberg have covered it. There's been lots of other deals as well, which no one knows about, which are under the market effectively. I think London at the high end is still doing very, very well. But the most undervalued real estate market in the world today, without a doubt, is the Middle East, by a million miles. And the reports show it. The research reports show it.

Lacqua: But how?

Candy: Because it's cheap on a global scale. Because London, New York, Paris, Hong Kong, Singapore have all done well for a long period of time. Hong Kong's obviously having a dip. Singapore's just put a 60 percent tax on foreigners buying a property, so stamp duty tax. So if I buy a property for, you know, 1 million dollars, I have to pay 1.6 million dollars. That's a huge tax. Wealth is portable, so wealthy people have gone to the UAE and are going, ‘Actually, there's great education here, great hospitals here. I can live here. Yes, I can put my kids in school here. I can have a great quality of life. I don't have to worry about crime.’ And I think crime is a huge deterrent and you're seeing cities like San Francisco, Chicago, New York being destroyed by crime. And we're on the way. Don't make no mistakes. If we continue on the trajectory we're on now, we will be in the same position.

LACQUA: Nick, all the Russians moved to Dubai.

CANDY: And Ukrainians.

LACQUA: And Ukrainians. But if you, if you walk in Dubai, that's very present.

CANDY: I think Dubai reminds me today of how London was 20 years ago, 15 years ago, with every international community there. It's not just Russians and Ukrainians, it's Indians, Africans, Asians, British. The largest buyers in Dubai last year, at the very top end, were German and Swiss. So it wasn't Russians and Ukrainians.

Okay, so, and the research reports by either UBS or by Savills that came out say the biggest growth this year in any city will be Dubai and Sydney. So on a global scale, if you can buy a top property for $2,000 a square foot, or $3,000 a square foot, compared to the top properties in London, or New York, or Paris, or Hong Kong, that's very cheap.

LACQUA: Is it people that want it as an investment or are they actually moving to Dubai?

CANDY: I think it's both. I think there's the investment side, and there's also people that actually want to move. I'm looking at schools for my two young girls who are 10 and 6. London's my preference, but I will look at the UAE.

LACQUA: So rent has gone up some 50 percent, and we hear it from all of our colleagues. So rent, I mean, it's actually, in the last 18 months, right, you have, you have to pay double what you were paying two years ago.

CANDY: It was probably a low base to begin with. So it's supply and demand. If you've got huge demand and you haven't got the supply built already, then obviously prices increase.

LACQUA: Supply's coming, quite a lot of it.

CANDY: There'll be a lot. It’s different, there will be low-end, there'll be mid-end, there'll be high-end. You have to cater for all markets. So there's this huge opportunity there. I started my real estate, you know, when I was in 1995, my grandma gave me and my brother £6,000 and we bought our first flat. If I was that same 20, 25, 30-year old today starting up again, I would be running to the Middle East. I would be running to the UAE or Saudi or Bahrain or, you know, to develop because I think there's just, there's huge opportunity.

LACQUA: But I've seen and I remember actually, you know, Dubai and other places in the Middle East had this incredible boom in real estate and then there was kind of like a bust. So it cycles.

CANDY: It cycles, but I don't agree with it this time. I've done a lot of research on this because a lot of people ask me this question. So I think this time around the structure and the base is a lot stronger. Okay, you have institutional investors into the region. You've got Brookfield, you've got Blackstone, you've got Blackrock, all investing huge amounts into the region. Okay, they see the opportunity. Okay, and it's a safe place. There's not many places which are safe places, but the UAE is a very safe place to live.

LACQUA: I mean, again, given the amount of supply that's coming on the market, how much do you think that the market is undervalued by?

CANDY: Lower and mid, again, I can't comment because it's not my field of expertise. But at the very top end, so the branded residences, the top-branded residences in the world, there's still a very limited [supply], we're talking less than a few thousand flats or villas, down to an incredible standard. And are there a few thousand people in the world that want the very best and live in a safe place? 100 percent.

LACQUA: I mean, the other question, I've been to the Middle East recently, it's, you know, it is incredible the amount of money that's due a lot of times to the price of oil. If you look at peak oil, and if you look at, you know, the energy transition, when does that change?

CANDY: I think oil and gas will be going for a long, long time whether it's Qatar, Saudi, you know, Abu Dhabi, Bahrain, whichever country you choose, Kuwait. Uh, I don't think that changes. Obviously, everyone's trying to become greener. But even the West, we're realizing the cost of doing that is significant. And maybe we're rushing it a bit too quickly. Obviously, the cost of oil, it's reasonably high still. It's not at its peak, but it's reasonably high. Obviously, that benefits the sovereign wealth funds in the Middle East, so they can invest.

LACQUA: Nick, there's also a bearish case that actually, you know, wage growth in Dubai is just not tracking the higher increases for property prices.

CANDY: I’ve seen that in Hong Kong and Singapore where property prices have grown enormously and wage prices, uh, didn't grow necessarily at the same rate or maintained lower than for a substantial period of time, but they've worked out just fine in Hong Kong and Singapore.

And also, you know, people talk about this 40 percent property price growth in Dubai in the last year or two years or three years, whatever the number is. I was the first person to get £1, 000 a square foot in London. I was also the first person to get £10, 000 a square foot in London, and I got everything in between.

From moving from £1, 000 a square foot to £10, 000 a square foot, it was a 1,000 percent increase. I'm not worried at all at Dubai, Abu Dhabi, Saudi, Bahrain, any of these price increases. 10, 20, 30, 40, 50 percent is nothing compared to where it's going to go. I believe Dubai will hit $5,000 a square foot, regularly. It’s already doing $5,000 a square foot for top villas, top places. But I think we hit $10,000 a square foot. I’ll put my money where my mouth is.

LACQUA: But you're very optimistic on the Middle East as a whole, and especially Dubai. Is there anything that makes you worry about that market?

CANDY: No, not today. Obviously, if the war got a lot more serious in the region, maybe slightly, but even then they're quite immune, actually. They're not going to get involved in the war. I'm not worried about Dubai, Abu Dhabi, uh, I'm also not worried about Saudi Arabia, funny enough, I've been there. They want tourists, and we will want to go there and explore it.

LACQUA: How many properties are you building in the Middle East?

CANDY: So we're looking at a number. We haven't finalized it. We've been there for about two and a half years looking at a lot of deals. And we have a lot of options on the table, and hopefully next time I come back here, we'll be able to talk about some of those.

LACQUA: When you look at the stability of the Middle East, this is something that investors like for the moment, but there's also conflicts or regional conflicts that could impact the region as a whole. Do you worry about that?

CANDY: Yes, there’s conflicts and it’s bad. No one wants to see wars. But there's no doubt for the vision they have for their own countries, forget their, their external investment, the visions that Saudi has for 2030 for Expo, for FIFA World Cup 2034, for the Asian Games in ‘29.

His Highness [Mohammed bin Salman] can't have wars on his doorstep for all this. I believe his vision will be executed. I've been there. I've seen it first hand. It's mind blowing. And, I think the West, we have a different view of some of these wars than maybe they would. So, no one wants wars. They certainly don't want wars.

LACQUA: Well, what are you most excited about in Saudi? Is it the new cities? Would you develop actually, you know, very high-end luxury apartments there?

CANDY: I've not been to NEOM and I've not been to the Red Sea, but I'm a regular visitor to the Maldives. I didn't go this Christmas and New Year, but friends that did had a complete washout. If you go to the Red Sea, the temperature is moderate, so it doesn't have those monsoon seasons. You know, you're going to have the best marine life, 500 times better than Maldives. So every hotel is going to be brand new. It's a part of the coast that's never been touched before. So I think that's very exciting for Saudi. I've not been but I've heard lots of amazing reports. The place I have been is Riyadh, which is Diriyah Gate. And I think Diriyah Gate, out of all the Giga projects that I've read about and seen, will be the one that's executed first. The vision when you go, all you can see is cranes for, miles. And it's the home of the Al Saud tribe, where the royal family come from. So, I think, you know, for them, personally, it's, uh, obviously very important.

LACQUA: Nick, when you look at, I mean, you were one of the original, right, in high-end luxury and you really made a name for yourself in this space. Now, a lot of luxury companies, LVMH with Cheval Blanc, are trying to replicate maybe what you did 20 years ago with different brands. Do you feel like it's becoming a crowded space?

CANDY: I think it's, it is crowded in some ways, but I think there's different brands in the space. And I think that's healthy. When we did One Hyde Park, that was residences at the Mandarin Oriental. Mandarin Oriental is a great brand. I think if you, I mean, Mandarin previously, its number one hotel in the world would have been Hong Kong. Today, its number one hotel in the world would be Dubai. So you know, things change in our lifetime.

I think Cheval Blanc is amazing. They've got five or six hotels in the world today with branded residences. I hate it when these brands, like say Four Seasons go we've got branded residences and there's no hotel next to it and no service. The nearest hotel is like 10 miles away or a mile down the road, whatever. That's not branded residences. That's them just making some money. I believe to be a fully branded residence you have to be linked to a hotel. You have to have a 24-hour service, whether it's housekeeping, room service, whatever you want has to be on, like, there.

LACQUA: But does your job as a real estate developer change? Because do you have to have a bigger connection, for example, with the fashion houses? I think Ralph Lauren is getting into this, Dolce Gabbana is getting into this, Armani is into these residencies.

CANDY: So I think where the brands have designed homes, so you have, Casa Armani or, you know, where they've actually designed furniture, and Giorgio Armani's been involved in the furniture, Ralph Lauren's been in furniture for 50 years. I buy fabrics, textiles, lights from them. So I think that I've got no problems with that. When you, when you've been a brand that's had nothing to do with homes and interiors, but you want to get into it, it's going to take a bit of time. You're seeing car brands that do it today, you're seeing Mercedes-Benz, you're seeing Jacob and Co. watches in Dubai. What does it mean? I don't quite understand what some of those mean. I understand if I've got Cheval Blanc or the Maybourne Group or Ralph Lauren, but what do the others mean?

LACQUA: So, are you able to, you know, put prices up higher in the Middle East compared to London?

CANDY: No, a super prime piece of property in the middle, let's just say Dubai or Abu Dhabi versus London will be significantly cheaper in Dubai or Abu Dhabi.

LACQUA: And this is because what? There's, there's more readily available space?

CANDY: There is. So we are very restricted on supply, planning rules. So, like, if you wanted to build One Hyde Park again today, you're not allowed to build a flat in the city of Westminster bigger than 2,500 square feet. So that's the rule. So any big flat for like 10 000 square feet, you can't build it. It's illegal. If you've got two flats next to each other, that are 3,000 square feet, you want to join them? You can't. It's illegal. So the reason why our property market stays high here in the UK is we have very limited supply. And we can't just knock a building down and build a skyrise. You know, planning is very difficult here. So if you ask me to do One Hyde Park here again today, impossible for me.

Lacqua: Really?

Candy: Yeah, I couldn't do it.

LACQUA: Why?

CANDY: Planning, funding, purchasers, like a lot of these international purchasers don't want to put their names on lists, which are seen by everyone. So a number of reasons. We've made it difficult for the super rich to buy here. They don't want to. So they're still buying, by the way. I'm confident they're still buying. I see it firsthand. But compared to what it was in the early 2000s, it’s a fraction.

LACQUA: Nick, I guess a lot of people are quite angry at the fact that the very high end luxury market means that there are many empty houses of owners. Right, that they have it as a second or third residency. I mean, is this something that comes up?

CANDY: It’s a crazy thing. This is a thing across the whole world. Wealthy people move around. They go on half-term with their kids and go skiing, yes? When they leave their house and go to Courchevel this weekend or St. Moritz, they turn the lights off, okay? I mean, it's happening all over the world. You go to Dubai today and you look at all the towers, not every light is on in every tower. Same in Singapore, same in Hong Kong. It's a, it's a crazy thing, yes?

We got a really hard time on this on One Hyde Park at the time. I stopped listening because it was like, at One Hyde Park, the maximum time everyone's living there is 60 percent. I've still got a penthouse at One Hyde Park. I don't live there. The lights are off. I live in my house in Chelsea. But I still own my penthouse at One Hyde Park.

I love it. But it means the lights are off. It's just wealthy people have got more than one property and they move around. And so that means the lights are off sometimes. But that's common across all markets, if you went to the top houses in Paris today, the top places in New York, the top places in LA, it would be the same everywhere. But the British press love to make a big thing of it.

LACQUA: It’s also a big election year here in the UK, how does that change?

CANDY: I think people, you know, when Jeremy Corbyn looked like he was coming in power last time I was ready to leave the UK. I wired all my money out the UK ready to leave just in case he did come in. And thank goodness he didn't because it wouldn't have been very successful. I think people are less worried this time because Keir Starmer is not Jeremy Corbin and you know, Keir Starmer and his team seem to be engaging with business. I think the two big things that people will worry about is, is there going to be a wealth tax? And number two is, the VAT on private schooling. You know, I went to a private school, but my parents often couldn't afford to pay for me to go to a private school, so my grandma paid the school fees. An extra 20 percent on the VAT would have been a lot for my grandma, probably not affordable.

LACQUA: So, so will that make or break the luxury market, in the UK in terms of real estate? Or is almost immune to anything?

CANDY: I think that in London, the top end of real estate is almost immune to anything. If we had bombs landing here, then maybe, yeah, people would get up and go. But I think London, I think the Cotswolds market is unbelievable, that's very strong. Never seen anything like, so strong down there. And there'll be pockets across the country which are amazing.

LACQUA: But Cotswolds, so I understood that a lot of people moved out during Covid and then actually said, oh, it's a little bit too remote, let me come back to London.

CANDY: So we've got a house an hour and 20 minutes door to door from Chelsea to the Cotswolds. We absolutely love it. Most, most weekends we will try to go down there. We're not away somewhere else. But, uh, I love the Cotswolds. I think it's amazing. And if you ask me that five years ago, I would have said you're mad putting on the Wellington boots going for a walk in the countryside.

LACQUA: Covid lockdown changes everything.

CANDY: Covid lockdown changed, I think it changed us going to the countryside. I think it changed us going to the Middle East. Uh, you know, one of the reasons why people went to Dubai in Covid is it was, it's pretty open. So you could go for lunch, you could go for dinner. Yes, they have very strict rules in place. I think they've benefited from Covid. They've benefited, since then. Also, I would love to have leadership like that in this country, where politics aren't in the way, and they actually make really good decisions and smart decisions fast. The problem is that here, it takes forever.

LACQUA: Well, it's one of the oldest democracies.

CANDY: I mean, that's great. Democracy is great when you've got visionary leadership. And you've got people all working together to get things done. It seems like for the last few years, we've been infighting.

LACQUA: Do you think Labour will do a better job? Is it time for a change?

CANDY: , I'm naturally a Tory. I voted for Tony Blair when he came into power. Um, I think it's, it's probably time for a change. I think all this infighting in the Tories and even now with the talks of, Kemi Badenoch replacing, Rishi by mid-May, with people that have nothing to do with it. British people should know what's going on. And the likes of Dougie Smith and Dominic Cummings, who I've never met, yes, if they think they can just pick and choose who's going to be the next leader of the Conservative Party under their remit, I think it's wrong. And based on that, yes, maybe it's time for some change. But we still don't know the Labour policies, but do I think Keir Starmer is a decent man with good values and good morals? 100 percent.

LACQUA: Nick Candy, thank you so much.

CANDY: Thank you.