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Ghost Floors: Why Billionaires Buy Apartments They Never Visit

• David (Viacheslav) Davidenko

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Dark towers punctuate city skylines worldwide, their empty floors not failures but features of a hidden financial ecosystem. These gleaming skyscrapers in places like New York's Billionaire's Row, Dubai, Hong Kong, and Toronto serve a purpose far removed from conventional housing: they function as "safe deposit boxes in the clouds" for the ultra-wealthy.

When you look up at night and see those unlit floors in luxury buildings, you're witnessing a global wealth preservation strategy in action. These properties aren't meant to house people—they're designed to store capital. For billionaires seeking security, anonymity, and prestige, purchasing a multimillion-dollar apartment they'll never visit makes perfect financial sense. The sources reveal that in some buildings, over 60% of units remain perpetually empty, serving as quiet vaults for international wealth.

Each empty tower tells a slightly different story. In New York, it's about parking money in a stable asset beyond certain regulatory oversight. Hong Kong's dark floors often conceal wealth from mainland Chinese elites avoiding anti-corruption scrutiny. Dubai's vacant luxury apartments signal global status—the ownership itself sends a message of success, no occupancy required. Meanwhile, Toronto's market thrives on speculation through "assignment sales," where units change hands multiple times before anyone takes possession.

The advantages are compelling: privacy through complex ownership structures, potential tax benefits, pathways to foreign residency or citizenship, and the undeniable prestige of owning trophy properties. For developers and local governments, these projects boost GDP and attract investment without the complications of actual residents. The emptiness isn't the problem—it's the point. Next time you see those darkened windows high above the city, don't wonder who lives there. Ask instead: whose money is hiding there?

📰 Read more about this topic in our latest article:  https://sunrisecapitalgroup.com/why-so-many-luxury-skyscrapers-are-empty-the-hidden-economics-of-global-real-estate/

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Speaker 1:

Okay, let's jump into this deep dive. We've got quite a stack here articles, research, notes and they're all pointing towards something, well frankly, a bit strange happening in city skylines.

Speaker 2:

Yeah, all over the world really, you think New York, Dubai, even Toronto.

Speaker 1:

Exactly, and you picture those skylines right At night they're glittering. But, then you look closer and you see these pockets of darkness.

Speaker 2:

Whole floors sometimes, or even entire buildings that just look empty.

Speaker 1:

It is a striking image, isn't it? These huge symbols of wealth and progress just sitting there, dark.

Speaker 2:

And your first thought, naturally, is that they're vacant because maybe the project failed or they're waiting for tenants.

Speaker 1:

That's what you think A flop, basically. But the material we've been digging into it paints a totally different picture.

Speaker 2:

Completely different. It suggests this emptiness. It's not a bug, it's a feature, it's actually intentional.

Speaker 1:

Intentional. These buildings are serving a purpose, often a hidden one.

Speaker 2:

And that purpose? Well, it's not really about housing people or running offices, not in a way we normally think about it. It's something else.

Speaker 1:

So that's our mission here, right To kind of peel back those layers. We want to figure out why build these massive, expensive towers if people aren't living or working in them.

Speaker 2:

Who's buying these places, these multimillion-dollar apartments?

Speaker 1:

And what are they really being used for? Because it feels like it's less about, you know, bricks and mortar and more about something much more abstract.

Speaker 2:

Well, let's get straight to that core idea. The sources really hammer home. They describe these towers not really as homes or condos, but as well something quite different.

Speaker 1:

Yeah, one source had this phrase that really stuck with me New safe deposit boxes in the clouds.

Speaker 2:

Wow, that paints a picture.

Speaker 1:

Doesn't it Not housing Wow, that paints a picture, doesn't it Not housing Storage, but not for your, you know, gold bars or important papers.

Speaker 2:

For wealth itself. The argument is that ultra luxury real estate has become this preferred kind of vault.

Speaker 1:

Exactly A vault for billionaires, maybe looking for security, for anonymity, maybe even for prestige.

Speaker 2:

OK, but how does that work? How is an apartment like a safe deposit box? Usually you use property right or rent it out. How does just owning it act like a vault?

Speaker 1:

Well, the sources lay out a few key factors, and New York City is a prime example. A lot of the focus is on 57th Street in Manhattan. You know Billionaire's Row.

Speaker 2:

Yes, billionaire's Row, those super tall, incredibly skinny towers like 432 Park Avenue, central Park Tower.

Speaker 1:

Those are the ones and the sources. They flat out say these places were never intended as houses per se. They function more like well, like upright vaults.

Speaker 2:

Upright vaults and the occupancy or lack thereof.

Speaker 1:

Well, the numbers are pretty startling. The sources suggest that way over 60% of the units in some of these buildings are either unsold or just sit empty for months, even years.

Speaker 2:

So it's not just a pied-à-terre situation like a place someone uses occasionally when they're in town.

Speaker 1:

It doesn't seem like it. No, it's just empty, because the motivation, according to this analysis, isn't living there. It's not even about rent.

Speaker 2:

It's about parking money millions of dollars in an asset that feels stable, safe from market swings.

Speaker 1:

Or political risks maybe, or even just regulatory oversight they want to avoid.

Speaker 2:

Right, so they buy it and it just sits quietly.

Speaker 1:

OK, so wealth preservation, storage, that's a big driver. But then if we shift focus, say, to Hong Kong, the sources point to something similar visually, you know, luxury towers with those black floors at night.

Speaker 2:

But the emphasis there, according to the material, is slightly different. It's more about secrecy.

Speaker 1:

Egracy, how so.

Speaker 2:

Well, the sources describe these units as secret wealth havens, especially, it seems, for elites from mainland China trying to keep assets out of sight, away from anti-corruption drives, for instance.

Speaker 1:

Interesting. So even if laws are tightening, the suggestion is enforcement might be. Well, spotty is the word used.

Speaker 2:

And here's a fascinating twist in the analysis. One source argues that the more political pressure there is back home, the more valuable these unobserved financial havens become. Exactly the risk itself drives up the demand for this kind of hidden storage. It's not about income, it's about invisibility.

Speaker 1:

And the emptiness helps with that right.

Speaker 2:

Yeah.

Speaker 1:

Less activity, less attention drawn.

Speaker 2:

Precisely Now, let's hop over to another famous skyline Dubai.

Speaker 1:

Right. Dubai, known for pure opulence, home of the Burj Khalifa, world's tallest building, and apparently it has a high residential percentage, something like 77%. You'd think it's full.

Speaker 2:

You would think. But the sources say nope, lots of units there are also permanently empty.

Speaker 1:

So if it's not primarily about living there, what's the driver in Dubai's market?

Speaker 2:

The analysis suggests it's heavily driven by perception, creating a global prestige image. It's less about filling the units day to day.

Speaker 1:

So for the buyers maybe foreign investors, perhaps from emerging economies owning a condo, there is like a status symbol.

Speaker 2:

Yeah, it sends a message of success and international presence, just owning an address in the Burj Khalifa, for example.

Speaker 1:

And crucially, the point is made that the message does not need switches to be flipped or beds to be made.

Speaker 2:

The message is sent just by owning it. It doesn't need to be lived in to signal that global achievement. The value is in the address the asset's identity, not its use as a home.

Speaker 1:

It really shows how detached value can become from actual utility.

Speaker 2:

And it's not just these huge global hubs, is it? The sources also pull in Toronto.

Speaker 1:

Right. Toronto, a city maybe known more for conventional growth, but the same pattern seems to be playing out.

Speaker 2:

Massive development. You mentioned the figure over 1.3 million units being built.

Speaker 1:

Yeah, huge numbers, and alongside that, surging vacancy levels, especially again in that luxury sector.

Speaker 2:

And the sources argue, it's not just that they built too many, there's this other factor speculation flipping.

Speaker 1:

Also called assignment sales.

Speaker 2:

Yeah.

Speaker 1:

Can you break that down quickly?

Speaker 2:

Sure. So basically, someone agrees to buy a condo unit from the developer, often before it's even built Right, but they have no intention of living there or even closing the deal themselves before it's even built Right. But they have no intention of living there or even closing the deal themselves Before they actually have to take possession. They sell the contract, the right to buy that unit, to someone else.

Speaker 1:

For a profit, presumably.

Speaker 2:

Hopefully yes, and that second buyer might do the same thing, sell the contract on again. The sources say units can be bought and sold several times over without ever taking possession.

Speaker 1:

Wow, so it's pure speculation on price increases.

Speaker 2:

The physical apartment is almost irrelevant, it's just the vehicle for the bet and the forces do note this has actually triggered money laundering investigations in Toronto Right and construction keeps going, the argument goes, because the demand isn't necessarily from families needing homes. But from these unknown investors with cash to park who are happy playing this speculative game.

Speaker 1:

Which, I guess, brings us back to that core question, that seeming illogicality why pay millions, tens of millions for a place you never set foot in?

Speaker 2:

It makes no sense if you think of real estate as just a place to live or even rent out.

Speaker 1:

But the sources argue this ultra luxury property, it plays this whole other role for the super rich in today's global economy.

Speaker 2:

Yeah, they outline several key functions, really things that make it very attractive as a place to park capital, not people.

Speaker 1:

OK, let's take through them First wealth concealment how does that work?

Speaker 2:

Well, the ownership structure, the sources explain you can set it up using layers of offshore shell companies. Nominee directors makes tracing the real beneficial owner back well, virtually untraceable, powerful privacy.

Speaker 1:

Got it Okay. Then there's tax avoidance. How does property help there?

Speaker 2:

It depends heavily on the specific country and city, of course, but the sources mention possibilities like maybe lower property taxes if a place is vacant, potentially no inheritance tax when it's passed on, sometimes no capital gains tax when it's sold it can be much more tax efficient than holding other types of assets.

Speaker 1:

Right and another one benefits of citizenship.

Speaker 2:

Yeah, this is interesting. In some countries Portugal and the UAE were mentioned as examples making a large enough real estate purchase can actually expedite residency or even citizenship.

Speaker 1:

So buying the condo isn't just about the asset itself. It's a potential pathway to a new residency or passport.

Speaker 2:

Exactly, it's another layer of value. And then, finally, there's what they call prestige asset parking, just the sheer status of owning certain properties. You know, a penthouse on Billionaire's Row, a suite in the Burj Khalifa. These carry immense international prestige.

Speaker 1:

More so, perhaps, than just having the equivalent cash in a bank.

Speaker 2:

For some individuals. Yes, it's a more visible, maybe even perceived as a more stable statement of global standing.

Speaker 1:

So the sources are pretty clear. Then, for these specific buyers, the apartment itself doesn't need to do anything functional.

Speaker 2:

It just needs to exist, be stable, be quiet, hopefully go up in value.

Speaker 1:

It's not an accident, it's a strategy, part of international wealth planning.

Speaker 2:

Which leads us right to the conclusion that keeps coming up in the material these towers are essentially empty by design.

Speaker 1:

It's their answer to that very common, very understandable question why are we building empty skyscrapers when so many people need affordable housing?

Speaker 2:

And the sources say look, that question, while valid socially, utterly misses the fundamental reality of these specific buildings.

Speaker 1:

They're not built for residents.

Speaker 2:

They're built fundamentally to accommodate capital.

Speaker 1:

And the sources touch on why authorities, might you know, let this happen or even encourage it. These projects boost GDP figures. They generate property taxes.

Speaker 2:

Even if maybe minimized through loopholes.

Speaker 1:

Right and they attract foreign investment, which most places want.

Speaker 2:

And for the developers selling high value units up front to investors who don't intend to live there. Well, it can be simpler than dealing with actual residents long term leases, maintenance issues, rent controls.

Speaker 1:

Yeah, you sell it, move on.

Speaker 2:

So the system as described in these sources, it kind of relies on the building standing empty. It functions as the building stand empty.

Speaker 1:

The emptiness isn't the problem, it's the point A feature, not a bug.

Speaker 2:

It's the market meeting of very specific if niche demand. Privacy over practicality, prestige over actual presence.

Speaker 1:

So, wrapping this up, what's a big takeaway from digging into all this?

Speaker 2:

I think it's the realization that those dark windows you see way up high, they're probably not a sign of failure.

Speaker 1:

Not a failed project.

Speaker 2:

No, more likely. They're a quiet, visible marker of a very successful, very global financial strategy using ultra luxury real estate to store, to hide, to protect, maybe even flaunt wealth, all hidden in plain sight.

Speaker 1:

So the next time you're looking up at one of those gleaming towers at night and it seems strangely dark.

Speaker 2:

Don't just wonder who lives there.

Speaker 1:

Based on these sources. Maybe the better question to ask yourself is whose money is this hiding?

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David (Viacheslav) Davidenko

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