Asia's wealthy families reconsider Dubai investments amid Israel-Iran war
What's the story
Asia's wealthiest families are having second thoughts about their investments in Dubai, as the ongoing Iran war shakes the city. The conflict has raised concerns over its stability and safety. Many clients have reached out to consultants, asking for ways to delay their relocation plans or reduce their investments in this once-secure region.
Investment reassessment
Investors rethink Middle East moves
Nick Xiao, CEO of Hong Kong-based multi-family office Annum Capital, said Asian investors who had moved to the Middle East for investment opportunities and tax advantages are now reconsidering their decisions. Many are even thinking about moving their money back to Hong Kong or Singapore. This comes as the US-Israeli war with Iran intensifies and countries like Saudi Arabia and Bahrain face renewed attacks.
Economic impact
Dubai's appeal amid the conflict
Despite the ongoing conflict, Dubai has continued to attract global wealth. The UAE is among the fastest-growing booking centers for financial assets, with an estimated $700 billion from overseas investors booked in 2024, according to Boston Consulting Group. Asian wealth has been a major contributor to this growth, with about a quarter of the over 2,270 foundations set up in the UAE having Asian ownership.
Family concerns
Desperation leads to drastic measures
The ongoing war has forced many Asian families to reassess their decisions. Felix Lai, principal of Hong Kong-based multi-family office JMS Group, said it's a wake-up call. Some clients are so desperate to leave that they've hired private jets at exorbitant costs. Despite preparing for occasional disruptions in the Middle East before moving, hearing explosions and watching drones being intercepted mid-air have forced a review of their decisions.
Business implications
War's impact on Dubai's business landscape
The ongoing conflict has also impacted Dubai's business landscape. Patrick Tsang, founder of the Ambassadors Club in Hong Kong, said the city's reputation could take a hit from a prolonged war. This may prompt some expats to leave, similar to how many left Hong Kong after pro-democracy riots years ago. However, despite these challenges, some investors and residents believe that the UAE's strong infrastructure and governance will help it recover from this crisis.