Farhad Vladi is the founder and owner of Vladi Private Islands.
Farhad Vladi was born in 1945 in Germany and raised there. His father was Iranian and his mother was German. His brother Firuz Vladi is a geologist. Both are the grandchildren of businessman Hasan Vladi, who, like his father, brought carpets, leather and licorice to Hamburg.
After graduating from the University of Hamburg in 1967, he received his Ph.D. in economics from the University of Vienna.
On March 14, 1971, he sold his first island, Cousin, in the Seychelles. To date, the number of buyers to whom he sold islands has reached 2,000.
Farhad Vladi: “We founded the market for the sale of private islands”
Owning a personal island has traditionally been considered one of the attributes of the life of millionaires, billionaires and celebrities. The founder of the industry, Farhad Vladi, spoke about the formation of the market for private islands, the cost and features of purchasing properties.
Mr. Vladi, at the moment you are the head of Vladi Private Islands, which has specialized in the sale of private islands for 50 years. Tell us, how did it all start?
– I first sold a property in 1971 and thus established a new market for the sale of private islands around the world. It all started with the fact that I collected all the photographs of properties available to me at that time, and sent them to the wealthy residents of Hamburg. To create an impromptu customer base, I had to study the newspapers of the time. And then one day a young man called me and said that he was interested in the offer, he also added that two more of his friends want to participate in the purchase of the island.
But before continuing, I would like to share one more interesting story. You probably know the story of Robinson Crusoe. I was presented with a gun that belonged to the archetype of Daniel Defoe’s character, Alexander Selkirk. It is known that the weapon was in the possession of the Scotsman in 1709 during his stay on the island.
The relatives of the man whose life story formed the basis of the novel still live in Scotland. One day, a representative of the family, Helen Jardine, came and handed me the gun with the words: “My mother gave it to you.” In time, I plan to transfer it to the Edinburgh Museum, where it should be.
How did you manage to find suitable islands and make your first sale?
– Since it was initially a difficult task to determine the location of the islands, I armed myself with all kinds of maps. However, it turned out that not all of them contained comprehensive data about the properties of interest to me. So I decided to take up the study of nautical charts, which were made with more detail. It was these maps that were of particular interest, because sailors are forced to pay attention even to underwater rocks in order to avoid damage to ships while sailing.
I also rented a plane, hired a pilot, and started exploring the coastline. At first, it was extremely difficult to distinguish a private island from a state one. Over time, islands with houses or other buildings became my main goal. I noticed an important detail – as a rule, buildings are erected on private islands. But if there are no houses on the island, and a lighthouse can be seen from afar, it is definitely a property owned by the State.
My search was crowned with success, the owner of one of the islands, who at the time lived in France, agreed to sell the property, and I, in turn, resold it to the new owner. This was the beginning of a new industry, and by 2014 we had sold 2,560 islands. Currently (2020) there are more than 3 thousand of them.
You clearly distinguish between private and public islands. Why is this distinction critical to your business? And what is the origin of the term “private islands” itself?
– The fact is that my company deals exclusively with the sale of private islands. States are not interested in trading assets of this kind, therefore this part of the market is outside the sphere of our interests.
I can say with confidence that we are the first to introduce the concept of “private islands”. This detail can be re-checked with the help of old dictionaries – until 1970 there was no such term in them. You can find it only in later editions dating back to 75-76 years. At that time, we had already managed to develop our own work. In everyday life, there was a related concept, “individual islands”, but the term “private islands” was introduced by us. Also, the industry, as such, did not exist so it would be appropriate to say that we also created the market for the sale of private islands.
Is there an internal classification of private islands?
– There is even a book in which we classified the islands. The bottom line is to group the islands according to the category of specific properties on them – castles, lighthouses, runways. A separate type of islands are those that have residences or resorts. Buyers may have a special interest in islands previously owned by celebrities, atolls (safe zone in the ocean) and treasure islands. In specific categories, we also included the largest or smallest islands in the world and properties with territories that include lakes or rivers.
There is another interesting variety of properties – self-sufficient islands. These are the ones that have enough drinking water and provisions.
Your client – who is he?
– There is a widespread myth that only extremely wealthy people can become our clients. However, I authoritatively declare that in the modern world, anyone capable of buying a car can become the owner of their own island. A middle class car can be purchased for about €50 thousand. For the same money, I can offer you an island in Canada or Finland. As you can see, you don’t need to be fabulously rich to become the owner of your own piece of land surrounded by water.
– However, I authoritatively declare that in the modern world, anyone capable of buying a car can become the owner of their own island. A middle class car can be purchased for about €50 thousand. For the same money, I can offer you an island in Canada or Finland.
Clients from which regions contact you most often?
– My business is a long-established network. Since we are based in Germany, we have many German-speaking clients. We often work with Americans and Europeans. We have several clients from the post-Soviet countries, however, there are not many of them – two or three owners of small islands. Nonetheless, we are expanding our horizons.
Let’s imagine that there is a client interested in buying an island, what is your interaction algorithm with him?
– There are three primary aspects that you should pay attention to when working with a new client. These are the regional and climatic preferences of the buyer, as well as his budget. In this context, only a guideline is needed, and not a designation of a specific amount of money. By understanding the range of possibilities of the client, and knowing the limits of acceptable cost, it will be easier for us to choose the best option that suits the buyer.
Another important aspect is the motivation of the person who comes to me.
The buyer can be motivated by anything. Perhaps he wants to build a hotel on the island or acquire a secluded place to spend time with family and friends. Even if the client wants to purchase a property in order to pitch a tent in the middle of the island, his wishes must be taken into account.
I would like to note that, when visiting the property for the first time with the client, I recommend for him to make a trip to the designated place on his own, by boat. A person needs to feel these emotions.
For example, a client has already decided which island he wants to purchase. What should he do next?
– It must be ensured that the client’s plans to build a house or any other intentions regarding the internal infrastructure of the island are feasible. At this stage there is a visit to a lawyer who will draw up a contract.
Depending on the agreement with the seller, the due diligence procedure can be alloted from 30 to 90 days. Suppose that the contract was signed for 90 days, during which time the buyer can legally do whatever he wants with the island – including checking the name or clarifying all the nuances associated with construction on the site. This is a very important stage. At the agreed time, the buyer can consult with architects or make inquiries and find out that, for example, there is a bird cemetery on the island, because of which the construction of any structure is impossible. Thus, the client gets 90 days to explore all corners of the island and, if necessary, cancel the deal. If the outcome is favorable, after the allotted time, the buyer must come to us and declare that he is satisfied with the property and is ready to close the deal in 30/60/90 days.
The buyer can also visit the island before signing up a contract, but there is a risk that by the time he gets there, the latter will already be sold. That is why, if one of my clients is interested in exploring and buying the island, I contact the owner and ask him to keep the reservation for the next two weeks.
What questions do new clients most often ask you?
– I will note a funny trend that I noticed when communicating with the families of new clients.
Men often think that they are immortal, that they don’t care about anything. But the woman will immediately ask: “Mister Vladi, where is the nearest hospital?” If I say that it may take several days to get to the nearest hospital, no one will buy the island. Despite all the delights of life on the island, one should not forget about the risks of human injury. In addition, a situation may arise in which a person needs emergency medical attention. That is why I always provide proof that the trip from the island to the doctor’s office or hospital door will not take more than 90 minutes.
In general, I have heard completely different questions from my clients. Here are some of them: How can I make money on the island? Is swimming dangerous? Are there fish in those places? What about sand fleas? All these questions are natural. It is important not only to discuss everything, but also to visit the island before buying in order to see everything with your own eyes. In addition, people are often interested in the investment component. In this case, people often ask whether the sale of the island will be profitable, for example, in 10 years.
In some countries I am asked questions about expropriation. For example, is there a risk that the island might be requisitioned? In this case, I suggest that the client protect himself and take out insurance in case of expropriation.
What are the specifics of real estate construction on the islands?
– Since all structures are delivered to the island and assembled onshore, the total cost of construction increases by 10-15%. In many countries, frame house technology is used. It means that the assembly of the property is made from pre-prepared parts, sections and blocks. So, parts of the house are installed on a platform attached to the helicopter. It delivers parts to the island. There is nothing special in this process, but additional transportation costs must be taken into account.
Buying private islands is traditionally considered an attribute of the life of millionaires and celebrities. Have you had any experience working with any of them?
– Of course, there are islands that we sold to famous people, for example, one of the owners of the Red Bull GmbH company.
Johnny Depp purchased an island in the Bahamas. The actor decided not to carry out construction work on his property. I talked with his assistant about the construction and subsequent lease of the house to our company, but was refused. Depp comes to the island on a yacht, leaves her at the shore. He is known to spend his vacation enjoying food, sleep and the island itself. And when the holidays are over, the island remains untouched, there is not even a home on it, and therefore there is no need for a caretaker. So, the actor manages to avoid any maintenance costs.
When it comes to renting private islands, we even had clients like Bill Gates. Initially, we did not know that the head of Microsoft wanted to rent one of our islands, this became known only after the fact. His lawyer contacted us and said that it was necessary to rent the island for two weeks.
The treasure islands you mentioned earlier are quite an intriguing topic, let’s expand on it in more detail. Have you ever sold this kind of island? What are the specifics of such sales and will the value of the property increase if there are rumors that a treasure is hidden on the island?
– I’ll tell you a story about the sale of a treasure island. It was at one of the Berlin exhibitions. I prudently installed a poster with information that one of the properties can be purchased at a price of $250 thousand. Soon, a gentleman came up to me and said: “Listen, you’re not really selling this island for $250 thousand, because its real value is $1 billion.” The man also asked if I knew that there was treasure there, the presence of which, in his opinion, should have a significant impact on the value of the island. I suggested that the gentleman buy the island for $250,000 and go on a treasure hunt. He said that he did not have such a sum. We talked a little more, and then said goodbye, but I decided to check the information I received from him.
It turned out that there is an island in the Pacific Ocean called Isla del Coco (Coconut), which is a territory of Costa Rica. There have long been legends that the largest treasure is hidden on it. About 40 search operations were carried out, but the treasure was never found. Therefore, everyone decided that a mistake was probably made and the treasure is on an island located on the Panamanian side.
Later, I sold this island to a London lawyer and asked if she would like to check the presence of the treasure in her possession.
With regard to treasure islands, I always follow the strict rule – never give conflicting information about treasure before signing the documents and only after all the legal issues have been settled, I can mention the rumors in this regard. The presence of rumors about treasure does not affect the value formation. Otherwise, I would look like a swindler.
How is pricing in the private island marketplace?
– The islands have a peculiarity thanks to which this specific market can only be compared with the art market. When buying a condominium, it is customary to build on the footage, but, for example, in an art gallery, paintings by artists are not estimated in square meters, and the amount of paint spent on a work is not taken into account. When calculating the cost of art pieces, a lot of nuances are taken into account. The same logic applies to islands. When I need to assess an island, I pay attention to many details – the presence of hills, vegetation, beaches, building permits, proximity to the mainland, as well as the cost of existing buildings. If at the same time I understand that all the necessary nuances speak in favor of the property, I am ready to pay more. In this case, the final decision always rests with the client. Of course, there are sellers who overestimate the real value of the properties, therefore we offer our clients only those islands, the cost of which, according to our estimate, is reasonable.
Let’s be a little more specific about the value of the islands, taking into account different pricing factors in the market and region.
– In one of the old newspapers I came across an article in which it was stated that the island could be bought for 5 thousand German marks. It was a long time ago, nowadays such a modest amount is not enough. If we assume that we are talking about buying a property located in the Caribbean Sea, intended for spending time with the family, the buyer should have an amount of $500 thousand to $1.5 million. And, for example, the estimated cost of an island with a good beach in Panama is from $250 to $300k
In the Bahamas, I have offers ranging from $10 to $12 million. One of these islands is owned by Richard Branson, founder of the Virgin Group. Recently, the value of the islands has increased significantly. If we speak, for example, about Grenada, then we’ll be talking about a price of $2 million.
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You have a pretty specific job, but what about a hobby. What do you do in your free time?
– My hobby is in tune with my work – I really like old maps. Here, for example, the very first map, dated 1554, does not yet have Australia on it. At those latitudes, there was still no hint not only of Australia, but also of New Zealand.
It is known that a certain Martin Waldseemüller, fellow countryman of Sebastian Munster, the famous German geographer, drew this map together with Amerigo Vespucci. Despite the fact that Martin prepared a very apt description, America at that time was drawn in the form of a banana. The name of the map featured Vespucci’s name and it is believed that America was “born” thanks to a guy studying old maps. The original copy of the map was sold at auction about five years ago, it cost $10 million. This is the most expensive map in the world. It was acquired by the American government as the continent’s “birth certificate”.
Do not forget that the people who made the first maps had no satellites, no aircraft, no drones. They managed to draw a map just by sailing a boat.
You also own an island. What prompted you to buy an island for yourself?
– At some point, I decided that my own island would allow me to find not only a separate world, but also enjoy peace. I really appreciate the contact with nature, because it is in such moments that I feel like a happy person. Also, I really love books about treasure hunting and consider the islands a special place.