How much is it really worth?
Sir Richard Branson bought Necker Island in 1978 for $180,000 — equivalent to US$639,954 (NZ$1.072 million) in today’s money. Eager to purchase his own “virgin island”, he had scouted the 70-acre Caribbean outcrop, part of the British Virgin Islands, when he tried to buy it for just US$100,000. As it was then on the market for US$6 million, his offer was rejected.
Branson ultimately agreed a deal on condition that he built a resort on the island within four years. Since taking ownership, he has poured more than US$10 million into the island’s Balinesestyle complex, which can be rented out for NZ$170,000 a night.
In 2006, Branson estimated the island was worth US$60 million. Now, that figure could be $150 million ($251m) or more, according to John Christie, of HG Christie, affiliate of Christie’s International Real Estate. “It’s probably the most famous island in the world, and because it’s Richard Branson’s island, it’s a trophy for any number of billionaires. For the sort of people who buy private islands, if the stock market goes up or down, they will have enough to get by.”
The value of any island depends on factors such as its location and size, infrastructure and accessibility, whether it has natural water and can create its own energy. “Sale price is dictated by who is in the market to buy,” said Edward de Mallet Morgan, of property consultancy Knight Frank. “It’s rare to find islands that are well located and well looked after, and for sale.” Despite the market turmoil caused by the pandemic, Christie reports that in the past six weeks, the number of inquiries for private islands has quadrupled. “After 9/11, the same thing happened. People were scared and sought a safe haven.”
And if Branson decides to mortgage the island, he would likely have to go to a private bank for a loan using Necker Island as collateral, said broker Paul Mahoney of Nova Financial. “He would have to go to a lender that thinks outside the box. Typically, when unique assets are involved such as this, they will lend not on the value of asset but the value of person.”