The Global Empire of a Tiny Country
Qatar’s diverse $335 billion in investments around the world
7–4–17, Adil (written 7–8–17)
Qatar is a country with a population less than that of Houston, at 2.2 million. However, it is also the richest country in the world per-capita. As you might guess, all this wealth comes from underground — Qatar is the world’s largest exporter of natural gas. In 2005, the Qatar Investment Authority (QIA) was created to control Qatar’s highly diverse global assets, spanning real estate, tech, sports, travel, luxury, and more. In sum, the $335 billion empire makes it the 11th or 14-largest sovereign wealth fund in the world (CNBC said 11th, Bloomberg 14th).
Here is a map of countries where Qatar has major investments:
Not bad for a country so small you can’t even see it on the map. Here’s an interactive link to explore that map and read the specific investments in each country, though it’s in French.
So, what are some of these international assets?
- For starters, the QIA owns more property in London than the Queen of England. UK investments were valued at a minimum of $35 billion in 2014 (which is now a big underestimate after big 2015 purchases). This is staggering: when looking at the top 15 most expensive London skyscrapers, 34% of it is owned by Qataris (for comparison, UK companies own 21%). As Bloomberg reports, “In the swankiest parts of London, it’s possible to exclusively live, work, shop and stay in Qatari-owned properties. A Qatari-led group bought London’s Canary Wharf in 2015, expanding Qatar’s collection of London properties that includes stakes in London’s Savoy Hotel, the Shard skyscraper, Harrods department store, the Olympic Village and HSBC tower. Qatari Diar, the QIA’s real estate development unit, is converting the U.S. Embassy on London’s Grosvenor Square into a luxury hotel, and is building homes at the former Chelsea Barracks.” UK investments aren’t limited to real estate — the QIA also has a 20% stake in London Heathrow Airport and another 20% stake in the company that owns British Airways.
- Elsewhere in Europe: Qatar invested billions in Barclays Plc and Credit Suisse Group AG during the 2008 financial crisis. In 2014, royal family member and former Qatari Prime Minister Jassim bin Jabr Al Thani bought up a cool $1.85 billion in shares of Deutsche Bank. Drive a Volkswagen? Yeah, the QIA is the biggest shareholder in Volkswagen, too. Italian luxury brand Valentino — also owned by Qatar. Still too bougie for you? Fear not, Qatar also owns 10% of Western Europe’s largest department store owner, Spain’s El Corte Ingles SA. Qatar Sports Investments even bought the soccer club Paris Saint-Germain (PSG) in 2011, just before the team won four French soccer league titles with star players including David Beckham. From 2011–2016, Qataris also sponsored arguably the best soccer team in the world, Barcelona, which is why their jerseys looked like this:
And in line with their weird obsession with airports, Qataris also own 25% of the St. Petersburg Airport in Russia.
- USA: Traditionally more heavily invested in Europe, Qatar branched out even further with their announcement that they plan to spend $35 billion in the US by 2020. In 2014, they were the 4th-biggest investor in US office space, primarily in NY and LA. In NY, Qatar now claims a 10% stake in owners of Empire State Building. On NY’s far west side, there is a nearly $9 billion redevelopment plan… and Qatar owns 44% of that, too. In LA, Qatar acquired Miramax studios, formerly owned by Disney. This is the film company that owns movies such as Oscar-winning Pulp Fiction (though my brief perusal indicates this is by far the company’s biggest success). And now there are big plans to expand to SF, where the QIA plans to open an office to invest in Silicon Valley. This includes tossing some dollas towards Uber, so you can tip your hat to the Qataris next time you hop into that car.
- Asia: Qatari natural gas funds a massive chunk of the electricity in Hong Kong, Japan, South Korea and Taiwan, but there isn’t as much investment there yet. In 2014, Qatar announced plans to spend up to $20 billion in Asia over the next six years, expanding offices in New Delhi and Beijing. In Singapore just this past June, Qatar spent $2.5 billion in purchasing Asia Square Tower 1 from Blackrock. This was the largest office transaction in Singapore’s history. To cover their Asian shopping needs, the QIA also bought stakes in another huge department-store operator (Qatar is now the second largest shareholder in Lifestyle International Holdings Ltd). Y’all might have heard of Li Ka-shing, aka the second richest person in Asia and the 18th richest in the world with a net worth over $30 billion (with a name that is literally “ka-shing,” how can you not be filthy rich?). I only know him because he is apparently a long-time supporter of Stanford, and Stanford Med is housed in the “Li Ka-shing Center for Learning and Knowledge.” Well, Qatar owns 20% of his electric utility company. To finish off this slew of crazy numbers: “[QIA] is also planning to set up a $10 billion investment venture with China’s Citic Group and is considering investing in a $100 billion global technology fund formed by SoftBank Group Corp. and Saudi Arabia.”
And for the sake of inter-fact connections, the QIA also has a 12.99% stake in the Agricultural Bank of China, which has a neat story of its own.
None of the above even touches on their obvious billions invested in oil and gas around the world.
As a semi-side note: Undoubtedly because of the money, tied with Qatari investors’ love of sports, Qatar won the bid to host the 2022 World Cup (which is currently a huge mess with human rights violations). By some estimates, the tournament will cost the country an inconceivable $220 billion (60x what South Africa spent on the 2010 edition). I’m not sure how that number has evolved, but if you look at just infrastructure alone, the recent 2017 estimate from Qatar puts the bill at $8–10 billion (half the original proposal). I got no idea how much it costs to run the rest of the tourney, but I doubt it’ll be cheap to bring the world to Qatar. Hopefully Qatar won’t have to continue paying migrant workers $1/hour to sit in stadiums and pretend to have fun.
Gotta ‘mire the country’s diversified investment strategy though — literally owning huge chunks of some of the world’s most famous skylines, plus German car manufacturers, Italian luxury brands, French soccer teams, American tech companies and movies studios, Chinese banks, a handful of airports, and more… not too shabby.
PS: when I’m in the Doha airport today, I’ll report back about how snazzy it is 👌🏼.