For Immediate Release
Citigroup Inc. (NYSE: C)
March 23, 2009

2009 Knight Frank/Citi Private Bank Wealth Report

highlights

The 2009 edition of The Wealth Report, the third such collaboration between Knight Frank and Citi Private Bank, indicates that luxury house prices have fallen around the world, but super-rich appetite for property remains undimmed.

Key highlights:

  • The latest results from the Knight Frank Prime International Residential Index (PIRI) show that just under 50% of the locations featured managed to record positive price growth on an annual basis in 2008. By the final quarter, however, price growth had either stalled or fallen in 75% of locations.
  • There were wide variations in performance. Hong Kong saw the sharpest annual drop (-24.5%), but prices for residential properties in Bangkok rose 22.5%. Additionally, some previously buoyant markets have turned very quickly. Dubai, which recorded an annual overall growth of almost 11%, saw prices fall by 19% in the last quarter alone.
  • According to PIRI, prime property in Monaco is the most expensive in the world costing an average of €55,000 per square metre for the best properties. London and Manhattan are placed second and third.
  • The first Knight Frank World Cities Survey illustrates New York and London are likely to remain the world's leading financial centres, but Asian cities are catching up. In the same survey, London takes poll position for global influence by securing top-five positions in four key ranking criteria – "economic activity", "political power", "knowledge & influence", and "quality of life".
  • Despite house price falls, the Knight Frank/Citi Private Bank Attitudes Survey shows that almost 55% of High Net Worth Individuals (HNWIs) plan to increase their exposure to residential property over the next two years
  • Global farmland prices started to slip last year on the back of falling commodity prices, but remain more resilient than residential or commercial property, according to preliminary findings from the Knight Frank Global Farmland Survey. Exchange rate fluctuations mean affordability in some countries has increased for US dollar and euro-backed buyers, despite strong price increases in local currencies.

Liam Bailey, head of residential research at Knight Frank, commented:

"The Wealth Report, produced in conjunction with Citi Private Bank, is released at an opportune time. Covering a period of global wealth destruction rather than creation, the report's annual analysis of prime residential property markets and the behaviour and attitudes of the wealthy has become even more relevant.

"Even the world's richest people have cut their discretionary spending and most desirable prime residential property markets have now been affected by the global downturn. Although almost half the locations in Knight Frank's Prime International Residential Index managed to show a positive overall return in 2008, price growth had either stalled or started to decline in nearly 75% of them by the end of the final quarter.

"However, despite house price falls, the rich are committed to property as an asset class and the results of our Attitudes Survey, which represents the views of a cross section of Citi Private Bank's wealthiest clients, reveal that 55% plan to increase their exposure to residential property over the next two years. In turbulent times the wealthy want their investments to be both tangible and transparent.

"This year's Wealth Report also takes a timely look at the shift in economic power to the Asian financial centres. Despite this mounting challenge from the East, the new Knight Frank Global Cities Index concludes that London and New York are likely to retain their global dominance."

The 2009 Wealth Report includes the following new research from Knight Frank and Citi Private Bank

  • 2008 Prime International Residential Index
  • Knight Frank/Citi Private Bank HNWI Attitudes Survey
  • Knight Frank World Cities Survey
  • Knight Frank Global Farmland Survey

Knight Frank LLP
Knight Frank LLP is the leading independent global property consultancy. Headquartered in London, Knight Frank and its New York-based global partner, Newmark Knight Frank, operate from 196 offices, in 38 countries, across six continents. More than 6,770 professionals handle in excess of US$700 billion (almost £355 billion) worth of commercial, agricultural and residential real estate annually, advising clients ranging from individual owners and buyers to major developers, investors and corporate tenants. For further information about the Company, please visit www.knightfrank.com.

Citi Private Bank
Citi Private Bank, one of the largest private banking businesses in the world, provides personalised wealth management services for clients through 90 offices in 32 countries. Citi Private Bank offers unmatched global reach, coupled with a full range of portfolio management and investment advisory services, an array of structured lending and banking services, as well as expertise from Citi Institutional Client Group. Citi Private Bankers act as financial architects, designing and coordinating insightful solutions for individual client needs, with an emphasis on personalized, confidential service. Citi Private Bank provides services and products through various Citi affiliates. Not all services and products are available at all locations. Citi Private Bank was ranked number one in both North America and Latin America, and number two in Asia by the 2009 Euromoney Private Banking Poll. The Firm was also awarded a number of leading positions in the EMEA region.

The 2009 Wealth Report
The 2009 Wealth Report is the third collaboration between Knight Frank and Citi Private Bank, market leaders in high-value property consultancy and wealth management respectively. In the report our expertise in the property and financial sectors has been combined to provide insight into the wealthy and their relationship with the prime property sector.

The report provides a comprehensive analysis of the prime global residential markets. We look at the importance of residential property as an asset class and report on pricing trends across the global prime residential market and look forward, with the aid of market-leading thinkers and commentators, at the big trends set to impact on the property markets in the future.

The Knight Frank Prime International Residential Index (PIRI)
The Knight Frank Prime International Residential Index (PIRI) is the only index that tracks prime residential property markets across the globe. Data is based on a selection of residential properties in prime market locations, which are valued on a structured basis, capturing changes in capital values, rents and yields. A total of 55 locations are included in this year's index. All prices are captured in local currencies to remove the impact of currency change on our calculation and price growth.

The Knight Frank/Citi Private Bank Attitudes Survey
The Knight Frank/Citi Private Bank Attitudes Survey is an online survey completed by a global cross-section of Citi Private Bank's wealth managers representing around 2000 of the world's richest people. Respondents are asked to consider the behaviour and attitudes of their clients in relation to investment activity, property ownership and philanthropy, both historically and in the future.

The Knight Frank World Cities Survey
The Knight Frank World Cities Survey assesses 40 of the world's leading major cities based on four criteria – economic activity, political power, knowledge and influence and quality of life – to determine their overall position within the hierarchy of global cities.

The Knight Frank Global Farmland Survey
The Knight Frank Global Farmland Survey uses official indices, where available, to track the performance of farmland values across the world. Where no official statistics are available the most reliable local sources are used.