The logic of an empty US$100m New York pad

New York

FOR most investors, a diversified portfolio means a prudent mix of stocks and bonds; for the global elite, diversification increasingly means splurging on New York apartments that can cost tens of millions of dollars, or more. Across Manhattan, real estate developers are scrambling to meet surging demand from buyers around the world who are prepared to pay record-setting prices for new developments with opulent finishes and extraordinary views.

These buyers - some of whom obscure their identities through webs of shell companies - are not all rushing to call the Big Apple home. Instead, many of them are paying record prices with the expectation that their investments will appreciate, even as they sit empty for most of the year.