America: Land of the Super Rich, From Sea To Shining Sea

If American states were viewed as countries, Texas would have the ninth wealthiest population in the world. Photo: NETarrantMan

“Rushing to Cater to America’s Rich” was the headline of an article last year in The New York Times about luxury brands turning their focus back to the United States after nearly a decade of adoration for the BRICs (Brazil, Russia, India, China) and other high-growth economies in Asia, Africa and the Middle East.

A significant portion of the estimated $73.3 billion in luxury buying is done by the 74 million foreign visitors America attracted last year. Yet European luxury marketers also have started to again take notice of U.S.-based wealthy consumers.  That’s because despite the growth of wealth in many places around the globe, America is still home to more of the very wealthy than any other country.

However, that’s just the beginning of the story.  While it is often assumed that American wealth is limited to the two coasts and hot spots such as Dallas, Houston and Chicago, the truth is households of Ultra High Net Worth (UHNW, or net worth of at least $30 million) are far more geographically diverse than one might imagine.

When we hear or read about the Super Rich in the news, it typically is about entrepreneurs in China, Silicon Valley tech wizards, Oligarchs in Russia, Sheiks in the Middle East and Wall Street finance kings. However, data from researcher Wealth-X shows there are more UHNW households in Ohio (1,505) than in Saudi Arabia (1,495); more in Minnesota (1,285) than Russia (1,230); more in Tennessee (1,145) than Kuwait (845).

Another New York Times article on buyers in One57, a new luxury skyscraper in Manhattan where the average unit sells for $29 million, reported that while all the aforementioned types of titans are tenants, the building also has attracted a car dealer from Minnesota, a farmer from Iowa and a vitamin king from North Dakota.

For travel agents and suppliers of luxury products and services, the data should be a cause for pause. Virtually every state has some super-successful business owners that have figured out a new way to make widgets and made a fortune.  This is backed up by data from the National Business Aviation Association, the trade group for private jet owners; its members fly to some 5,000 airports across the United States each year. It has members based in all 50 states.

So let’s look further at the Wealth-X data: Slicing the numbers from the 2014 World Ultra Wealth Report reveals that if American states were viewed as countries, 23 of the top 50 Super Rich populations would be states. Ranked alongside countries, California would be third in the world (full chart below), New York number 6, Texas number 9 and Florida number 12, followed by Illinois (17), Michigan (19), Pennsylvania (21), Ohio (23), Massachusetts (27), Wisconsin (28), Connecticut (31), Maryland (32), Virginia (34), Minnesota (35), New Jersey (36), Washington (39), North Carolina (41), Georgia (43), Tennessee (44), Colorado (45), Indiana (47), Arizona (48) and Oklahoma (49).

Clearly, there are significant pockets of the Super Rich in the so-called “fly over” states. Making the point, Illinois ranks ahead of Italy (18) in UHNW population, Michigan ahead of Spain (20), Ohio in front of Saudi Arabia (23), Minnesota ahead of the United Arab Emirates (37) and Oklahoma ahead of Turkey (51), Indonesia (52), Malaysia (53), Kuwait (56) and South Africa (57).

Using private jet travel as a measuring stick to find wealthy consumers (after all, private jet flights run $5,000 to $20,000 per hour) and looking at the network of some of the largest operators of private jet terminals (FBOs) again substantiates that there are very rich people coming and going from places other than West Palm Beach, Palm Springs and London. Signature Flight Support, which operates over 200 terminals worldwide, has locations in Austin, Mobile, Nashville, Bozeman, Des Moines, Green Bay and Omaha; Atlantic Aviation operates FBOs in Bakersfield, Cleveland, Elmira, Birmingham (AL) and Casper. Among Million Air’s 30 locations are San Antonio, Indianapolis, Tucson, Topeka and Yuma.

For hotels looking to fill expensive suites, tour operators marketing five- and six-figure experiences, and cruise lines adding increasingly lavish accommodations, this means potential customers are in markets you may not have been thinking about. For savvy travel agents looking to build their business, it also means you don’t have to be in Beverly Hills or Greenwich, CT, to tap into the high-spending of the Super Rich.

Super Rich Ranked by Base

Source: Wealth-X

Doug Gollan is the co-founder and editor of DG Amazing Experiences, a weekly e-newsletter for private jet owners, and is a member of the Travel Market Report management board. His experience catering to the wealthy includes founding Elite Traveler, a magazine distributed on private jets, launched in 2001, which he sold his interest in 2014. Before that he worked in various editorial, sales and management positions for Travel Agent Magazine for 14 years. He is a CTC and a member of The Luxury Marketing Council. His blog Douggollan.com covers news and trends about selling and marketing to the Super Rich.  He is currently working on his third book “Sales Superstars:  Secrets of Selling to the Super Rich.”