Russian investing Real Estate in London

Early this year, one of the most exclusive and expensive houses in London changed hands. A Russian billionaire put in a £41m bid for a house on Billionaire's Boulevar, where just the running cost of a house is £250,000 a year.

Leonard Blavatnik, the Russian oil tycoon, became the new resident of the Kensington Palace Gardens. He is the latest to reinforce the Russian billionaires club in London, which has grown almost imperceptibly and inow carving out a significant power base. Blavatnik is not unknown in Britain. He brokered a joint venture in 2003 between BP and TNK that landed him and two other Russians a $2.6 billion windfall.

Nor is he the only one to splash out on London property: in recent months London has become the city of choice for the new generation of Russian billionaires. Th trend was started in the mid 1990s when Artiom Tarasov, famously the first man who became a millionaire in the wake of perestroika, then becomng the first to flee as a result. He was followed by Boris Berezovsky.

Oil Barons

The Sunday Times reports that the Russian oil barons are the new big names in Britain. They are also the best known, starting with Abramovich, chairman of Sibneft; Mikhail Friedman of the Alfa Group, who is thought to be considering a partial float in London; and Vagit Alekperov of Lukoil.

In London, business services, such as lawyers, accountants, estate agents and advisers, are gearing up to answer the demands of wealthy and influential Russians who are choosing London as their home and business base. For most Russian tycoons, london is attractive due to its position at the centre of global markets, particularly those in natural resources. Russia's first female billionaire, Elena Baturina, the owner of the construction group Inteco, is also said to have increasingly strong ties with London, particularly with British investors. Her husband is thought to have some real estate interests in London.

One small private firm in London said: In the last 12 months there has been a significant increase in demand from Russians wanting to check out British companies and businessmen for potential opportunitities.