“The idea of putting physical metal in a safe jurisdiction like Singapore with parties they can trust is becoming a big trend nowadays,” says Gregor Gregersen, founder of The Reserve.
Alessia Pierdomenico | Bloomberg | Getty Images
The ultra-wealthy are increasingly moving their gold offshore as economic and geopolitical uncertainty roils markets — and Singapore is emerging as a favored destination.
Not far from the city-state’s airport sits a six-story facility covered in onyx and fortified by tight security. Tucked behind its steel doors are gold and silver bars amounting to about $1.5 billion.
Known as “The Reserve,” the storage facility features scores of private vaults and a towering storage chamber lined with thousands of safe deposit boxes reaching three stories high.
From the start of the year to April, the precious metals repository has received an 88% increase in orders to store gold and silver in the vault from the same period in 2024, said its founder, Gregor Gregersen. The Reserve, which also sells gold and silver bars, saw sales for precious metals bars skyrocket 200% year on year in that time, data provided by The Reserve showed.
Singapore is viewed as the ‘Geneva of the East’; it has a reputation as a safe jurisdiction with relative political and economic stability.
A growing sense of unease is driving the surge, according to industry watchers.
“A lot of very high net worth clients are looking at tariffs, looking at the world changing, looking at the potential of geopolitical instabilities,” Gregersen told CNBC.Â
“The idea of putting physical metal in a safe jurisdiction like Singapore with parties they can trust is becoming a big trend nowadays,” he said, adding that 90% of the new orders are coming from outside of Singapore.
Not far from Singapore’s airport sits a six-story facility called The Reserve. Tucked behind its steel doors are gold and silver bars amounting to about $1.5 billion.
The Reserve
The rise of gold has been meteoric in recent months, with bullion prices notching consecutive record highs. That was fueled in part by its safe haven appeal in the face of the volatility brought about by U.S.-China trade tensions and a mass U.S. asset sell-off in April.
Though gold prices recently cooled after investors’ risk appetites improved following a thaw in trade tensions between the two economic superpowers, some market watchers still believe they could climb to as high as $5,000 per ounce next year. Spot gold prices are currently trading at $3,346.32 per ounce, near historic levels.
Physical bars versus paper
The wealthy are also increasingly opting for physical gold bars instead of paper because they do not want as much counterparty and geopolitical risks, Gregersen said. While storing and owning physical gold isn’t completely free of price exposure, it limits exposure to certain risks that paper gold carries.
For example, counterparty risks are lower if one owns the asset directly. The Silicon Valley Bank crisis that unfolded in 2023 fueled investors’ preference for physically owning or securely allocating specific gold bars, instead of relying on paper claims or owning just a stake in a pooled reserve — which could be put at risk if a bank collapses, said Nicky Shiels, head of research and metals strategy at MKS Pamp, a precious metals refining and trading firm.
Gold prices in the past one year
The World Gold Council’s chief market strategist John Reade likewise noted that this is especially the case for those who are worried about the health of the global financial system.
“Some holders of physical precious metals are wary of storing gold within the banking system, even in allocated form, so they prefer to hold gold with entities that are not banks,” Reade said.
Lack of trust in some domestic banks is also a key driver, said Jeremy Savory, founder of Millionaire Migrant, a Dubai-based consultancy that provides citizenship-related services to high-net-worth individuals.
“If you’re in a country where you don’t trust the banking system, for example, Lebanon or Egypt or Algeria … they don’t want to put it in the bank,” said Savory, whose clients include high-net-worth individuals around the world who are trying to move physical gold to vaults in Switzerland, Singapore and Dubai.
That said, vaulted gold may be less attractive for short-term investors, given that the transaction costs for purchasing and moving physical gold is higher than that of paper gold, said World Gold Council’s Reade.
The Reserve’s storage facility features scores of private vaults capable of storing 25 to 60 tons of gold, which are stored in boxes and sealed.
The Reserve
But why store them in Singapore specifically?
“Singapore is viewed as the ‘Geneva of the East’; it has a reputation as a safe jurisdiction with relative political and economic stability,” Shiels said.
The Southeast Asian nation’s role as a key transit hub also makes it an attractive and convenient place for the wealthy to park their gold.
“Singapore is a transit hub. Anywhere that is a transit hub, usually makes sense that there’s a gold vault,” said Savory. “You can bank, you can store your gold there, but you can also pick it up [easily] because it’s a transit hub. And this is where Switzerland is losing out,” he added.
Although Dubai is also a popular transit hub with robust security, Savory noted that the process of storing gold in the city may require more paperwork.
“Dubai is probably a little bit more documentation-heavy. Some people don’t like documentation,” he said.
