Hedge Funds Double Rentals In West End Of London

Sep 12 2013 | 11:57am ET

Hedge funds snapped up more than twice as much office space in London's West End last year as in 2011, as the industry seeks space for more stock traders, salesmen and marketing professionals, and U.S. hedge funds boost their presence in the British capital.

Hedge funds leased 58,000 square feet of new space in the area in 2012, according to Cushman & Wakefield. In 2011, industry players added only 25,000 square feet to their footprint.

The biggest new leasers are BlueBay Asset Management, Elliott Management and Highbridge Capital Management, the real-estate brokerage said.

"There are not a lot of startups that are taking space today and that is a big change from six or seven years ago," Cushman's Henry Peto said. "We are seeing a consolidation of the industry with investors attracted to the more mature and larger hedge funds, who've been driving the space take-up in the West End."

According to Financial News, there are several driving forces behind the push in the West End. The renewed success—and concomitant popularity—of equity strategies has hedge funds hiring more managers in the space, notably BlueCrest Capital Management and CQS. Hiring is also up in distribution, as firms seek to rebuild assets lost during the financial crisis and accommodate more demanding institutional clients. In addition, a number of prominent U.S. fund managers, including Angelo Gordon & Co., Beach Point Capital, Elliott, Highbridge and Viking Global Investors, have been moving into the West End.

Hedge funds continued to favor Mayfair and St. James's, where they account for 31% of office space leased. Private-equity firms, whose new West End leasing held steady in 2012 at 45,000 square feet, account for 24% of office space leased in the neighborhoods, where the vacancy rate is below 4%.

Hedge funds priced- or spaced-out of Mayfair and St. James—where some rents are nearing their 2007 peaks—are looking slightly farther afield, to Marylebone and Soho, Cushman said.


In Depth

Q&A: Brevan Howard’s Charlotte Valeur Talks Strategy

Sep 18 2014 | 11:18am ET

Charlotte Valeur chairs the board of Brevan Howard Credit Catalysts, an LSE listed...

Lifestyle

Hedgies Rock Out For Children's Charity

Sep 15 2014 | 8:40am ET

It's that time of year again—when hedgies trade in their spreadsheets for guitars...

Guest Contributor

Volkered: How Financial Sector Reforms are Creating Opportunities for Hedge Funds

Sep 16 2014 | 11:28am ET

New regulations have dramatically curtailed proprietary trading activity in investment...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

September 2014 Cover

The London Whale: Rogue risk management

Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.