The following article is part of our Emerging Managers Insight Article Series and was contributed by CFS Group. Read more articles from the Series HERE.
There are many layers to creating a successful launch of a hedge fund, and often one that is overlooked is implementing the right furniture, while keeping in mind budget, timeline and dimensional restraints for your new office space. For someone starting a fund, and relying on your own capital, creating an office space within a budget is essential. In order to do so, you must partner with a furniture dealership that understands the marketplace and has the creativity to provide a solution that is light on the wallet but has the feel of stability and success.
As you would expect, just like many other businesses, the commercial furniture industry is a very competitive, relationship-driven sale, and unfortunately the client is usually on the raw end of the stick. Let’s give an example:
Hedge fund A has six traders, and in their mind “we need a trading desk.” But the fund's users only have one PC and two monitors each, which equates to a minimal technology requirement. The fact is that a full-blown trading desk can range from $2,000 to $5,000 (for height adjustable product) per user.
Here is what the fund manager needs to know. There are other options that will adequately handle your technology, save you up to 60-70% and give you the look and feel of a trading desk solution - savings of $10,000 just by having the proper relationship and information.
What comes to mind when you think of Miami, Florida?
Beaches and sun, exciting nightlife, a popular Will Smith song. These are typical associations with Miami. How about finance? This might not be the first thought that comes to mind, but the city of Miami is hoping that will change. Miami is a major financial hub and growing, and according to the president of the Miami Finance Forum, it’s the second most concentrated financial hub behind New York City.
Currently home to over 60 international banks and 100 alternative investment companies, Miami and its busy Brickell Avenue has emerged as “Wall Street South,” and according to Forbes is luring many financial firms away from more traditional hubs such as New York and Greenwich, CT.
In the past on Hedge IT, we have focused on the real estate markets in both the US and UK. Today, we move across the pond and provide an update on Hong Kong.
Asia has experienced unprecedented growth in its hedge fund industry, especially Hong Kong, despite difficulties in recent global financial markets. However, office space in Hong Kong is still undeniably the most expensive in the world.
Hong Kong’s Central District is a bustling location with gleaming skyscrapers and is home to about 90% of Hong Kong hedge fund offices. According to CBRE Global Research and Consulting’s 2013 Prime Office Occupancy Costs survey, the Central District’s overall occupancy costs of US$235.23 per sq. ft. per year topped the list as most expensive for the third consecutive time. London’s West End followed with total occupancy costs of US$222.58, and New York’s Midtown Manhattan ranked 10th on the list with occupancy costs of US$120.65.
Categorized under: Real Estate
Like David bravely dueling with the larger Goliath, small and mid-sized investment firms are often faced with insurmountable odds when competing against larger (and better endowed) funds. With more experience and more assets, larger firms have the advantage when it comes to soliciting investor allocations. But do these inherent shortcomings equal certain failure? If David can emerge victorious, can’t smaller hedge funds?
Earlier this week, we gathered a panel of experts in San Francisco to discuss this topic at length. Following is a brief synopsis of the topics they covered.
While it’s not the sexiest aspect of a hedge fund’s operations, a firm’s technology infrastructure is critical to its success. But a major consideration lies in choosing what type of infrastructure to use, and accordingly, where to host it.
Earlier today, we picked the brain of our Vice President of Client Technology, Steve Schoener, and asked him to share his expertise on the key drivers for firms migrating to the cloud. He also shared two examples of clients who’ve successfully transitioned to the cloud for various reasons. Below is a short recap of Steve’s presentation.
Would you rather watch the full replay? Scroll down or click here.
Tomorrow, we are co-hosting an exciting seminar in New York City with our friends at KPMG on the topic of launching a hedge fund. The half-day event, Hedge Fund Launch 2.0: Navigating the New Environment, will feature expert panel sessions on variety of topics including technology, regulations, capital raising, application platforms and more.
One panel we’re particularly interested in – beyond the technology panels, of course – is Corporate Essentials, a program focused on the often forgotten-about aspects of launching a new business. These aspects include human resources, compensation, insurance and real estate. Here’s a sneak peek at some of the content our panelists will be discussing at tomorrow’s event:
We’ve said it before, and we’ll say it again. Starting a hedge fund is a thoughtful and time-consuming process that requires skillful considerations and supportive collaborations to drive success. But with the changes that have swept through the industry of late, now seems like as good a time as any to launch a new fund.
We recently hosted a webinar with KPMG to examine the current hedge fund landscape for startups and determine whether 2013 is the right time to begin the launch process. Below is a short summary of the topics discussed. To watch the full event replay, click here.
Forming a Hedge Fund
There is a wealth to consider when launching your first (or second or third) hedge fund. From organizational and personnel matters to grappling with regulatory and compliance requirements and infrastructure needs, the list seems to never end. With the help of experienced prime brokers and service providers, however, managing these tasks has never been easier.
Hedge funds and investment firms are making the move to Asia, evidenced by the industry’s expansion to a record number of funds in Q3 2012 (according to Hedge Fund Research). With a healthy flow of both new startup funds and existing firms expanding their presence to the region, the Asian hedge fund market has quickly become the go-to locale for financial services.
Asia can be a challenging market to tap into, however, particularly as regulations take center stage. In addition to local regulations, Asian funds also need to keep an eye on what’s happening in the U.S. and Europe. According to HFMWeek, legislation handed down by the EU’s Alternative Investment Fund Managers Directive (AIFMD) “could make it very difficult for Asian managers to access European capital, affecting diverse facets of a fund’s operations including remuneration, leverage and custody.”
Technology is also on the minds of regulators – and investors too. HFMWeek states that “investors and regulators have shown little tolerance for allowing a fund’s infrastructure to ramp up over time, instead insisting that they feature best practice systems and processes at launch.” So if funds need to have a robust technology in place from day one, what are their options?
Rounding out our coverage of the hedge fund real estate market, today’s article looks at hedge fund hotels. Be sure to check out our other articles “A Look at London Hedge Fund Real Estate” and “Is Midtown Still the NYC Hot Spot?”
Hedge Fund Hotel: No, you can’t spend the night…
…But you can spend a year (or more or less). A hedge fund hotel is a fully-managed business office suite that provides high-end space, usually in a premium location, complete with important necessities required to get up and running quickly and efficiently. Hedge fund hotels typically provide premier technology, business solutions, telecommunications, and administrative and business support in an environment that is suitable for hosting potential investors and other important visitors.
Last week, we took a closer look at the current state of the New York City hedge fund real estate market. Today, we're crossing the pond to provide some updates on new developments in the UK real estate arena.
London remains Europe's number one destination for hedge funds and private equity managers, with Mayfair and St. James's being the most-preferred neighborhoods. But have mounting economic pressures and increased interest from overseas for property pushed funds away from these areas? How are these factors affecting the popular "hedge fund alley" section of Curzon Street and Berkeley Square in Mayfair?