This year's EY Global Alternative Fund Survey shows that investors are balking at large allocations to hedge funds with just 7% planning to increase their exposure over the next three years, compared with 34% who plan to allocate more to private equity. The report also found that hedge funds are more likely than private equity to harness tech innovation, such as artificial intelligence, across their operations.
Both cryptocurrencies and tokens have come under pressure amid fears that the Securities and Exchange Commission might mount a major regulatory crackdown on the sector. The SEC already has settled several actions involving the sector, and some worry it might be poised to ramp up enforcement action against initial coin offering projects and cryptocurrency exchanges.
Financial Stability Board member authorities back a transition away from Libor, rather than pursuance of multiple interbank offered rates, according to an FSB report. The FSB notes "an appreciable risk that Libor will end" at the end of 2021 when regulatory support no longer exists.
The Federal Reserve has defended its proposals to relax rules governing bank capital requirements and leverage ratios in the face of bipartisan opposition from Congress. Republicans want the Fed to push forward with reforms to the Dodd-Frank Act before the Democrats take over the House in January, while the Democrats are opposed to attempts to ease the banking rules.
The rapid pace of financial deregulation over the past two years will allow governors and state officials to reform the regulatory framework, writes Chris Donahoe. While a trend toward state-level proposals may offer new challenges for financial firms, it will likely be predictable enough to allow companies to adjust accordingly, Donahoe writes.
The first set of opportunity zone fund regulations has been released, but questions remain about which capital base will be the best fit for such projects, says RealCrowd CEO Adam Hooper. However, the flexibility granted by the 36-month time frame for capital deployment opens the door for a wider investor group, Hooper says.
LaSalle Investment Management's move into the US real estate debt business through its acquisition of Latitude Management Real Estate Investors should pay off if the firm is differentiated by such factors as loan size, structure or target geographic markets, says Inland Real Estate Investment President and CEO Mitchell Sabshon. Real estate equity firms that want to move into real estate debt should also focus on expanding relationships with current equity investors to help garner business, Sabshon says.
Carter Validus Mission Critical REIT II recently expanded its data center and health care assets with the purchase of the Indianola Healthcare Facilities Portfolio for $13.8 million in Indianola, Iowa. The REIT also purchased the Benton Hot Springs Healthcare Facilities portfolio in Arkansas for $30.4 million and the Canton Data Center in Ohio for $9.4 million.
Puerto Rico Gov. Ricardo Rossello Nevares proposed legislation that would create a variety of incentives for opportunity zone investments throughout the territory. The incentives include a 20% contribution on the net income of an exempt business, 100% construction tax exemption and a transferable investment credit of up to 15%.
KBS Capital Advisors co-founders Keith Hall and Peter McMillan have formed Pacific Oak Cos. after the closure of distribution affiliate KBS Capital Markets Group. "Pacific Oak will leverage our well-established relationships and industry expertise to continue to deliver [alternative investment] opportunities to financial advisors and their clients throughout the United States," said Hall.