HSBC Private Bank
has bought a high-profile office block in New York for a syndicate
of its private clients, its third such “club deal” in the past
year.
HSBC Alternative Investments
Limited (HAIL) and the group of HSBC private banking clients paid
about $255m for a 49% stake of the 907,000 square foot, 44-storey
building on New York’s Time Square.
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Alternative investments, including
real estate and hedge funds, have been central to HSBC’s strategy
in private banking.
It is one of the world’s largest
investors in hedge funds, with about $30bn under custody.
Club deals going well:
Meares
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By GlobalDataThe private bank’s global chief
executive Chris Meares told PBI the “club deals” have been
going very well and the bank has also been placing clients in
specialist real estate funds, as well as advising clients generally
on real estate.
Meares said the club deals and its
hedge fund business underlined its leading position in the
alternative assets space.
“The club deals are trying to
provide something special for clients that they would not
necessarily be able to get without doing it through us,” Meares
said.
“Taking on a big commercial
property for an individual is a big thing – but the club deal
allows them to go in and have an ownership with 10-20 like-minded
individuals.
“We see real estate as a very
important asset class that we have to be very good at.”
Property deal ‘once in a
lifetime’
HAIL chief executive Chris Allen
said HSBC is “witnessing a once-in-a-lifetime buying opportunity”
as the market for office leasing is recovering rapidly from the
economic crisis. Rent prices in Midtown Manhattan have risen for
the first time since 2008.
Allen added that this purchase
would have been “an impossibility” for HSBC Private Bank’s clients
to purchase on their own.
The bank bought two Washington
buildings, one in May this year and the other at the end of 2009,
paying about $200m for each block.
HSBC Private Bank also owns
Property Vision, a service for buyers interested in residential
property in the UK. Property Vision also operates in France and
will soon open an office in Switzerland, Meares said.
HAIL appoints new UK
alternative sales head
Meanwhile the bank has added to its
HAIL division in the UK with the appointment of Phelim Bolger as
head of UK sales in its alternatives division.
HAIL head of sales & marketing
Florence Picon said there is strong demand for its capability,
particularly in actively managed portfolios of hedge funds, real
estate and private equity, which are currently well positioned to
profit from the current market conditions and higher
volatility.
Bolger joins from Union Bancaire Privée, where he was an
executive director and head of UK institutional business.
