Hedge fund losses drive Manhattan real estate slowdown

By Lawrence Delevingne

Tue Nov 8, 2011

Large deals by Man Group and Peter Muller’s PDT Partners have been the exception in recent months.

  The new home of Man Group: 452 Fifth Avenue
The number of Manhattan real estate deals involving hedge funds fell significantly in October from the previous year, with the industry’s recent losses leading brokers to worry that 2011 could mark the first sizeable drop in activity since the financial crisis.

The full affect of poor performance in the third quarter has yet to be felt, but real estate professionals say hedge funds are signing fewer of the large and long-term leases, mostly in midtown Manhattan, that fuel the market for high-end real estate, and that the situation could worsen by yearend.

There were just 17 deals in October, according to data from CB Richard Ellis, compared with 38 in September and 30 in October 2010. Many of the recent deals involved smaller funds and office sizes; many weren’t hedge funds. October was the lowest month for financial...

ISSN: 2151-1845 / CDC10004H

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