Let there be no doubt: if private equity is one of the hottest asset classes right now, then property is the must have asset. And we are not just talking about Blackstone and its $36 billion acquisition of Equity Office, the US real estate investment trust run by Sam Zell.
The world's largest buyout by Blackstone scored highly with PEO's readers of course, but the most popular story of the month also had a property angle, albeit a less obvious one. Nigel Hammond's departure from Montagu Private Equity in london took top slot. The firm's UK head is going on an exteded subbatical, from which he is unlikely to return.
On the day this PEO exclusive was published, Hammond's plans were not clear. We can now reveal that he is set to pursue a personal real estate project and build a family house in Antigua in the Carribbean.
It is fast becoming the valediction of choice. A couple of months ago Ian Taylor, the departing chief executive of ABN Amro's European private equity team, said he was looking forward to working on his golf and attending to his portfolio of properties.
But perhaps real estate provides an ideal distraction and a credible cover story while you plan your return to the real business of private equity once the gardening leave expires. For some, spending more time with the family may just not be enough.
Another big topic on PEO in November was private equity's public image. More and more private equity professionals see their industry “under attack” from regulators, politicians and the media. Not every firm is striking back (yet): Blackstone for instance appears surprisingly content to let its money do the talking, and money does talk when Blackstone does its mega-deals.
Other practitioners are choosing to be more outspoken in the debate over private equity's merits and faults. Speaking at a gathering in Asia in November, Texas Pacific founder David Bonderman came out fighting on the industry's behalf, arguing that the collapse of a large LBO was by no means inevitable and calling for an end to private equity's “demonisation”.
Also making headlines by speaking out in favour of the industry was Jon Moulton of Alchemy, who questioned the probity of some of the auctions run by investment banks. Like Bonderman, clearly Moulton sees value in taking pre-emptive action before the enemy is too numerous and battling the industry on too many fronts.
Two making headlines by speaking out in favour of the industry was Jon Moulton of Alchemy, who questioned the probity of some of the auctions run by investment banks. Like Bonderman, clearly Moulton sees value in taking pre-emptive action before the enemy is too numerous and battling the industry on too many fronts.
Investors in Fac's latest fund, disappointed with its performance, had forced the remaining partners to cut costs and focus on exits. They are hopeful that this route will salvage more value than a sale of their limited partnership interests to a secondary fund.
In the case of the class action in New York, three shareholders in some of the US's most high-profile private equity-sponsored PTPs are claiming compensation for being forced to sell at low prices. They claim collusion by the big buyout firms, although their evidence appeared to be culled from press reports about the US Department of Justice's investigation of “club deals”. It seems doubtful whether the case can succeed: one lawyer called it a “fishing trip”.