Fri, 14/09/2007 - 06:56
Battered San Francisco real estate investment trust Luminent Mortgage Capital said this week it has repaid roughly USD1bn in warehouse lines of credit. Luminent, which managed USD9.5bn of assets, has taken cover under a USD65m infusion from a Puerto Rico-based hedge fund called Arco Capital and said it could take an additional USD60m from Arco if needed.
It plans to use the new capital to repurchase portfolios of mortgage securities. It said the moves were intended to help resolve its liquidity issues, such as current or impending margin calls and financing maturities, and also create opportunities for enhancing its market value in the future. It has also sold all but five loans in its warehouse and has said that it has no outstanding balances under two of its warehouse lines totaling USD1.5bn. It has also trimmed its staff by 15. Luminent's stock, which had dropped some 85% earlier this year, has gained back more around 31% in the last month, thanks to its recent strategic initiatives.
The 246 hedge funds that manage over USD1bn saw their assets under management jump 23% during the first six months of 2007. Such funds oversaw USD1.457 trillion in assets as of July 1, up USD273bn from Jan. 2007, according to industry publication Absolute Return. At the No. 1 spot was JPMorgan Chase, which saw its hedge fund assets rise 65% to USD56.2bn, including Highbridge Capital Management, a big hedge fund it acquired a few years ago. Goldman Sachs saw its hedge fund assets jump 23% to USD40bn, keeping it at the second spot, while DE Shaw finished third with USD34bn, surpassing Bridgewater Associates, which had USD32.1bn. Och-Ziff Capital Management came fifth with USD29.2bn. There are now nine U.S. hedge funds overseeing more than USD20bn apiece. A year ago, there were four such managers.
Absolute Return compiled the data before the recent turmoil in the global financial markets, which stung the performance of hedge funds in Aug. Hedge funds run by Paul Tudor Jones, Louis Bacon, Bruce Kovner and Barton Biggs lost at least 2.5% and as much as nearly 6% in Aug. In general, hedge funds lost 1.31% last month, according to Hedge Fund Research. Emerging markets managers lost 2.5% while global macro funds eased 2%. Quantitative funds managed to erase some of the losses posted earlier in the month. Short sellers, on the other hand, gained 1.3% in Aug.
Brushing aside market turmoil that's recently hurt hedge funds and buyout managers, Goldman Sachs has raised over USD1.5bn for a new, distressed fund called Goldman Sachs Liquidity Partners 3. The vehicle was previously expected to amass roughly USD1bn. It will purchase a wide range of distressed assets, including mortgages and buyout loans.
Placement agent Atlantic-Pacific Capital has recently hired nine professionals to meet demands of clients. Five executives are at senior levels including London-based Robert Bibow and Hugh Bingham in London, Brad Barsily and Stephen Salyer in Greenwich, and Robin Latour in San Francisco. The firm has raised USD4.1bn for nine funds so far this year.
Acting on a previously announced plan, California's Calpers, the country's largest public pension plan, has taken a USD600m holding in private equity firm Apollo Management Group.
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