Max Severijns

Not only the US commercial real estate market is struggling with historically low prices due to interest rate hikes and the trend of working from home. Europe, too, is in trouble.

The Bank of England (BoE) this week reiterated its concerns about the risks of higher interest rates and limited data disclosure in private credit markets. Harvey Schwartz, CEO of The Carlyle Group with some 380 billion dollars under management, believes those concerns are exaggerated.

While Wall Street is pulling out all the stops to curb ‘Basel III Endgame’, private lenders are in pole position for implementation of the banking rules. The price at which US big banks can borrow money will be skillfully undercut by private credit funds, but critics in the banking sector denounce the lack of effective supervision of the ‘non-bank’ lenders.  

Republicans in the US state of New Hampshire have introduced a bill that makes the consideration of ESG criteria by sovereign wealth funds a crime. Under the proposal, this offence could be punishable by imprisonment for not less than one year and not more than 20 years.

In the private equity (PE) market, a significant shift is occurring as Limited Partners (LPs) increasingly demand the release of funds from older investments before considering new commitments. This change comes amidst a backdrop of unprecedented levels of “dry powder” - uninvested capital within PE firms.

Support from the world’s preeminent asset managers for shareholder proposals concentrating on environmental and social concerns has plummeted to an unprecedented nadir in 2023. This steep decline is predominantly attributable to Anglo-Saxon entities.

Roderick van Zuylen is prepared for the challenge. On the 1st of January, the ex-Van Lanschot Kempen portfolio manager inaugurated his own investment fund in the US: Night Watch Investment Management. “I desired a name that alluded to my Dutch heritage, yet Dike Capital and Tulip Invest were disregarded for obvious reasons.”

A series of significant lawsuits highlight a core principle of the US economy: political agendas are personal, while investor returns are paramount. 

Kristina Hooper, chief strategist at Invesco, understands that the endless debating about interest rates seems a bit excessive, “but back in the day, investors had to guess what was going to happen to interest rates by looking at the thickness of Alan Greenspan’s briefcase”.

Political pressure is mounting on the Securities and Exchange Commission (SEC) over its efforts on climate reporting and Environmental, Social, and Governance (ESG). With the recent delay in final regulations, the question arises: Is the SEC bowing to pressure from critics?