Building symbolizes alternative investment power


There once was a day when the building at the corner of Wall Street and Broad Street in lower Manhattan symbolized all the glory and passion of American capitalism. The building still serves as an apt symbol, but people acknowledge the "real" exchange is located at its powerful data center out in New Jersey.

The buildings of the august bulge bracket banks may also stand for power, especially the Goldman Sachs building, but these structures certainly lack history. No one would confuse them for major tourist attractions.

This brings me to an article in Forbes that touches on the lack of symbolically powerful buildings that represent the alternative investment universe. A building may be a poor representation of the industry altogether.

"Unlike the older parts of the financial industry that grew up adjacent to, or in ready walking distance from, a stock exchange or a central bank, private equity and hedge funds have found their footing and taken their rightful place in the current financial hierarchy at a time when technology has freed them from both physical locations and the need for 'safety in numbers.' Perhaps that is part of the reason why a growing number of people in positions of influence and power have begun to express concerns about these new financial entrepreneurs. Perhaps their short histories and small, discreet offices, which seem slightly out of place when compared with their ability to influence events in the financial markets, cause a certain amount of unease."

I would quibble with the notion that the industry has been freed from physical locations. The reality is that locations are important, -- New York City in particular. Many funds have found that a Manhattan presence is necessary in to facilitate actual meetings, which still drive the industry. Not everything is done virtually. Not yet anyway.

If you had to pick a building that symbolized the industry, it would have to be 9 West 57th Street.

"Home to private equity giants (KKR & Co. LP and Apollo Global Management LLC), rising stars (Silver Lake Partners) and start-ups (Lightyear Capital and Sycamore Ventures), as well leading hedge fund managers (Och-Ziff Capital Management), this office tower provides an enviable home to many of the most successful practitioners of alternative investing, or at least those willing to pay $200 a square foot for the privilege," Forbes notes.

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