KPMG Responds To Alternative Investments Boom

by Robert Lee, Tax-News.com, London

20 March 2007

The alternative investment industry is at a turning point as demand for assets and investment opportunities means the barriers between traditionally separate sectors are breaking down, according to accounting firm KPMG, which has just launched a new Alternative Investment Group.

"Hedge funds and private equity groups are increasingly looking at investing in physical assets such as real estate and infrastructure," observed Tony Rocker, head of KPMG’s new group. "Both these sectors are experiencing tremendous inflows of capital from institutional investors seeking investment performance.”

In response to a rapidly evolving market, KPMG has bought together its successful hedge fund, real estate and infrastructure businesses into an Alternative Investment Group.

“We expect to quadruple our business in this area within three years," Rocker continued. "This is an exciting time in the capital markets. In infrastructure in particular, demand for assets outstrips supply. While we see the potential for a minor price correction in the more mature markets, new growth opportunities exist in the US, Canada and Europe to fuel demand and the definition of infrastructure is being stretched ever further to create investment grade product.”

The newly formed group includes staff from KPMG’s corporate finance, tax, transaction services, audit and advisory practices.

Tom Brown, partner and newly appointed head of KPMG's European hedge fund business, commented: “As our hedge fund clients start to move into new and exciting investment areas, so we must follow."

"The permanent capital created by longer lock-ups and listing hedge fund vehicles opens up a vast array of investment opportunities for hedge funds, which are beginning to look seriously at longer term assets," he concluded.

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