Significant opportunity for fund managers in the Gulf, says Ocorian
15 March 2023 Saudi Arabia
Image: Anton Balazh
There is a significant opportunity for overseas fund managers to access capital in the Gulf and build a presence in the region, according to financial services provider, Ocorian.
The affirmation comes after Ocorian hosted an expert panel discussion with law firm Mayer Brown on how Shariah-compliant feeder structures can be a relatively straightforward and inexpensive process.
The Middle East has long been associated with ultra-high net worth individuals, and that population is set to surge by 24.6 per cent in the next five years, with Saudi Arabia poised to become home to 72 billionaires and the United Arab Emirates home to 42.
These metrics indicate that the wealth population presents a significant opportunity for overseas fund managers to access capital in the region.
New Shariah-compliant feeder structures are also helping US managers to overcome barriers, Ocorian adds.
Marc van Rijckevorsel, head of business development for funds, Americas at Ocorian, says: “The capital influx into the Middle East in the past 12 to 18 months has been very high, in part because of high oil and gas prices. As investors want this capital to be deployed, but which cannot easily be absorbed into the domestic economy, investors are looking globally in other jurisdictions.
“At the same time overseas fund managers, particularly those in the US, are having a more difficult time raising capital in their own markets, making the Middle East an excellent alternative opportunity.”
Lynda O’Mahoney, global head of business development for the Middle East at Ocorian, adds: “While sovereign wealth funds are seen as the ultimate sources of capital in the Middle East, family offices present a more attractive market. They are influenced by the next generation of investors who are seeking to diversify their portfolios out of domestic markets and conventional asset classes.”
The affirmation comes after Ocorian hosted an expert panel discussion with law firm Mayer Brown on how Shariah-compliant feeder structures can be a relatively straightforward and inexpensive process.
The Middle East has long been associated with ultra-high net worth individuals, and that population is set to surge by 24.6 per cent in the next five years, with Saudi Arabia poised to become home to 72 billionaires and the United Arab Emirates home to 42.
These metrics indicate that the wealth population presents a significant opportunity for overseas fund managers to access capital in the region.
New Shariah-compliant feeder structures are also helping US managers to overcome barriers, Ocorian adds.
Marc van Rijckevorsel, head of business development for funds, Americas at Ocorian, says: “The capital influx into the Middle East in the past 12 to 18 months has been very high, in part because of high oil and gas prices. As investors want this capital to be deployed, but which cannot easily be absorbed into the domestic economy, investors are looking globally in other jurisdictions.
“At the same time overseas fund managers, particularly those in the US, are having a more difficult time raising capital in their own markets, making the Middle East an excellent alternative opportunity.”
Lynda O’Mahoney, global head of business development for the Middle East at Ocorian, adds: “While sovereign wealth funds are seen as the ultimate sources of capital in the Middle East, family offices present a more attractive market. They are influenced by the next generation of investors who are seeking to diversify their portfolios out of domestic markets and conventional asset classes.”
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